I’m seeing a real change in the people seeing me about filing bankruptcy.
Used to be, the problem was credit card debt, unemployment, or divorce.
A surprising trend over the past six months is developing.
I acknowledge the sample size is small. Statistically, you can challenge the significance, but here are the trends.
My office is crowded with single women scammed on dating sites; on line borrowers from virtual lenders; and small retailers.
Scam victims tap their credit
The women are single, moderately prosperous, and looking for a romantic connection. The men are elsewhere, seemingly interested, and broke.
My clients each maxed out their credit, took out loans and even took lines of credit secured by their homes to help their “boyfriend”.
And when the credit was tapped out, the “boyfriend” was gone.
The debt hung around, and the women next met a bankruptcy lawyer.
Virtual lenders supplant credit cards
On line lending is the new source of money for the financially challenged. Fire up the computer and order up some cash. Give the lender access to your bank account.
Never mind that the rates are awful, and the ease of borrowing is deceptive.
I’ve seen several instances where the loan amount ranged from $50,000 to $90,000.
It’s my guess that the borrowers are even less likely than normal to read the terms, understand the transaction.
The deal doesn’t even require an ink signature.
I’ll need an ink signature, however, on the bankruptcy petition.
Small retailers reeling
You’d think that any retailer that survived the Great Recession was solid and good for the long haul.
Not so, apparently.
I’ve seen two in the last two months who can see they won’t make it.
Traditionally, small business folk come to see me when times are tough and they want the magic wand to fend off creditors.
Not so for this duo. Each arrived in my office ready to throw in the towel.
Bankruptcy relief beckons
If there is a lesson here, it is that money troubles touch lots of people, in different realms and under different circumstances.
The stereotype of the reckless and self centered spender is just that: a stereotype.
And mercifully, you don’t have to explain how you got into financial trouble to use bankruptcy to get out of trouble.