Where's the US market going? Opinions range between doomsday prophecies to cautious optimism. Yet, even as an election year approaches and information "spin" begins to increase from news agencies, it's clear that the economy continues to be not doing well. I consulted a Long Island bankruptcy attorney and here what i found out.
Unusually, bankruptcies are diminishing nationwide. Signaling what could be a nationwide trend, the U.S. Bankruptcy Court for the Western District of New York reported a 17.5 percent drop in bankruptcy filings in Buffalo and Rochester. While numbers for Manhattan and Suffolk counties haven't been announced yet, the National Bankruptcy Research Center and American Banking institute reports a nationwide drop nearing 8 percent during the first half of 2011.
What does all this mean? Is the economy really getting better? Must we be hopeful? If the credit crunch and nationwide debt are taking such a toll nationwide, why aren't bankruptcies skyrocketing?
The standard opinion, however, is that recent downward trends in bankruptcy aren't a signal of a developing economy. Foreclosures in the America have bogged down to a crawl: new regulations created to curtail foreclosure-happy banks have terrified lenders. A lot of people that choose bankruptcy do so to protect a home. In addition, there's an general decline in credit creation: because the economy's in such bad shape, Americans want to spend less money. Finally, the price of going bankrupt is prohibitive, forcing most Americans to find other means to endure financially.
Perhaps the Federal Government is getting in on the fact that a large number of banks violated the law during the homeowner credit crisis. As the government rose to defend the rights of homeowners, regulations were established to protect them: and they worked. Banks have become not only terrified to lend, they're terrified to foreclose. It's become an unfortunate catch-22 for those who would like to purchase property. Plus, the situation has reduced foreclosures, and lowered the desire for Americans to file for bankruptcy to protect their home.
Americans are cutting back. Overall, consumers have wised up, and are weathering the economic chaos by not spending as much. Fewer homes, fewer boats, fewer cars, fewer motorcycles, fewer flat-screen TVs--fewer overall big-ticket credit items are being bought nationwide. As a result, Americans have less in the way of assets to protect, making Chapter 7 a less inviting remedy for financial debt problems.
The government has made it harder to file for bankruptcy. The means test is a difficult task to accomplish without a lawyer. However, it's not impossible. If you need to know more about declaring bankruptcy, realize that it can be done with the help of a specialized lawyer.
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