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Essex County household debt accumulates, some turn to bankruptcy

In an uncertain economy, overwhelming debt and bankruptcy are a reality for many people. In some cases debt problems can be resolved without bankruptcy, but in others debt can accumulate until it becomes an inescapable problem. When someone in Essex County finds themselves in this situation, bankruptcy protection may provide the best solution.

The month of May saw the largest increase in credit card debt this year, with nearly $8 billion added to the total outstanding consumer credit card debt. This is the largest increase since pre-recession time. At the end of May, the total outstanding consumer credit card debt was slightly more than $870 billion.

The numbers reported for May are only a part of a growth trend for credit card debt. During the recession, banks tightened up on lending standards, which made credit less available to consumers and thereby limiting related debt a consumer might accumulate. Since March 2011, though, credit card debt has been on the rise.

Not only has credit card debt increased, but the Federal Reserve says that other debt such as auto and student loans has increased as well. For many Essex County households, debt problems can seem to come out of nowhere. The debt they are aware of accumulates and doubles, until they are faced with a greater problem than they are able to manage on their own. In these situations, turning to a personal bankruptcy filing through Chapter 7 or Chapter 13 can provide necessary protection while setting a plan in place for a return to financial stability.

Source: insideARM.com, "Credit Card Debt in May Grows at Fastest Pace Since Recession," Patrick Lunsford, July 10, 2012

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