People in Virginia who have filed for bankruptcy or who are considering filing for bankruptcy might wonder if they can still buy a house afterward. It is possible to purchase a home after bankruptcy, although certain conditions must be in place for this to happen.
Virginia residents who are filing for Chapter 13 bankruptcy can exclude 401(k) deductions when they are calculating their disposable income for their bankruptcy payment plan, even if the contributions were not made during the six months preceding the bankruptcy. This is according to an Oct. 30 ruling by an Illinois bankruptcy court.
The patterns of people filing for bankruptcy in Virginia and around the country often correlate with economic trends. An expanding economy and lowered unemployment rate may lead to fewer bankruptcies while downturns or higher interest rates may force more debtors to seek relief through the courts.
Consumer borrowing in Virginia and around the country slowed in August according to a report released by the U.S. Federal Reserve on Oct. 6. The central bank says the nation's consumer debt load rose by $13.1 billion in August after surging by $17.7 billion in July, but the increase is far lower than the $16 billion predicted by experts. The figures pegged the annual rate of credit growth back to 4.2 percent. The annual rate stood at 5.7 percent at the end of July.
Virginia debtors will experience both short- and long-term effects after filing for bankruptcy. Typically, people falling behind on payments have declining credit scores. Although declaring bankruptcy represents a negative on a credit report, people often gain points on their credit reports in the immediate aftermath. Researchers determined that the short-term rebound occurs because the debtors' scores had dropped so low that the initial clearing out of debt improves their ratings.
Chapter 13 filers in Virginia should know that getting a home during or after bankruptcy is not impossible. While it can be challenging, renting or purchasing a home can be a reality for many filers.
Many people in Virginia who are struggling with medical debt should not expect too much from two recent reforms. Starting Sept. 15, credit bureaus will be required to wait 180 days before reporting medical debt on a person's credit report. Furthermore, if a bill goes into collections and is paid by an insurer, it will be deleted from the credit report.
Virginia consumers who are considering bankruptcy may wonder what it will cost them. Even if a person does not use an attorney, there are filing fees. These fees vary depending on what kind of bankruptcy is being filed.
Virginia residents with credit card debt may be looking for the best way to deal with these obligations. While debt settlement is one option, it is important that people consider all the facts before choosing that alternative. Debt settlement can have a negative effect on the credit score and financial future of the consumer, and not all consumers who use this option are aware of this fact until they have already contracted for these types of services.
American consumers now have a total debt balance of $12.84 trillion according to a report published by the Federal Reserve of New York. The report covered the second quarter of 2017, and it represented a $552 billion increase from this time last year. Higher levels of mortgage, auto and credit card debt were cited as factors for the overall increase. It was noted that there was a jump in credit card delinquency rates.