As the economy declined, much of the tourism in Florida went with it. Businesses and their employees who used to rely on tourists for consistent income have had to face the reality that fewer people have been visiting Florida in recent years. This put financial strain on people who were already struggling to make ends meet.
When most people think about chapter 7 bankruptcy, low-income individuals usually come to mind. And chapter 7 bankruptcy is often an option when people lose their jobs or find themselves making too little to pay down their debts.
In 2009, the Target National Bank sued a consumer, saying that she was delinquent on payments for her Target store credit card. Five months later, the company dropped the lawsuit, but the consumer says that the damage was already done.
Last week, we talked about individual credit reports. We told you that Equifax is one of the three major credit reporting companies when it comes to individual credit scores. But Equifax does not only provide credit reports about individual consumers. This week, the company released a report about the nation's credit card debt as a whole.
There are many reasons that people find themselves struggling with debt. For some, it is largely out of their control. Job loss and serious illnesses or injuries can leave families without much needed paychecks. But for others, simply not understanding basic financial principles can play a large role in their financial struggles.
Last year, a record number of people and businesses filed for bankruptcy protection in Florida and across the country. In fact, bankruptcy filings in 2010 topped the levels we saw in 2005 before the bankruptcy laws were changed.
With Florida's real estate market still falling and the foreclosure rate continuing to climb, many have speculated about the wisdom of what they call "strategic default." The term refers to people who could afford to keep making their mortgage payments but owe more than the home is worth. If these individuals default on their payments and accept foreclosure, it is referred to as strategic default.
In February 2010, Florida and four other states received money from the federal Troubled Assets Relief Program. Those fund were designed to help homeowners avoid foreclosure. Until now, all four of the other states instituted programs to distribute that money to struggling homeowners. This month, Florida will become the last of the five to do so.
As many unfortunate homeowners have found out, the foreclosure process in South Florida can be nearly impossible to navigate. Phone calls to lenders to go unanswered. Pleas for loan modifications are ignored. And in the end, homeowners find themselves out of their homes and feeling like they were not given a chance to find an alternative solution.