Many people living in Mississippi are aware that bankruptcy is one option for debt relief. However, national statistics show a decline in bankruptcy cases in recent years.

While reasons for the decline are not entirely clear, many attorneys have put forth some ideas. Some have noted that the reasons why individuals file for bankruptcy in the first place have been mitigated. Unemployment numbers are down, which means people have more income they can apply toward debt. In addition, the Affordable Care Act has provided people with health insurance coverage, possibly reducing high levels of medical debt.

Other reasons for low bankruptcy rates may be less encouraging. Some debtors simply cannot afford the fees and court costs required to file for bankruptcy. Furthermore, many people carry student loan debt, which is very difficult to discharge in bankruptcy. As a result, individuals with significant debt burdens may feel as though there is no reason to bother filing for a discharge of their debts.

Still, bankruptcy remains an effective way for some people to cope with unmanageable debt. In cases where debt can’t be discharged, bankruptcy might provide some relief by granting automatic stays against collection activity. In a Chapter 13 bankruptcy, debts can be repaid as part of a three- or five-year repayment plan. This could make it easier for someone to regain their financial footing.

Individuals who are considering bankruptcy may benefit from consulting with an attorney. The lawyer could review the client’s circumstances and make suggestions regarding debt management options, including Chapter 7 and Chapter 13 bankruptcy.