According to an article at CNN credit card delinquency rates jumped 11% in the first quarter of 2009 and the average borrower’s debt rose 4.09% from the previous year to $5,729.
The article said:
“This increase could be an indication that tax refund checks, typically used to pay down balances in during the first quarter in years past, are now being used to cover daily living expenses,” said Ezra Becker, of TransUnion’s financial services group, in a written statement.
Becker is probably right. Not only are credit card borrowers using their tax refunds to cover daily living expenses they’re also using their credit cards, which is causing their overall debt to increase. Workers in Dallas-Fort Worth and nationwide are facing massive job losses and extended unemployment at a level that hasn’t been experienced since the 1980’s and they’re not prepared. No savings, high debt levels, job losses and mortgages that are resetting at a higher interest rate are all factors colluding to create rising credit card debt and delinquencies. Faced with few options many credit card borrowers are using debt simply to keep a roof over their head and avoid foreclosure. Unfortunately this use of credit card debt is only a temporary “fix” which isn’t really a fix at all. Once the credit cards are maxed out, the creditors starting calling, lawsuits are filed and foreclosure becomes imminent.
That’s why debtors who are finding themselves dependent on credit card debt to pay for their everyday expenses should seriously consider filing bankruptcy. Bankruptcy will discharge credit card debt and help the debtor save their home from foreclosure . The important thing for debtors is that they don’t continue to dig themselves into a financial hole. Contact a Dallas-Fort Worth bankruptcy attorney today to find out how bankruptcy can help alleviate your financial troubles.