Understanding and managing debt is often the first step towards discharging it. Arizona residents struggling with debt may not know which debt to pay off first or how repayment plans can help them. Increasingly, financial educational seminars are being given by the organizations least expected to, credit unions.
Credit unions thrive on loans, so it seems ironic that they are educating people about how to manage their debt and repay loans. However, a senior representative from a well-known credit union explained that they want to grow with their members, not at their expense. A well informed consumer is one who understands their financial obligations and is able to meet them. Their seminars on handling debt and paying off loans are one way to ensure consumers get this information. In fact, according to one representative, they attempt to ensure borrowers do not get in over their heads when they borrow money.
Those Arizona residents who do in fact get in over their head and need assistance in meeting their financial obligations may face wage garnishment in an already financially strained time. They may not be aware that they can avail the federal and state protections at their service, such as filing for bankruptcy. Based on their income, they can qualify for either Chapter 7 or 13 bankruptcy. In either case, wage garnishment and creditor harassment are put to an end, and it may also be possible to get an automatic stay on foreclosure proceedings.
Financial education is important to understand debt. It should also include awareness about last resort options that may in fact turn out to be the best way to discharge most debts and taxes, and allow the filer an opportunity to restart their financial life.
Source: Credit Union Times, "Balancing growing loans, shrinking debt," Michelle Samaad, Mar. 30, 2014