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Articles Posted in Personal Finance

A recent study released by an academic medical journal explains the effect that a cancer diagnosis can have on a patient’s financial situation, and how bankruptcies that are filed immediately after a diagnosis can result in the patient receiving poorer treatment and possibly having an increased risk of mortality from the illness. The results of the study demonstrate that it is essential for our aging population to get their credit under control before they get sick, although it is also important to realize that any matter of medical bills and debts incurred can be discharged with a bankruptcy.

one-dollar-bill-1487099The Results of the Study

The study, released in early 2016 in The Journal of Clinical Oncology, was commissioned as a follow-up to a previous study that showed that a cancer diagnosis increased the risk of a patient filing for bankruptcy by 250%, and it sought to determine if a patient’s filing for bankruptcy increased or decreased their risk of cancer survival. After analyzing data from approximately 230,000 individuals diagnosed with cancer, the study found that those who filed for bankruptcy after their cancer diagnosis were more likely to die from the cancer than those who did not file for bankruptcy.

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Tens of thousands of people each year file for bankruptcy in order to escape their dire financial situation and start anew. In many cases credit card debt, car loans, unsecured debt, and even student loans can pile up, making an individual’s situation impossible to sustain.

When someone’s financial situation gets to this point, bankruptcy may become a viable option. However, it becomes very important to understand what exactly filing for bankruptcy can do to help your future, and what is beyond the scope of filing for bankruptcy.

graduation-2-1326285-mNielsen v. ACS, Inc.

In a recent case, Nielsen v. ACS, Inc., an Eighth Circuit bankruptcy court panel decided a case about when a debtor’s student loan debt can be discharged as a part of the bankruptcy.

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If you are currently considering bankruptcy, chances are that your credit score is not very good. Going through the bankruptcy process—while freeing you of the crippling debt that burdens your daily life—will likely have a further impact on your credit score.

money-641083-mHowever, there are some things that recent bankruptcy filers can do to help rebuild their credit scores. In some cases, people who follow these guidelines are able to attain a higher credit score than they had before they filed bankruptcy.

The first thing to consider before filing for bankruptcy is to consult with an experienced bankruptcy attorney to help you along the way. The experience that comes along with hiring an attorney is an invaluable resource to those who want to quickly get their life back on track after their bankruptcy.

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Nobody sets out on a life path expecting that they will one day need to declare bankruptcy. However, the reality is that filing for bankruptcy can—and does—help hundreds of thousands of people each year get out from under the crippling debt that all too often controls their lives.

But how can you tell when a good time to declare bankruptcy is? How long do you wait?

usa-dollar-bills-1431130-mBelow are seven indicators that may be signs that it is time to think about looking into bankruptcy as an option for a fresh start:

  • Missing Payments:  If you are missing payments on your household or credit card bills, it is a good indication that you may be over your head in debt. Pay especially close attention to major bills, such as the mortgage payment, rent, or a car payment. Skipping these as a result of lack of funds is an indicator that it may be time to look into filing bankruptcy to help relieve your financial burdens.
  • Debt-Management Companies Refuse to Help:  If you have tried to qualify for debt relief, but have been told that you cannot qualify, it may be because you don’t have a sufficient debt-to-asset ratio.

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Louisville bankruptcy attorneys know that there are a wide range of reasons people file bankruptcy in Kentucky. sale.jpg

Some have mounting medical bills. Others have fallen victim to the economy, finding themselves out of work – and out of other options. Frequently these days, bad real estate debt is involved. For still others, the issues may involve compulsive spending. Shopping addiction plagues about two to five percent of Americans.

Contrary to what some would believe, poor spending habits are not at the root of the majority of bankruptcies. Still, when saving trumps consumerism, your household budget is very likely on the right track.

While spending addiction is sometimes discussed in light-hearted banter, it can rip apart families, deplete your bank accounts and destroy your credit. In some cases, filing for personal bankruptcy can be the first step towards helping you get a fresh start.

But as with any addiction, this one requires that you recognize it before you can do something about it.

Even once you have recognized and addressed it, you must realize that, like other addictions, you may always have to battle some form of temptation. Discipline and moderation will help you spend more responsibly and rebuild your credit in the wake of a Louisville bankruptcy.

Battling a shopping addiction is tough because, unlike alcohol or drugs, which you can avoid forever, at some point, you’ll have to enter a store to be self-sufficient.

One of the first things you’ll want to do is recruit those closest to you. Confide in them about how much you’ve been spending and what your financial situation is. Chances are, they’ll want to help you avoid future temptation by opting for outings that don’t involve malls or stores.

You’ll also need to be honest with yourself about the internal dialogue you’re having with yourself when you shop. You may want to consider talking to a therapist to address the underlying problems associated with your over-spending.

Next, think critically about what other activities you might enjoy doing that will help you avoid the mall. You may consider playing a sport or joining a club or something of that nature. At first, it may merely be a distraction. However, the goal is to help you transition to a healthier financial situation.

If you find yourself standing in front of a tempting “bargain,” walk outside for a few minutes. Maybe even wait a full day and sleep on it before you go ahead with the purchase. This will force you to think it through more carefully before you simply make an impulse buy for something you don’t need – and can’t afford.

Also, take a very close look at your daily expenditures. Maybe even keep a log. Things like a cab ride or lunches out – they don’t seem like much in the course of a day, but they quickly add up.

Finally, recognize what your weakness is. Just about everyone has one. For some people, it’s shoes. For others, it might be golf or designer duds. Whatever it is, know that in the long-run, being debt-free will be a greater reward than those new jeans any day.

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It’s the beginning of 2012 and while it’s a new year, for most people, the financial baggage of 2011 didn’t stay behind in December. Times are tough, finances are tight and after the holiday season, bills may be looming.

Our Louisville bankruptcy lawyers recognize the frustration and pain that many people are going through right now financially. Government programs haven’t done much to help working-class people, jobs are still tough to find, bad mortgages are still hurting families and prices keep climbing for groceries and other everyday needs.
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Our lawyers also recognize that filing for Louisville bankruptcy has benefits for those who take advantage of these laws. They are consumer-focused and allow people a fresh start when expenses have gotten out of control and money is tight.

Some believe that bankruptcy is a bad option because it can hurt a person’s credit, but the opposite is true. If a person has missed payments and is behind on various bills, his or her credit score has likely taken a tumble.

Filing for bankruptcy will actually begin to repair what has been broken by the past. The purpose of bankruptcy is to provide assistance to consumers who have fallen into bad times, often because of circumstances beyond their control.

The most obvious in recent years has been the housing collapse, which has affected nearly every American. As foreclosures have increased, housing prices have dwindled. Bad loans that people were trapped into signing years before the housing bubble burst are now coming back to haunt them. As the housing market collapsed, so did the rest of the economy, costing millions of people their jobs. And without a job, money has gotten even tighter.

It’s a cycle that no one has figured out how to fix and many Louisville residents are stuck in the middle. They are trying to get by, but are having difficulty and aren’t sure how long the difficulty will last.

Creating a plan to get out of debt and to try to get out of tough times takes a lot of work. Sometimes, it can be done without the help of bankruptcy, but through other financial and legal avenues, such as a short sale, credit counseling or stopping wage garnishment, there are ways to improve your money situation.

These are a few smaller steps that people can take to try to make some progress in the area of personal finances:

Quit smoking or lose weight — Common New Year’s resolutions, but these could cut down on insurance premiums and save a little money. Obese policyholders and smokers pay between 15 and 22 percent more for insurance than others.

Shop smart — Clipping coupons, not being tempted by buy-one-get-one-free sales and using generic brands can keep some money in the wallet.

Simplify your finances — Set up online accounts so you don’t have to worry about checks, stamps and the mail. Max out your savings and do it automatically so you don’t have to worry about forgetting.

Get smart about money — Don’t be in the dark about money issues, but study up on terms and that will allow you to be more active in financial planning.

Plan for the unexpected — Start an emergency fund — most experts suggest having six month’s worth of funds set aside.

Pay down your debt — Paying off your high-interest debt can save you money in the long run. And try to pay more than the minimum.

Create a basic budget — Don’t make it unrealistic, but attempt to keep it simple. Be transparent and allow it to be fluid.

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SHOULD I REAFFIRM ANY DEBTS WHEN I FILE BANKRUPTCY?

When one files Chapter 7 bankruptcy in Kentucky or Indiana, a discharge is received by the debtor at the conclusion of the case. This discharge releases the debtor from all dischargeable debts that were incurred prior to the filing of the bankruptcy case. Certain debts survive bankruptcy, such as child support and alimony, most student loans and certain taxes.

A reaffirmation agreement is a legally binding document that the debtor enters into with a creditor, pursuant to which the debtor agrees that an otherwise dischargeable debt will not be discharged and therefore, will survive the bankruptcy filing. This means that this particular creditor with whom the debtor entered into such an agreement can take legal action to collect the debt after bankruptcy if the debtor defaults, even though the debtor may have received a discharge of all of his other debts.

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