Most Tennessee consumers have credit cards, and many people use them for daily purchases, including groceries, clothes and much more. For many, their credit card is their option for emergency funding in case of an unexpected situation, such as an injury or other types of expenses they cannot pay for. Because of these reasons and many others, the amount of bad credit card debt in the United States is on the rise.
There are several concerning signs that could indicate a looming financial crisis. First, the rate of charge-off debt, which is the amount that companies have no expectation of ever collecting, has risen by a few percentage points since the beginning of 2019. The amount of balances past due by at least 30 days also increased.
Another indicator that credit card debt is entering dangerous territory is that more consumers are seeing a degradation of the quality of their credit. This could lead to an inaccurate picture of the true financial health of a consumer, and this could lead to some card holders to have credit limits beyond their means. It could result in the inability to pay and, eventually, significantly past-due balances.
There are many reasons to believe that credit card debt has reached unhealthy levels in Tennessee and across the country. When a consumer is unable to pay his or her balances, it may be beneficial to consider moving forward with a bankruptcy filing. This process offers financially overwhelmed the consumers the opportunity to deal with certain types of debt and secure a better future for themselves and their families.