Mississippians face financial problems and personal bankruptcy

Following the economic crisis in 2010, the United States government established a government agency to provide some government oversight and intervention in the economy. The agency is the Consumer Financial Protection Bureau ("CFPB"). It travels around the country and meets with different local communities in order to understand their financial challenges, including personal bankruptcy.

The CFPB recently visited Mississippi. The agency spoke with all types of citizens: students, retired people, small business owners and families. The Mississippians discussed how the struggling economy has impacted their personal situations.

In particular, they focused on how borrowing money to eliminate debt that arises from home loans, medical expenses and education has become more difficult with the increase in the closure of local branches of banks. Mississippians believe that it is harder to get loans when there is limited face-to-face interactions with bankers or if it is difficult for a person to travel to a flagship bank location.

Another issue that the agency identified is the difficulty that borrowers run into when they get loans that they cannot repay. CFPB is interested in providing oversight to ensure that financial lending institutions do not engage in such practices.

In addition to the measures that the CFPB plans to take, there are also personal steps that Mississippians can take to combat their financial challenges and get debt relief. For example, in a situation in which individuals may have a loan -- like a home loan -- that they cannot repay, they must have a legal and financial plan of how to approach their outstanding debt.

In the case of an unpaid home loan, individuals can face the unfortunate situation of foreclosure. Filing for bankruptcy can be one tool that helps avoid foreclosure, and allow individuals to keep their home. Personal bankruptcy can be helpful because, once individuals file for bankruptcy, an automatic stay over debt collection is put into place.

While many Mississippians were grateful that the CFPB visited the state to learn about its particular financial challenges and help combat them. Mississippians still have a personal obligation to find ways to address their particular financial situations. Bankruptcy can be one solution.

Source: The Huffington Post, "Mississippians Report Financial Challenges to Consumer Protection Bureau," Bill Bynum, Sept. 24, 2013

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