Dealing with debt and the risks of seeking aid during a crisis

| Mar 24, 2020 | consumer bankruptcy | 0 comments

With orders coming in advising people to remain at home to reduce the spread of the coronavirus, there may be many individuals who are being forced to take an unexpected leave from work. Unfortunately, this temporary stay could leave many worried they might not be able to keep up with monthly financial obligations. Times of crisis may lead some to seek monetary assistance through the available outlets and while this may provide immediate aid, such a decision could also bring about prolonged bouts with high levels of debt in the future.

During times of crisis, experts indicate that many of those who struggle to make ends meet could turn to outlets that provide cash advances or payday loans for assistance. While it may seem necessary at the time, such aid could come with a price, as such loans typically come with substantial fees and a limited period for repayment. Those who seek relief through cash advances on credit card accounts could face similar concerns, as interest rates on similar endeavors could reach amounts as high as 25%.

While personal loans may carry lower interest rates than the alternatives, studies indicate that there could be a variety of risks associated with seeking aid through similar lines of credit. In some cases, times of financial strain could also lead some to consider dipping into retirement savings to get by. Prior to deciding on such a path, one might benefit from seeking advice on the possible risks associated with borrowing from retirement accounts.

Understanding the possible risks associated with seeking relief from the trials of debt during times of crisis can be a challenging endeavor. Those who face similar concerns and wish to know more about the available options to help protect their finances could benefit from seeking legal counsel as soon as possible. A bankruptcy attorney can help a client in Kentucky make informed choices about the situation and assist him or her in pursuing the necessary relief through the proper channels.