Bankruptcy

Oklahoma Residents Suffer Financial Difficulty- Bankruptcy May Be the Solution

By writer

Oklahoma is not a state renowned for extravagant living. So why does bankruptcy information show Chapter 7 filings astonishingly higher in Oklahoma, (.6% of their state population), than in the rest of the nation? Could it be that Oklahomans are uniquely irresponsible about credit card debt, or are their rival neighbors the Texas Longhorns spitefully usurping their business?(Hook ?em!)

A new study of bankruptcy information by economists at Brigham Young University suggests something different– the percentage of personal bankruptcy has surprisingly little to do with the state?s economy.

The bankruptcy information study, released June 2009, examines the 28,000 personal bankruptcies filed between 1999 and 2000. The states with the most ruthless wage garnishment laws, in Oklahoma, Tennessee and Utah, had higher bankruptcy information rates than anywhere else in the country. These states? wage garnishment laws allow creditors to dip into the pocket of struggling debtors, regardless of bankruptcy protection?making them twice as likely to file Chapter 7 a second time and blowing up bankruptcy information indices.

The year 2006 saw our bankruptcy rates diminish by 9.3%, but not because of a booming economy?consumers chafed at new bankruptcy policy. 2006 made Chapter 7 consumer bankruptcy seem inaccessible by mandating a credit counseling pre- bankruptcy filing, when in truth the requirement was negligible. Consumers also cringed anew at a new ?means test?, adding bureaucratic paperwork to the Chapter 7 requirement that your income is less than the state?s median?usually under $30,000, and much lower for states (Oklahoma! Utah!) with an abundance of minimum wage and farming jobs. As a result, ineligible consumers must file Chapter 13, 4 times more expensive in legal costs and binding with a payment plan. Most who straddle the line of the state median income can?t weather the cost of Chapter 13 and will have to eventually re-file with Chapter 7?a Chapter 13 misdiagnosis that only briefly delays Chapter 7 only to double the cost for you!

Get in touch with a skilled Legal Helpers attorney with a stern focus on bankruptcy today.

Full post as published by Consumer Bankruptcy Blog from Legal Helpers on July 17, 2009 (boomark / email).