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At some point almost every individual or family can experience a hardship that makes it impossible to keep up with ordinary living expenses. Loss of income, pay cut, increased expenses, downturn in business, loss of a family member, an adjustable rate mortgage or some medical condition can all cause financial pressure.
Most people try everything they can to avoid bankruptcy, by working harder and longer, taking another job, borrowing money from family and friends,spending only on necessities, cutting back on holidays, selling off assets, obtaining a home equity loan, quit paying into their 401K, giving up health, dental and life insurance. This is no way to go about living life. Credit card companies are not on your side. They make your financial situation worse by raising your interest rate and tacking on over the limit fees and late fees. Some credit card companies are charging as high as 39% interest. The credit card companies want your debt to increase so they can make more money from you. For them, it is simply a business decision. At some point, many people cannot pay the minimum payments and are in over their head. Then the letters and calls start.
They call you in the morning, at night and at work. They call you three or more times a day and the calls do not stop. You stop answering the calls and you don't answer your door for fear of a summons by a creditor. You may miss work due to having to appear in court and your wages can be garnished. Creditors can slap liens on your house and they can attach your bank account.
Bankruptcy is a very powerful tool that can protect you from your creditors. Bankruptcy laws have changed dramatically since the old days. Bankruptcy is no longer something to be ashamed of in these difficult times with so may people and businesses having filed bankruptcy. It is way to save your home, your car, your business, and your family from losing everything.
