Many Americans have had to adapt to harsh financial realities due to increased unemployment or under employment due to Covid-19. As of November, estimates reveal that for every 16 unemployed people, there are only 10 jobs available, with older workers losing jobs faster and returning to work slower than their younger, mid-career peers. Those who are able to find work may only secure part time employment, while some seasoned professionals have had to accept salaries well below average.
Americans fortunate enough to have savings before the pandemic have been forced to spend down their savings to keep up with necessary bills – unemployment benefits have not been nearly enough. Many more have had to tighten their belts, making the most of income they still have coming in from essential jobs, while choosing which bills to skip.
In a ten month (and running) test of financial resiliency, individuals and families have tried a number of strategies to stay afloat. Many have taken advantage of government and other programs to make ends meet in the short term – mortgage forbearance, working with credit card issuers to delay payments, frozen student loan payments, and prohibitions against evictions for renters have bought Americans some time, but eventually will come to an end. Many may consider bankruptcy as yet another strategy to catch up.
For people with fewer assets, Chapter 7 personal bankruptcy allows debtors to discharge unsecured debt such as credit cards or medical bills to get a fresh start. For borrowers who do not qualify for Chapter 7, a Chapter 13 provides a repayment plan stretching over a 3-5 year period while allowing borrowers to keep more of their assets. Both Chapter 7 & 13 allow filers to exclude certain property from bankruptcy, including retirement plans, so it is worthwhile to explore what bankruptcy can offer before deciding what to do moving forward.
Bankruptcy protection is your right as an American. When you are considering bankruptcy as payments become due, contact Peoria bankruptcy attorney Charles E. Covey for more information today at 309-674-8125.