An increasing number of people in Maryland and across the country are filing for bankruptcy after the age of 55. Since 1991, the numbers have increased dramatically as have bankruptcy filings for those 65 and older. Bankruptcy can provide an important path for debt relief when people are struggling under the weight of unrepayable debt, collector calls and a declining credit score. It can allow people to escape the burden of discharged debt although there can be serious repercussions for people's access to credit.
Being in debt often means receiving calls from creditors who want to collect the money owed to them. For those who don't have the money to pay their bills, this can be frustrating. Fortunately, there are laws that protect the people of Maryland from harassment by debt collectors. It's important for consumers to understand these laws so they can assert their rights.
Lots of Maryland residents struggle with debt. While many realize that bankruptcy is an option, some are reluctant to pursue this for fear that it will cause further damage to their credit scores.
The number of seniors who are filing bankruptcy in Maryland and across the country has been rising starkly in recent years. In most of the cases, the seniors filing for bankruptcy protection made less money than the population at large. Among senior households that filed for bankruptcy during the year 2016, 78% had less than the median annual income. In that year, bankruptcy filings by people 65 years old or older accounted for 12% of the total filings; that figure in 1991 was only 2%.
Student loan debt may be a major factor in some Maryland bankruptcy filings even though those obligations generally cannot be discharged. A study by the company LendEDU found that almost one-third of people who filed for Chapter 7 bankruptcy had outstanding student loans. Almost half of the total debt of that group on average was student loans. This means that even after these consumers file for bankruptcy, they still must pay off a substantial part of their debt load.
A cancer diagnosis could increase the likelihood that a Maryland patient might have to file for bankruptcy. In fact, people who get cancer file for bankruptcy at a rate that is more than twice as high as those without the disease. Even patients who have insurance face out-of-pocket payments as high as $12,000 for a single medication. However, there are ways to mitigate the financial impact.