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Eugene OR Bankruptcy Law Blog

Stress: The link between debt and poor health

Regardless of the amount of income, debt can be a major problem for those who live in Oregon. The increasingly higher costs of housing and difficulties paying off medical bills and credit card debt are overwhelming for many people. According to the American Psychological Association, annual polls consistently reveal that more than half of Americans are stressed out over money. The problem may be worse for younger adults, and for those who have children under 18 years old.

In a recent survey, people reported being more worried about money than they were about their health, but ironically, the financial stress could cause a number of serious health issues. The APA notes that the longer people suffer from stress, the more likely the condition is to become chronic. As time goes on, physical problems develop or worsen in response to the constant strain.

Death doesn’t always erase credit card debt

After a death in Oregon, a spouse or other family member may discover that the deceased had a considerable amount of credit card debt. This could be uncovered as the executor or administrator of the estate gathers the information on assets and debts, or it may be that creditors begin to call and request or demand payment. In some cases, these calls are not legal, but a family member needs to make sure that he or she is not on the hook for the accounts. explains that unsecured debt is not typically inherited as assets are. However, anyone who co-signs on a credit card application is a joint holder, and the debt belongs solely to that person after the death, even though he or she may not have had any part in the accumulation of the debt. Having the ability to charge purchases to the card does not make a person a joint cardholder. Authorized users are not responsible for the debt, even though their names are on the account.

What does chapter 7 bankruptcy mean for entrepreneurs?

If you own a struggling business in Oregon, you may associate bankruptcy with the end of the line for your entrepreneurial spirit. However, sometimes getting out from under impossible financial circumstances through a chapter 7 bankruptcy may free you to go on to better things. According to Nerd Wallet, that approach has worked for more than one small business owner who fell victim to situations beyond their control.

The key to your success after bankruptcy will depend on your personal goals and other factors, but for one entrepreneur, the answer was to create a tight budget and get a secured credit card. She pursued a new line of business that capitalized on her experience and expertise without requiring her to locate extensive start-up capital. Meanwhile, she made regular payments on the credit account until she qualified for an auto loan, and then eventually, an unsecured credit card. By the time the bankruptcy came off her credit report, her good credit score had been reestablished, as had her position in the business world.

Don’t overpay on your medical expenses

Whether you have health insurance or not, you can easily end up with a hefty bill after you receive emergency care, have routine tests run or undergo a procedure in Oregon. If your first reaction to seeing the total is disbelief, this is a good sign that you should investigate further. Our team at The Law Office of Kim Covington is aware of the many ways that health care expenses may be inaccurate, and how people can seek to reduce or eliminate medical debt that they cannot afford.

The total is not actually the number you should focus on when you open your medical statement, according to Nerd Wallet. Instead, take a look at the itemized portion. This is where you should find information such as what medication you were given and the cost, as well as what items or devices may have been used. The billing department could easily type in the wrong number and charge you for 20 Tylenol instead of two, for example. You should also look for any fees that may be duplication errors.

Possible challenges to garnished wages

In Oregon, wage garnishment, or having a piece of one’s paycheck given directly to a creditor, has several iterations. Private creditors (credit card collectors, unpaid landlords, etc.) require a court judgment against the debtor to garnish wages, while other garnishment can happen without going to court. Unpaid child support, income taxes and student loans do not require a judgment to be garnished.

According to, employers must comply with legal requests for garnishment within 90 days of receipt. Otherwise, the employer will be held liable for the amount meant to be withheld. In addition, employers are able to charge for this--$2 for each paycheck that requires pay to be withheld. All of this can put someone who was already feeling financial constraints into dire straits, so it is important to find an experienced lawyer to make sure no more money is being withheld than is legal.

How do you find a good pre-bankruptcy credit counseling course?

Once you have determined that you cannot get out from under your mountain of debt by making monthly payments, you may be looking forward to the relief of bankruptcy to restore your financial equilibrium. Chapter 7 bankruptcy in Oregon is a process, though, and one of the first steps you must take, before you file, is the completion of a credit counseling course.

According to the U.S. Federal Trade Commission, any organization that wants to provide this credit counseling program must be approved. All of those that you may choose are listed online through the U.S. Department of Justice, or you can view the list by checking with your district’s bankruptcy clerk’s office. Inclusion on the list is not the only factor you should consider, though.

Driving an upside-down car

Transportation in Oregon is a necessity, but if you had to buy your car with less than optimal financing, even if you have been making your payments on time, you could find yourself in serious trouble. Sometimes, in order to get a customer into a new car, the dealership’s finance department may offer a loan that extends over several years, and after three or four years of payments, this has the potential to leave you owing much more than the vehicle is worth. At The Law Office of Kim Covington, our team frequently assists people who want to know what their options are for dealing with a negative equity vehicle loan.

According to, your alternatives in this situation depend on whether you want to keep your car or not. For example, if it has a problem that makes it unreliable, you may be in a position where you have to get a new one, even though you still owe money. In this case, a car dealership may suggest rolling the balance of the loan into a loan on a new car. If you want to keep the vehicle, though, you may want to consider refinancing it.

Who qualifies for a Chapter 13 bankruptcy?

When you are not interested in liquidating your assets, but your income does not cover your expenses, it may make sense for you to look at your legal options to get you out from under the financial strain. According to the Oregon State Bar, you may be eligible to file a Chapter 13 bankruptcy if you meet certain qualifications.

As the sole proprietor of a business, you may file for debt reorganization. However, you will not qualify if you have a different type of business, such as a C or S Corporation, or a partnership. If a business is not involved, you and your spouse may file as a couple, or you may file individually.

Americans take on more credit card debt

From the loss of a job to medical problems that were never expected, people experience financial hardships for all sorts of different reasons. Sometimes, people in Eugene and across Oregon decide to take on credit card debt. However, this can be a costly decision and some struggle with paying off credit cards later on.

According to a recent report, Americans have recently taken on a considerable amount of credit card debt. The debt, which exceeded $1 trillion at the close of 2016, reflects the greatest level of credit card debt across the country in the years following the recession. In recent years, some Americans have turned to credit cards due to struggling with increasingly costly living expenses.

Adoption agency files for Chapter 7

From unanticipated medical problems to declining sales, businesses may find it necessary to file for bankruptcy for many reasons. In Eugene, and other cities across the state of Oregon, deciding to file for bankruptcy can be an incredibly difficult decision. However, it can help businesses recover from the financial stressors they are facing and restore a sense of normalcy. For those considering filing for bankruptcy, different options may be on the table. Sometimes, Chapter 7 is the most effective course of action.

An adoption agency based in California recently filed for Chapter 7 bankruptcy. The agency, which had been conducting business in Georgia, reportedly had assets totaling $57,000. According to reports, the adoption agency had $6.5 million worth of assets in 2014.

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The Law Office of Kim Covington

Eugene Office
1445 Willamette Street, Suite 9
Eugene, OR 97401

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Albany Office
1135 Dale Street SE, Suite #B
Albany, OR 97321

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1701 West Harvard, Suite 201
Roseburg, OR 97470

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Phone: 541-393-2790
Toll Free: 800-673-1891
Fax: 541-344-6466
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