Despite the $2.2 trillion stimulus package of the CARES (Coronavirus Aid, Relief, and Economic Security) Act in March 2020, the impacts the novel coronavirus is having on the local, national, and global economies will most likely continue, potentially causing a recession that may result in the same severities as the 2008 Great Recession. In fact, some studies show the economic downtown due to COVID-19 may become a full-blown depression. Despite the dire financial reports and record rise in unemployment rates, individuals and their communities can implement many methods to weather difficult financial times, no matter how widespread the fallout. If you’re already experiencing the effects of the current economic downturn, consider the many options for debt assistance in Owatonna, MN, and the surrounding area, including filing for bankruptcy. With the help of Behm Law Group Ltd., you can use the bankruptcy process for long-term, effective debt relief during this time of crisis.
The projected recession will affect millions of U.S. citizens and businesses for an unforeseeable amount of time. Because of this uncertainty, many people will have difficulties meeting debt payments on time and they may accumulate delinquencies. Some options always available, such as debt settlement, loan consolidation, and debt workout, require direct communication with creditors or include the involvement of third-party agencies. In addition, the CARES Act provides several other options for debt assistance, including loan extensions, and payments deferments and modifications. Likewise, some private lenders are providing assistance programs and case-by-case work outs of debt.
While all of these non-bankruptcy debt assistance options vary in effectiveness, presuming you find a trustworthy third-party who will work with you in good faith instead of one of the many bad actors who simply want to make money off of you and cut and run, as the months wear on, you may need to do more for sustained and permanent debt relief in the long term. For many people, this will be the filing of a bankruptcy petition.
Bankruptcy is one of the longest used debt assistance options during times of recession and depression in the United States. In the 2008 recession, over 4 million non-business bankruptcy cases resolved individual debts in the time it took to turn the economy around (between 2008-2010). The history of bankruptcy successes during times of economic recession is a sign of hope for the future.
Bankruptcy is an effective tool whether you file to resolve a large portion of credit card debt and medical bills as a direct result of the COVID-19 crisis, or if you need to restructure your mortgage and other secured debts into a manageable repayment plan. During this current health and financial crisis, the majority of debt increases will be medical bills and credit card debts, both of which are dischargeable in bankruptcy. Other common debts taken on in a recession, such as tax debts and car loans, can also be resolved with the bankruptcy process and payment terms that are more favorable to you can be established.
To learn more about using bankruptcy as a form of debt assistance in Owatonna, MN,
during a recession, contact Behm Law Group Ltd. at (507) 387-7200 or stephen@mankatobankruptcy.com today.
