Bankruptcy

What is Financial Distress?

By Jim Hawkins

I?m new to teaching, so a lot of times I encounter new terms.  I started working on a paper last year about the relationship between fringe banking (payday loans, rent-to-own, etc.) and financial distress.  I realized half way into the project that I really didn?t know what financial distress meant.  The concept comes up a lot.  Seriously, I mean really a lot.  But, it is not defined very often.

I?ve looked at the 300 or so times financial distress comes up in law review articles on Lexis, and I still am left without a clear sense of what the word means.  I?ve settled on two definitions for my paper, but I?m curious about what people mean when they say ?financial distress.?

Full post as published by Credit Slips on February 18, 2010 (boomark / email).