Latest Economy Statistics on Bankruptcies, Foreclosures and Jobs

For individuals facing potentially difficult financial circumstances, it’s important to get a sense of what’s happening elsewhere, and what the entire economy is looking like as of late. Here, we’ll showcase some of the latest economy statistics you should be familiar with, touching on subjects including jobs, foreclosures and bankruptcies.

All of those areas are related, of course. As unemployment rates rise, foreclosures and bankruptcies rise in tandem, and the opposite is also true. That’s why it’s worthwhile to look at the entire picture together to get a sense for trends and developments.

According to statistics from RealtyTrac, in July 2015 the United States foreclosure rate was 1 in every 1,057 homes. This is highly variable on your local state, though. For instance, Florida has the highest foreclosure rate in the country, with 1 in every 408, more than double the national average.

According to the Bureau of Labor Statistics, the unemployment rate is 5.3% for July 2015. This is one of the best indicators of the strength of the economy overall, and the news is good.

The 5.3% unemployment rate, the 2nd consecutive month at that level, is the lowest unemployment rate stretching back to April 2008. During that stretch of years, the unemployment at one point nearly doubled the current rate, at 10% in October 2009.

One place to look for bankruptcy statistics is via the total number of filings received in U.S. bankruptcy courts, via For the 12-month periods ending on June 30th, 2014 and June 30th, 2015, respectively, filings are down 12 percent, with 879,736 comparative to 1,000,083.

Look back farther, and signs of economic relief are even greater and more stark. For instance, in 2010, there were 1,593,097 total bankruptcy filings. That was the highest total of any year during the recent economic crisis and crash, and nearly double the last yearly level.

So what does it all mean? More people are working, less bankruptcies are being filed, and foreclosures are down across the country. That’s good news overall.

Of course, general trends don’t mean that your specific circumstances are magically relieved. If you’re facing a financial crunch, including credit card debts, facing a risk of foreclosure, or thinking about bankruptcy, then it’s important to speak with an experienced attorney in your state who may be able to help.

You are never without options, and certain solutions may provide far superior outcomes than you had anticipated. As always, it’s important to be armed with as much information and assistance as you can get.

How Bankruptcy Lawyers Will Help You Out of Your Sticky Financial Situation

The word “bankruptcy” tends to strike fear into our hearts, especially if we’re going through financial trouble. But most people can’t see themselves ever filing for bankruptcy. The process seems like it’s made for failing businesses, government bodies, and other organizations. But personal bankruptcy laws exist to protect citizens who find themselves struggling with severe debt. If your finances drop into the red zone, taking the following steps will get you back on your feet:

Assess the Damage

Look closely at your financial portrait. If you owe large sums to multiple creditors, if collectors are calling your house, or if you find yourself paying for essentials with a credit card, you should start to consider remedying your situation. Begin by tallying up your financial assets – bank account balances, retirement funds, stocks and bonds, real estate, vehicles, and anything else of value. Once you have a grand total, compare it to the amount you owe. If your assets are worth less than your total debts, you should seriously consider filing for bankruptcy.

How Do I File?

You may voluntarily file for bankruptcy as soon as you determine it’s necessary. Alternatively, you may be compelled by your creditors to file. However your legal process originates, don’t try to navigate it by yourself. Get in touch with bankruptcy lawyers who will look closely at your circumstances and advise you on how to proceed. There are two different claims you can file, so an attorney will help you determine the legal route that best serves your interests.

Filing a Chapter 7 Claim

A Chapter 7 claim is fairly straightforward. If approved, this claim liquidates your assets and uses them to pay off a large chunk of your debt right away. In other words, it turns most of what you own into cash, and then distributes this cash among your creditors. It sounds scary, because you lose most of your holdings. But it’s not the end of the world – many people bounce back and rebuild their assets without all that debt holding them back. Especially with trusted bankruptcy lawyers on your side, this process can lead to a much-needed fresh start.

Filing a Chapter 13 Claim

Since they involve seizing most of the filer’s holdings, Chapter 7 claims aren’t great for people who own businesses, property, and other major assets. When you have large properties that you don’t want to lose, a Chapter 13 claim is the better choice. It allows people with consistent, predictable annual incomes to pay off debts over a three- to five-year grace period. Once a judge approves a Chapter 13 claim, creditors must stop contacting the debtor. The debtor then continues to work, paying off his or her debts as best they can during the grace period. No property or other assets are liquidated in this process.

Bankruptcy lawyers will tell you: filing isn’t so scary, and can drastically improve your situation. If you’re letting unpaid bills stack up and trying to ignore them, know that you can pursue legal options to relieve the stresses of debt and protect what you own.

Used Car Loan – A Shorter Loan Term Is a Happy Term

According to data released by Experian, 10.1 percent of all current used car loans are longer than six years – this shows a rise of 11.5 percent over 2012. It is the age of longer terms and many car buyers are opting for it because the cars have become costlier and car budgets have become smaller.

A couple of years back, 60-month loan term was the trend. Today, lenders are offering 72-month terms. Few car buyers have even received 98-month loan terms for buying cars. If you are in the car market and shopping for a used car, lenders will offer you longer terms and lower monthly payments. You may consider it a good alternative because of your over-stretched budget. You already have several payments to make by utilizing the low-household income. And, longer term may seem to be the only affordable alternative.

But, you cannot be more wrong. Here are reasons to help you understand the reality of longer term loans.

1. You spend More Money in Interest

When you opt for a used car loan with a longer loan term, you end up paying more money in interest than you will pay when you select a shorter term. Let’s take an example for it.

Scenario – 1

Car Loan – $10,000

Interest Rate – 4%

Loan Term – 4 years

Monthly payment- $225.79

Total Interest – $837.95

Scenario – 2

Car Loan – $10,000

Interest Rate – 4%

Loan Term – 7 years

Monthly payment- $136.69

Total Interest – $1 481.80

So, if you want to save a considerable amount of interest, you must opt for shorter loan terms. Don’t get fooled by lower monthly payment. It is just lender’s way of attracting you and earning more bucks.

2. Shorter Life of Used Cars + Longer Loan Term = Higher Problems

There is one more reason for choosing a shorter term while buying a used car. Pre-owned automobiles have a shorter life in comparison to new cars. So, if you opt for a longer term, you will end up with an upside down car loan. You will owe more money on the car than its worth. This situation can create a problem when you try to sell or trade the automobile. It will also be a problem in a situation when the car is destroyed in an accident.

Now, when you opt for a shorter term, you have to manage slightly higher monthly payments. To tackle higher monthly payments, you have to reduce the loan amount. Here’s how you can do it:

a) Make a smaller down payment by utilizing your savings or

b) Trade-in your old car or

c) You can choose a car with a lower value.

It is quite understandable that making higher payments can be an inconvenience but remember that a short-term inconvenience is better and affordable than a long-term loss.

So, remember to choose shorter loan terms while shopping for a used car loan.

The Ins and Outs of the Car Repossession Process

When a lender finances a car, they retain the right to repossess it if the repayment terms are not paid as agreed. Each state’s laws set limitations on lenders repossessing automobiles. Most states repossession laws are modeled after article 9 of the Uniform Commercial Code (UCC). Article 9 states that you must be in default on a loan before the repossession process can begin. The definition of default will be disclosed in the financial loan repayment agreement. Most loans have language stating a default starts after one, two, or three missed payments. Once the loan is in default according to the financial agreement documents, the lender has the right to take possession of the car. In most states, once the auto loan falls 90 days behind, the lender may reclaim the car. For specific terms of the loan and any repossession actions, please refer to the financial loan repayment agreement; which is signed by the purchaser of the car.

The lender can pick up the car from any location including: (1) your home, (2) work, or (3) other place where it is being stored. In most states, the lender can take the car without a court order. Although, many state laws specify a car can only be repossessed if the lender can do so without “breaching the peace”. The term “breach of peace” means that the lender is able to obtain possession of the car without any threat to the borrower or use of force. A breach of peace could be as simple as the borrower telling the creditor they will not cooperate. If force or threats are used to gain possession of the car the lender may be liable for any damages caused from the repossession. The lender, at this point, must seek judicial permission. They must document the default and wait for the court to issue permission to repossess the car. Once the court gives permission to repossess the car, the lender will likely request that the local police assist in the repossession. Once the creditor has control of the car they can repair it if they choose before selling the car..

When the lender takes possession, they must give notice to the borrower of their intent to sell the car. At this point the borrower’s only option would be to pay the loan and additional costs associated with repossessing the car in full. If the borrower chooses not to pay the loan and costs prior to the notified date of sale, the car can be sold at auction. If the creditor sells the car for less than the balance of the original loan then they can file a deficiency judgment against the borrower for the difference. In order for the creditor to put a deficiency judgment against the borrower the car must be sold commercially (no private sales).

New Bubble Rising: Sub-Prime Auto Loans

In the fall of 2007, the economic meltdown in America began, and proceeded to go sideways in a series of domino-like events. Yet before the crash, word on the street spread quickly as a real-estate buying frenzy took flight like never before. “Get it while you can” went viral, and those who otherwise would not qualify for a loan, took full advantage. Sadly, after a few years, everything changed; going from bad to worse as untold numbers of Americans started losing their homes to foreclosure.

Banking practices dubbed “foreclosure-gate” and “fraudclosure” were put under the microscope. On the front end, Americans started to find out that realtors had been racking up huge commissions and under-the-table lender bonuses while many back-end mortgage brokers turned a blind eye to underwriting documentation of inflated income levels, fake home appraisals, etc.

The rest is history.

Eventually, a larger deception was exposed; the financial industry well-understood there would be a high percentage of sub-prime-loan defaults and that they stood to profit either way. Despite this growing awareness that sub-prime loans were simply another profit center for the financial sector and not the little guy; in 2014, nothing but the names have changed!

Wall Street bankers carry on and the government continues to permit sub-prime loans only now under the guise of auto loans. The title of this October 7, 2014 article says it all, “The new sub-prime is in auto loans: One third of all new auto loans are of the sub-prime variety.” Repossessions are up 70 percent. It goes on to say,

“What is telling here is that much of this debt growth has occurred under the umbrella of recovery. If things are going so well, then why are so many loans being made to those with bad credit?”

Good point! Almost exactly four years ago on ABC News Today, the then Secretary of Housing and Urban Development, Shaun Donovan, said (referring to housing foreclosures) that there does not seem to be any “underlying systemic problems,” while referring to his review of foreclosure-documentation-issues of specific lenders and banks who might not have followed the rules. Yet his “bad apple” approach could not be farther from the truth. The growth of sub-prime auto loans along with the inevitable rise in repossessions is nothing more than the last gasps of a broken debt-burdened financial system: a vampire-like, self-serving attempt to survive at the expense of its victims.

Baby Boomers find themselves in the most vulnerable position for taking on new debt given all they lost in the 2007-8 economic debacle and their dwindling time to replace it. The best advice, for all in this economy is to get out of debt and increase your number of revenue streams. That is, if you do not want to become another New-Normal statistic. It is all about getting re-inspired by finding and implementing age-appropriate cash-flow activities to ensure later-years financial well-being Reinspirementâ„¢, not retirement, is the key to the economic times we live in.