During this unsure economic time, many of us look to the past to see how we reacted, what worked, and what didn’t. Since the first Great Depression in the U.S., there have been many ups and downs in the economy. One notable “down” was the 2008 financial crisis. The unexpected depression during that time was a recent crisis that took place in an economy very similar to the one today.
While there are many components to any depression, the 2008 crisis is one we can most likely prevent from occurring again. However, if any financial crises happen in our future, individuals and businesses alike can find solid ground and protection from the relief a bankruptcy case provides. If you’re struggling to make ends meet during these challenging times, Behm Law Group, Ltd. can help you find debt relief in Marshall, MN and the surrounding area through the process of filing for bankruptcy relief.
The financial crisis of 2008 saw many bankruptcies, including Lehman Brothers, who filed the largest case of all time. Individuals, small businesses, and Fortune 500 companies were all affected financially during this time. A combination of risky investments, the collapse of the housing market, and various other bad choices made by large players in Wall Street led to a severe financial crisis and a trickle-down effect that made everyone change the way they looked at our economy.
In addition to many of the large bankruptcy cases like Lehman Brothers, thousands of people across the U.S. found themselves filing bankruptcy to protect their homes and find debt relief. For individuals then (and now) there were two main options.
If their income was lower than the state median income, an individual could file for Chapter 7 bankruptcy and have their non-exempt assets sold in exchange for the discharge of debts. In a Chapter 7 case there are exemptions filers can use to protect the vast majority of their assets (in most cases people are able to protect all of their assets) from liquidation, depending on their financial circumstances. In 2007 there were 467,248 non-business Chapter 7 cases. After the crisis in 2008, that number jumped to 949,002 in 2009 and 1,105,534 in 2010.
A debtor’s other option was to file for Chapter 13 bankruptcy. This was an option for those with an income higher than the state median income who were ineligible for Chapter 7. Chapter 13 worked to restructure debts into a manageable repayment plan lasting three to five years. In 2007, there were 307,521 non-business Chapter 13 cases. In 2009, that number increased to 393,786, and in 2010, rose again to 430,583.
All of the bankruptcy cases born out of the 2008 crisis were effective in many ways, helping to rebalance our economy and provide much needed debt relief to filers. To learn more about filing for debt relief in Marshall, MN during today’s difficult financial times, contact Behm Law Group, Ltd. at (507) 387-7200 or stephen@mankatobankruptcy.com.
