Texas, like many other states, has seen an increase in people filing for bankruptcy over the last few years. There can be any number of reasons for people to seek protection under the bankruptcy laws. Loss of a job, overwhelming debt and falling home values are only a few of the challenges people face in this weak economy. What might surprise some people, though, is the increasing number of college students and graduates who are now filing for personal bankruptcy.
Student loan debt is often given as one of the main reasons these individuals are choosing personal bankruptcy when they fall severely behind in their payments. Over the last several years, more people have gone back to college in order to get the degrees they need to get the edge when hunting for scarce job opportunities. As more people start college or return for advanced degrees, the level of outstanding student loan debt goes up in proportion. It has been estimated that citizens now owe more in student loans than they do on credit card debt. The College Board estimates that full-time undergraduate students borrowed an average of $4,900 last year.
Experts say that they recommend people only borrow what they need to for school, and try to get a job to pay for living expenses. They estimate that student debt is climbing because more people are going to school full-time and taking out loans to finance the entire thing.
While crushing student loan debt may be one reason for Texas residents to declare personal bankruptcy, it is not the only reason individuals are choosing this option. As mentioned above, loss of a job, credit card debt and possible home foreclosure are often cited as reasons people seek financial protection under the law. Increased medical costs and the cost of long-term care are also reasons people need help.
Filing for bankruptcy is one way to get a new start in these hard economic times. For those who may be considering this option, consultation with an experienced attorney may prove to be beneficial. An attorney may be able to explain the various types of bankruptcy and how the process works.