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Orlando Bankruptcy Law Blog

Is student loan debt relief impossible?

According to experts, the outlook is not pretty for student loan borrowers. While a college education is virtually necessary to secure a good job in Florida, the cost of that education may feel like it is rising out of control. With predictions of defaults on the rise, borrowers may want to begin considering their debt relief options.

By 2023, 40 percent of student loan borrowers in the United States are predicted to default on their student loans. Currently, 44 million people owe a collective $1.5 trillion, and that number is only growing. The 2016 graduating class left school with an average of $37,000 in student loans, and 2017 graduates are burdened with an average of $40,000. Next year's 2019 graduates may have an even greater burden on their shoulders.

New credit score could lead to more credit card debt

Credit scores govern many aspects of daily life in Florida. From who is eligible for an auto loan to what kind of apartment a person is approved for, the credit score is an important financial tool that is not always easy to improve or maintain. Because of this, some may be pleased to learn that FICO scores are being overhauled. Unfortunately, experts caution that it could lead to an increase in credit card debt and more.

UltraFICO will consider factors outside of those traditionally considered in credit histories. Unlike in the past, a person's banking activities will also influence the score. Information like how long a person has maintained a bank account and their money management skills can now boost -- or lower -- a person's score.

Don't give up social media -- use a debt repayment plan

Debt can weigh heavily on the mind of the typical Florida resident, with worrying thoughts intruding on otherwise peaceful activities. Although most people try their best to pay off their debts, the task often feels insurmountable. With growing balances and shrinking disposable incomes, some people would even give up their most beloved activities to get rid of debt. Luckily, a debt repayment plan through Chapter 13 can provide debt relief without anyone having to take drastic measures.

Over 1,000 American consumers with at least $500 worth of credit card debt participated in a recent survey. About 33 percent said they lost sleep because they were so worried about their credit card balances. Another 25 percent reported that their relationships had been hurt by growing debts. Both of these stressors could be exacerbated by carrying balances from month-to-month with no end in sight, which 77 percent said they did.

Chapter 13 bankruptcy: Debt common across generational lines

According to a recent survey, debt is almost as American as apple pie. Nearly three quarters of Americans have at least one kind of debt, which can create an enormous burden on the individual. While some people might think that certain individuals or generations might be more likely to accrue huge amounts of debt, this might not be the case. Virtually anyone in Florida can find themselves in need of debt relief through Chapter 13 bankruptcy.

The 2017 study included more than 1,000 adults from across the United States, and 66 percent of respondents reported that they carried consumer debt. The per person average for this form of debt came out to $34,055. This covered debts such as credit cards, car loans and more.

Understanding the wage garnishment process

Virtually no one plans to fall behind on their bills, but many people in Florida find themselves in this exact position. When consumers still cannot get caught up despite their best efforts, creditors will sometimes turn to wage garnishment. Not all debts may be repaid through the garnishment of wages, although many can, including back taxes, student and personal loans, child support and legal judgments. Facing garnishment is not necessarily an impossible situation, though, and consumers have options when dealing with the process.  

Credit collectors cannot just call up a person's boss and ask that a portion of that individual's paycheck be given to them instead. First, they must schedule a court hearing, of which the debtor will likely be notified. At the hearing, the creditor will have to demonstrate that not only are it is owed money, but that the person who took on the debt has not made the necessary repayment efforts. If the creditor's request is granted, the employer will be given instructions for withholding wages and will also have to notify their employee of the garnishment

Are federal programs failing to provide promised debt relief?

The student loan crisis does not appear to be going anywhere anytime soon, and that is perhaps because of the very few options that borrowers have for dealing with this type of debt. Many people in Florida felt optimistic about a program that was intended to provide debt relief for public service employees, but that positive outlook seems to be fading. The Public Service Loan Forgiveness program has only helped 96 people in its 11 years of existence. 

Enacted back in 2007, the PSLF is supposed to forgive student loans for qualifying public service employees. Aside from being a public service employee, applicants must also make qualifying payments for 10 years. This requirement meant that no one was able to actually seek forgiveness until Sept. 2017. Before doing so, however, applicants must first certify that their employment and loans are eligible. 

3 unexpected ways you can fall into debt

The idea of avoiding debt seems straightforward. If you do not spend more money than you have, you can live debt-free. Unfortunately, it is not always as easy as it sounds. In a consumerist society, it can be hard to control your spending and manage money wisely-aside from all the emergency expenses that may drain your savings. 

Debt is often not something that builds up overnight; it can slowly creep up on you. Here are three common debt traps you should avoid:

Florida ranks high for credit card debt

The current economy climate is looking considerably better than it did even just 10 years ago. In the decade following the Great Recession, unemployment rates have hit a record low and borrowing by the average Florida consumer seems to be going strong. Still, delinquency rates for credit card debt and auto loans are on the rise for some people. Since Florida has the third highest rate for credit card debt, it could be a real problem in the state. 

While the overall American economy is stronger than before, this has not necessarily translated into real-life improvements for many people. It is perhaps not surprising that credit card bills are one of the more common debts that people fall behind on, as there are approximately 470 million credit cards in the United States. The average household has not one, but nearly four cards. 

Can Chapter 7 bankruptcy help student loan woes?

As the second largest category of consumer debt nationwide, student loans are fairly common among Florida residents. Unfortunately, so is defaulting. Approximately one million borrowers default on their student loans every year. For those who think they may default on their own loans, Chapter 7 bankruptcy could provide much needed debt relief. 

The student loan crisis is not getting better anytime soon. The average 2017 college graduate left school $40,000 in debt -- $3,000 more than those who graduated in 2016. It might be due to rising education costs that experts have predicted that 40 percent of those with student loans will default on them by the year 2023. 

Rapper T-Pain faces home foreclosure in Florida

T-Pain is probably most well-known for his musical prowess, but music fans might be surprised to learn that the rapper recently lost his Florida home. Home foreclosure can happen to anyone, but there are steps that homeowners can take to stop or prevent the process altogether. However, individuals must be proactive in their approach. 

In 2007, T-Pain used an $85,800 mortgage to purchase a modest Florida home. However, the bank that holds that mortgage claims that the rapper stopped making payments in July 2016. In 2017 the bank sued T-Pain, citing an owed debt of $83,061.86, which includes what was left on the mortgage as well as interest. 

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