Issues that often lead to bankruptcy in Missouri

On Behalf of | Jan 28, 2021 | Bankruptcy |

If Missouri residents were to take a survey about finances, most would undoubtedly say they have experienced financial challenges at some point in their lives. Both chronic and acute situations can cause financial distress. Sometimes, minor banking adjustments or lifestyle changes are enough to get things back on track; there are also circumstances where additional outside support may be needed, such as filing for bankruptcy.

These issues can throw finances out of whack

Understanding what causes debt is a step in the right direction to resolving serious financial problems. In the United States, there are several issues that often result in people being unable to meet their expenses, pay back loans or resolve other liabilities. If a person is experiencing financial crisis, it is helpful to assess the situation by listing every current cause of debt.

One of the most common causes of debt in this state and throughout the country is spending future money. For instance, a person might land a job for a specific amount of income, then make purchases on credit, thinking that he or she will pay off the balance when enough income has accrued. However, if job loss or income reduction occurs, there may never be enough funds to satisfy the debt. Chronic or sudden illness, as well as divorce, are additional issues that often cause serious debt problems.

An option that helps pay down debt and rebuild finances

Missouri residents may be able to eliminate debt by spending cash only to prevent new charges on a credit card account. However, many people have no way to pay medical expenses without using their credit cards. Regardless of the exact events that have caused a financial crisis, Chapter 7 bankruptcy is often a viable option to discharge debt and build a stronger financial portfolio down the line.

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Andrew Tarry