Many Texas residents likely pride themselves on having their finances in order. However, even individuals who are financially stable one moment could find themselves struggling the next. As a result, Chapter 7 bankruptcy may end up as a viable option that individuals consider when dealing with the fallout of unexpected financial upset.
One major reason that parties who once had their affairs in order could suddenly face hardships is job loss. Some people may have been able to stay on track with their current income stream, but due to a lack of emergency funds or inadequate savings, they may become reliant on credit cards or loans if their income suddenly stops. As a result, they could easily rack up a considerable amount of debt during their time of unemployment.
Another reason that individuals may find themselves considering bankruptcy is medical debt. Even with savings and insurance, medical expenses for an unexpected emergency or other treatment could easily reach thousands of dollars. In fact, medical bills are a top contributing factor to bankruptcy filings with some statistics indicating that this reason makes up 25 percent of filings while others show as much as 60 percent.
When faced with a difficult financial situation, some individuals may feel that they have failed or made mistakes. However, some causes of money issues cannot easily be avoided. If Texas residents are struggling with overwhelming debt, they may wish to consider Chapter 7 bankruptcy or other debt relief options that may help them effectively address their liabilities. Individuals wishing to gain more information on this avenue may want to consult with knowledgeable attorneys.
Source: fool.com, "5 Key Reasons People Go Bankrupt -- and How to Avoid Them", Selena Maranjian, Feb. 11, 2018