Rise in Foreclosure Rates May Impact Bankruptcy Filings
The President of the Federal Reserve Bank President said Monday he expects the U.S. housing market to continue decline and that the foreclosure rate will rise for several more quarters.
As more adjustable rate mortgages continue to reset over the next few months and quarters, borrowers will face having to search for alternative financing in a ever-constricting credit market or else losing their homes. Many, no doubt, will choose to leave their homes behind, while others will file bankruptcy to protect their homes and other assets.
In my experience, by the time my clients have come to see me, their only option to consider is bankruptcy. I think part of this is due to the stigma attached with filing bankruptcy. In early times, countries like the United States and Britain had debtor’s prisons, where people were sent who could not pay for their debts.
In our time, though, bankruptcy has become more routine, just like any other financial decision. Not only have major international companies filed for bankruptcy protection, but so have several famous individuals. I recently came across this list:
Abraham Lincoln
Andy Gibb
Anita Bryant
Benedict Arnold
Bjorn Borg
Buster Keaton
Chaka Kahn
Corey Haim
Cyndi Lauper
Dorothy Hamill
Frank Baum
Gary Coleman
George Frideric Handel
George Jones
Henry Ford
John DeLorean
John Wayne Bobbitt
Kim Basinger
M.C. Hammer
Marvin Gaye
Meat Loaf
Melvin Belli
Mick Fleetwood
Natalie Cole
P.T. Barnum
Red Foxx
Toni Braxton
Ulysses S. Grant
Walt Disney
Wayne Newton
Willie Nelson
Zsa Zsa Gabor
Ted Nugent
Burt Reynolds
Mickey Rooney
Anna Nicole Smith
Mark Twain
Oscar Wilde
Tammy Wynette
This is not to say that bankruptcy does not affect your ability to get credit, buy a house or car or have some impact on the amount you may pay for credit in the future. However, by the time most of my clients see me, their debts and late payments have already been reported on their credit report and will remain there for years.
If you find yourself in too deep to pay your debts, don’t continue to avoid seeing an attorney. Whether it’s me or someone else, be sure you talk to someone about your rights. You can take charge of the situation and take control back from the collection agents!
