Americans are piling up credit debt
On Behalf of O’Brien Law Firm, LLC
Posted on: March 14, 2018
Mississippi readers with credit card debt are not alone. According to a report by WalletHub, in 2017, Americans added the most credit card debt since 2007. Further, the Federal Reserve estimates that the total amount of U.S. credit card balances currently exceeds $1 trillion.
WalletHub reports that Americans added $92.2 billion in credit card debt in 2017. Of that, $67.6 billion was added in the final quarter, which represents the highest one-quarter jump in three decades. The latest numbers are part of a trend. Between 2015 and 2016, U.S. credit card debt increased by $44 billion.
According to experts, one reason for the sharp increase in debt is that charge-offs, or uncollectable debts, are at historically low rates. This means that banks feel more comfortable extending credit to Americans with subpar credit scores. Another reason could be medical expenses. According to the Centers for Medicare and Medicaid Services, Americans were responsible for paying $338 billion in out-of-pocket health care costs in 2015. These costs included deductibles, co=pays, office visits and uncovered medical procedures. Apparently, many people paid for those costs with credit cards. WalletHub reports that 62.3 percent of Americans say health care expenses make up a portion of their credit card debt.
Mississippi residents who are seeking relief from credit card debt may wish to consider filing for Chapter 13 bankruptcy. Under this chapter, consumers repay their obligations over a period of three or five years pursuant to a court-approved plan. Any remaining credit card balance would generally be discharged upon the successful completion of the plan. An attorney can outline the eligibility requirements.
Source: Yahoo Finance, Credit card debt has now reached pre-recession levels“, Brittany Jones-Cooper, March 8, 2018