LUFKIN, TX (KTRE) - It can happen to anyone. Consumer Bankruptcy Attorney, David Stephens says, "99 percent of the people who walk through my door say I never thought I would be here but this happened."
Debt overwhelms many Americans leaving them with no choice but to file for chapter 7 or 13 bankruptcy.
"People lose their jobs, people have lots of health problems, just unexpected catastrophes," says Stephens.
Back in 2005 Congress passed laws that made it more difficult to file for bankruptcy, because so many people were using that option. Afterwards, the numbers went down 90 percent. But last year, that number started to creep back up thanks to a recession, higher gas prices, and layoffs, and times will only get worse.
Stephens says, "All predictors are saying that the bankruptcies are typically going to increase nationwide over the next few years."
But in East Texas, bankruptcy is not happening as often. "We're actually down about 28 percent in the last year of 08 of our bankruptcy filing."
That doesn't mean it still can't happen. Stephens says the number one reason his clients come to file bankruptcy is because they are drowning in credit card debt.
He adds, "Never just pay the minimum always at least try to pay more the minimum, or if you can get to point to pay them off every month or don't use them."
So during these tough times, it's important to think smart, and be practical. And if you do hit a financial dead end, don't think of bankruptcy as the kiss of death, it could be saving grace.
"Bankruptcy is just a tool to accomplish what you need to accomplish saving the house, saving the car, not allowing the creditors to harass you day and night to make you do something drastic. It is my belief that it is a necessary tool," Stephens conclude.