Struggling with finances is something with which many Texas residents can relate. Finding ways to deal with ever-increasing prices for basic needs such as food, shelter and transportation often leads individuals to live above their means more out of necessity rather than some design to get into overwhelming debt that could easily lead to Chapter 7 bankruptcy. When credit cards no longer suffice to meet their needs, many people turn to personal loans to get by.
Under these circumstances, it may not be surprising that personal loans are rapidly becoming the fastest growing form of debt. According to Experian, the number of personal loans taken out by consumers from the fourth quarter of 2017 to the fourth quarter of 2018 increased 11.9%. With an average $353 per month payment on an average balance of $15,143, this could quickly become another debt crisis.
Personal loans used to be more difficult to obtain, but with the internet, they are now more accessible. Lenders approve loans online after marketing them as cheaper and better alternatives to higher interest credit cards. The attraction of fixed payments and interest rates also increased their popularity in recent years. Personal loans are also marketed as debt consolidation loans, which could prove quite enticing to a consumer making numerous payments each month.
This may seem like an advantageous way to deal with some debts, but student loan balances are already out of control. Credit card debt continues to rise as well. The amount of debt held by people across the country and here in Texas just keep rising, and with the addition of personal loans, more Chapter 7 bankruptcy filings could happen in the near future.