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Stratford Bankruptcy Blog

Personal bankruptcy can set the scene for a new beginning

Those residents of Connecticut who have filed and completed a bankruptcy, and those who are contemplating doing so, can look forward to a fresh start and the chance to do things right the next time around. Successfully completing a personal bankruptcy is not the end of the world but instead a new beginning. It is a chance to wipe the slate clean and start over without the burdens of overwhelming debt.

Taking the following steps will assure that one takes advantage of the benefits of the debt relief received by the bankruptcy. The fact that one's credit will be negatively affected is not a solid barrier to rebuilding that credit. Within a year or two, the focused, positive-thinking individual can rebuild a respectable credit score and be able to take on future debt in a responsible manner. 

Chapter 7 bankruptcy can ease the financial woes of seniors

Consumer bankruptcy filings in Connecticut continue to be vigorous despite the relative recovery in the economy. For example, personal Chapter 7 bankruptcy filings have grown among senior citizens who are 65 and older.  The main reason for that increase is the high cost of medical debt, which has hit the older population particularly hard due to the prevalence of fixed or static incomes among them. 

Seniors are also hard hit because they are more prone to encounter a serious medical condition requiring extensive hospital visits or complex surgical procedures and treatment. Perhaps surprisingly, some seniors report that it was the best decision that they could have made under the circumstances. According to consumer bankruptcy attorneys, the most striking aspect of seniors trying to deal with overwhelming medical debt and/or credit card debt is the obvious intensity of the stress and anxiety they suffer by trying to keep up with creditors' and collectors' demands.

Tips for post-bankruptcy debt management

Moving beyond a bankruptcy is a chance for Connecticut residents to make a clean financial start. For many, this is a time of excitement, when everything seems possible and the burden of excessive debt has been removed. In order to make the most of this financial freedom, it is critical to begin making smart budgeting and debt management choices. 

One place to begin is by creating a comprehensive budget and automating that budget to the greatest degree possible. Using your banking software or a budgeting app can make it easy to meet all of your financial obligations and also set aside some money for savings. Some people even set their accounts up to direct a dedicated amount into a discretionary spending account, which can help to limit impulse buying. 

Medical debt may lead older individuals to personal bankruptcy

Older people often find themselves facing various medical issues. Though anyone of any age could end up with medical needs, older Connecticut residents may be particularly susceptible to developing health problems that could lead to significant medical bills. Unfortunately, elderly individuals may also have a more difficult time paying these bills, but personal bankruptcy may be able to help.

Unpaid medical expenses make up the number one reason that individuals file for bankruptcy. With the high cost of treatments, it is not surprising that numerous people have trouble attending to the bills they end up with after seeking medical attention. It was recently reported that 8 percent of bankruptcy filers are parties aged 65 or older. It was noted that the economic recession may have played a role in debts having a more significant impact on older parties.

Lularoe sellers filing for Chapter 7 bankruptcy

Some Connecticut readers may be familiar with the online retailer Lularoe. The company offers women's apparel and accessories, sold through local merchants running a home-based business. The company enjoyed substantial success in recent years, but it appears that some female Lularoe merchants are struggling to ply their wares.

At least 24 recent bankruptcy cases featured Lularoe as the business entity. In many instances, women achieved healthy sales for one or more years only to find those numbers drop off precipitously in recent months. It may be that the initial success of the company led more and more people to sign up as retailers, saturating the market. Of course, many different factors go into an individual's decision to file for bankruptcy, so it is not clear to what degree a Lularoe business factored into a bankruptcy filing. 

Personal bankruptcy often follows medical debt

When many Connecticut residents think about bankruptcy, they envision a scenario in which an individual has made numerous financial mistakes. In reality, however, it is entirely possible for someone to make all the right choices, yet still require personal bankruptcy assistance. An example lies in a retiree who filed Chapter 13 bankruptcy after facing insurmountable medical debt.

The man worked for decades at an automobile manufacturer. He then pursued another career as a locksmith. However, one day he fell violently ill, vomiting blood. When he sought emergency medical treatment, he learned that he would need a liver transplant. In the end, his medical debt surpassed $100,000.

In debt management, some loans are beneficial

It takes some time to learn how to responsibly manage debt. For many Connecticut residents, these lessons are learned over many years of experience. Debt management is a skill, and improving one's knowledge on debt related matters makes it easier to make informed decisions and achieve one's ultimate goals. In certain cases, borrowing money can further long-term financial goals. That is especially true for those who have gone through the personal bankruptcy process and are trying to rebuild a base of financial security. 

An example lies in purchasing a vehicle. Very often, a sudden and unexpected accident or car repair creates an immediate need for a new set of wheels. The manner in which a new car is purchased can have a lasting financial impact.

Should you file personal bankruptcy because of credit card debt?

Connecticut readers may know that most Americans have credit card debt. For some, however, this debt eventually becomes more than is reasonably manageable. When left unchecked, credit card debt can lead to financial struggles in other areas, and compounding interest can make a person feel like he or she will never get ahead. When overwhelmed by a credit card debt situation, credit card holders may wonder if they should file personal bankruptcy

Many consumers fall prey to credit cards because companies use certain ploys to draw people in by offering certain benefits. For example, many stores ask patrons if they would like to open a store credit card in exchange for a certain percentage off their purchase that day. While this may seem like an attractive offer, it can actually lead to problems in the future as more and more is charged to that card.

Debt management relief on high-risk loans to help some consumers

Consumers in Connecticut and throughout the country will soon get a break against the debt traps that place unreasonable burdens on them to pay back all or most of certain debt obligations at once. The Consumer Financial Protection Bureau (CFPB) just finalized a rule that requires certain protections regarding payday loans, auto title loans, deposit advance products and balloon payments in some longer-term loans. The relief will assist some consumers in facilitating better debt management measures to keep their debt from burgeoning out of control.

These types of loans often utilize predated checks that are used to pay off short-term loans, usually made in smaller amounts that are theoretically going to be paid off by the borrower's next paycheck. In auto title loans, a short-term loan is granted on the basis of the borrower's auto title being put up for collateral. The borrower may have to put up access to his/her checking account or auto title to get a longer-term loan that has a balloon payment at the end.

Avoiding accusations of Chapter 7 bankruptcy fraud

For most Connecticut residents, filing for bankruptcy is an unfamiliar process. Faced with the need to identify, list and value all accumulated assets, many people will make a number of mistakes. In some cases, those mistakes can be misconstrued as acts of fraud. That's why it's critical to work with a qualified Chapter 7 bankruptcy attorney throughout the process.

If a bankruptcy case presents unusual details, the trustee and court that oversees the process may determine that there have been acts of fraud. An example is found in the case of a former neurosurgeon who now stands accused of intentionally hiding assets during his personal bankruptcy. He now faces the risk of prison time in addition to a $250,000 fine. According to prosecutors, the man submitted a falsified financial statement to the court. They believe that he took steps to hide more than $300,000 as well as a valuable motorcycle.

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