Why Are Chapter 13 Bankruptcies Increasing in Memphis?
Around the country, Chapter 13 bankruptcies are on the rise. In Memphis, Chapter 13 bankruptcy is no different. As a Memphis debt relief attorney, I have some ideas of why this is happening and what to expect in the future.
What Is Chapter 13?
Chapter 13 bankruptcy is a type of personal bankruptcy designed to help you get a fresh start while protecting your assets. With Chapter 13, you set up an affordable payment plan with your attorney and the courts. It’s created with your individual situation in mind, so you can make the payments without worry.
As a result, you get to keep your home, car, and other assets you include in the bankruptcy. It stops foreclosure, repossession, wage garnishment, and any creditor harassment you may be experiencing.
(If you’d like to know more about how Chapter 13 works and what it can do for you, check out our free report The Power of Chapter 13 Bankruptcy.)
Why the Increase in Chapter 13s?
For the last couple of years, experts warned personal bankruptcies might increase in 2022. As the government slowed its Covid relief benefits, a lot of families had to rethink their finances.
In particular, the government ended foreclosure moratoriums and long-term Covid unemployment benefits. This meant homeowners who’d survived the pandemic without making regular mortgage payments suddenly had a strain on their budgets again.
In addition, inflation led to an increase in interest rates. Every time interest rates go up, it impacts homeowners and car owners.
Let’s say you’re struggling to afford your mortgage or car payment. Higher interest rates may make it harder to downsize, because the rates might make even cheaper homes or cars less affordable and more competitive.
Chapter 13 addresses this problem by helping people stay in their homes. At a time when children are finally back at neighborhood schools, when so many of us are working from home, stability means everything. Families who want and need to stay where they are have, predictably, found a solution in Chapter 13.
So how long might this uptick last?
As the economy normalizes, bankruptcies tend to normalize as well. Over time, we’ll likely see these numbers stabilize to around what they were pre-pandemic.
Regardless of the rates, if you’re struggling right now, you need an immediate solution. Here at Darrell Castle & Associates, our job is to help people hoping to keep their homes.
A Memphis Chapter 13 Bankruptcy Attorney You Can Trust
If you’re worried about foreclosure, repossession, or wage garnishment, you clearly aren’t alone. All across America, other families are facing the same thing. If you want to put a stop to it once and for all, you should consider what Chapter 13 can do for you.
For decades, our Memphis bankruptcy attorneys have helped thousands of Memphians figure out the best solution for their situation. We never pressure you into one kind of bankruptcy or another, and we don’t push bankruptcy on anyone who doesn’t need it. Instead, we talk through your circumstances and help you figure out the best step forward for the outcome you want.
We’re dedicated to your success and ultimate freedom from debt. And as a result, we’ve received multiple Martindale-Hubbell awards for client satisfaction.
The conversation is completely free. To get started, contact us at 901-327-2100 or use the form on this page. We look forward to talking with you.