Mesa, AZ Bankruptcy Law Blog

Pro athletes often make far more money than an average person in their lifetime. But, in some respects, these athletes are no different from Arizona residents who have faced financial difficulties for a variety of reasons. Though they come into millions of dollars in a short period of time, more and more athletes are filing for personal bankruptcy as early as five years into their career.

Sixty percent of NBA players are insolvent within five years of concluding their careers and 78 percent of NFL players are either facing financial difficulties or are bankrupt within two years of ending their careers. Though all athletes from all sports can face financial woes, basketball and football players have a disproportionate share of financial difficulties.

Arizona residents struggling with debt from increasing bills may be hesitant to face the stigma associated with filing for either Chapter 7 or Chapter 13 bankruptcy. Such people commonly fear future rejections for financial services such as credit cards or checking accounts.

However, Arizona residents may not be aware that more than 1.4 million Americans filed for bankruptcy in 2011, amid difficult economic conditions. Four out of five bankruptcies were caused by events beyond the control of filers, according to research conducted by Texas A&M University. Medical debt played an important role in bankruptcies, with more than half of them involving debt of more than $5,000.

Even though economic indicators such as employment are improving, the housing market continues to decline. The threat of foreclosure is dragging down new home sales, with figures dropping 1.6 percent in February from an already down January. According to experts on the matter, the housing market slump cannot improve until the rate of foreclosure reduces.

It may be possible that government-sponsored entities embrace the deal. If this is so, many think it could be a tremendous boon to the housing market, not to mention Arizona residents struggling with mortgage payments or other overwhelming debts. But unless or until Right to Rent becomes the norm, some of these homeowners may want to consider filing for bankruptcy or talking with a bankruptcy attorney about debt relief options. A bankruptcy professional can offer advice on how it may be possible for Arizona residents to retain possession of a house and other assets.

While the economy continues to recover, the truth is that it is not bouncing back at the speed at which many need. Many Mesa area homeowners are still facing foreclosure or are paying mortgages that are higher than the actual market value of their homes.

As the value of many Arizona homes has reduced, homeowners are increasingly feeling helpless in the face of their underwater mortgages--when the amount remaining on their mortgage is higher than the value of their home. Although the government has introduced revisions in the Home Affordable Refinancing Program, it leaves most people unprotected as it applies only to federally insured loans.