Personal bankruptcy protections are a resource for consumers struggling with overwhelming debt to understand and carefully consider. Bankruptcy options can provide important relief. Though the American Bankruptcy Institute recently reported that May bankruptcy filings dropped based on a year-over-year comparison and sequential comparison, Tennessee was second on the list of states with the highest per capita bankruptcy filings for May.
The bankruptcy filings represented a 4 percent decrease from the same month during the previous year. Commercial Chapter 11 bankruptcy filings showed the sharpest decline. A representative of the American Bankruptcy Institute noted that increased costs of borrowing have added to mounting debts and increased financial strain on both struggling businesses and families.
Bankruptcy options can help struggling consumers in a variety of ways. Chapter 7 personal bankruptcy is one option struggling consumers can consider to help with a fresh financial start. Chapter 7 bankruptcy is considered a liquidation bankruptcy option that allows struggling consumers to liquidate non-exempt assets to repay debts. Another personal bankruptcy option is Chapter 13 bankruptcy which allows the filing party to repay debts over time according to a debt reorganization plan. To file for Chapter 13 bankruptcy the filing party must have a reliable source of income to repay debts with.
The decision to file for bankruptcy protection is an important one which is why struggling consumers should thoroughly understand their options. In common, bankruptcy protection options can provide relief to struggling consumers which is why these options are available to consumers facing the strain of overwhelming debt.