THE NUMBER 1 CAUSE OF BANKRUPTCY
All things considered, credit card debt is the number one cause of bankruptcy.
There is a lot of noise in the news about medical bills that cause bankruptcy. I saw an article recently that said sixty percent of bankruptcies include medical debt. That is probably about right. But do they cause bankruptcy? I don’t think so. I think that in most cases, medical providers are willing to make arrangements. I have had people who have huge medical bills and they’re able to pay fifty dollars a months and so that is what they pay. And the medical providers are happy to do that. Ultimately, they are able to settle those if they have a chunk of cash to use towards that, but it can be a very large bill and sure, that causes some problems.
But the number one answer is really credit cards. Credit cards are the most one-sided contracts this side of slavery. And I am not kidding. In a credit card agreement, you have agreed to let that credit card company change the payment date, change the terms, change the interest rate, and ultimately to cut off your credit card line of credit. Many people have seen that happen to them. It is perfectly legal. It’s in that big, long page of fine print that you didn’t read when you signed up for the credit card. It is allowed and in the United States of America.
People are getting stuck with credit card bills that are ridiculous. They try to get a reasonable interest rate and sometimes the banks with work with you. Actually, we are pretty successful with that, doing debt settlements and working that out. But a lot of times my clients come to me and they say “I’ve tried.” I’ve tried to do what I could. I made a payment arrangement or I tried to make a payment arrangement. They either didn’t want to do it or after six months they said “No, that’s not enough.”
Many things can happen with a credit card payment and a debt that people didn’t intend to have. Sometimes they haven’t used their credit cards responsibly, but mostly they are just good, honest people who got in a hole. They felt like they were going to get a new job, or that they would be able to sell their house and they would be able to make those payments. But they just got in too deep and now they are piled up with credit cards. I have had people well into six figures in credit card debt. It is a very troubling thing. It makes you lose sleep. And those companies are not nice when they call you. They will be very angry with you. They will call you names and they will be very personal.
What we do in our practice is take that burden off of you. We will help you, if we are able to, take those calls and settle those claims or we will file a bankruptcy.
If you are having problems, call us today at 480-807-9300.