HOW TO DEAL WITH PERSONAL DEBT

On behalf of Trenton Grand of Grand Law Firm posted in Bankruptcy on Friday, November 9, 2018.

For many people in Louisiana, credit card bills are on the rise. This reflects a national trend: In the first three months of 2018 alone, household debt grew by $63 billion across the country. This marked the 15th consecutive quarter of growth in the nation's personal debt burden. Americans collectively owe $13.21 trillion in household and personal debt, including $815 billion in credit card bills and $1.23 trillion in outstanding auto loans.

Debt has become a way of life for Americans, and it can be difficult to find a way out. In the first place, people who are in debt need to understand exactly what they owe. They should list their debts, including the creditors, interest rates and monthly payments. In addition, people are entitled to a free annual credit report from each of the major credit bureaus. By reviewing their credit report, they can gain a complete listing of creditors as well as note any mistakes to petition for their removal.

This information can help debtors to create a repayment plan. People can prioritize paying off the debts with the highest interest rates in order to eliminate the fastest-growing burdens first. Compounding interest means that interest is constantly growing, so reducing the principal can play a major role in helping to cut down on interest repayments over the years. The longer it takes to repay the loan, the greater the amount of interest that will be charged.

Sometimes, the burden of debt is simply too great, and people are unable to pay it back; this is especially true when people's lives have materially changed due to a job loss or costly medical bills. A bankruptcy lawyer may provide advice on how personal bankruptcy might help people find debt relief and move forward into a new financial future.