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Mortgage debt plagues many, but debt relief may be available

Tennessee residents may be surprised to hear that according to one report, as of May 2016, the amount of consumer debt owed nationwide totaled $3.4 trillion. On average, American households with debt have approximately $16,000 of it. This is a 10 percent increase from the amount of debt owed in 2012.

A GoBankingRate survey reported that of debtors surveyed, about one in five reported that a mortgage loan debt was their largest debt. On average, these households carried mortgage debt in the amount of $59,500. Individuals between the ages of 35 and 44 were the most apt to have this type of debt, as were high-income individuals. Individuals age 65 were the least apt to have this type of debt.

Debtors who carry a large amount of mortgage debt may have options for coping with such debt. They may be able to refinance their home, which can allow them to take advantage of lower interest rates. Another option might be to shorten the length of the mortgage. Mortgages of a shorter duration rack up less in interest, which could help debtors in the long-run. Renting out rooms is another idea to up the amount of one's monthly income, or downsizing to a smaller home could make mortgage payments more affordable.

If none of these measures are feasible, and an individual finds that he or she is struggling to pay his or her mortgage and other debts, that individual may want to consider filing for bankruptcy. If a person is receiving harassing telephone calls from lenders, is having bills sent to collections or is facing the threat of repossession of his or her property, bankruptcy can put a halt to these actions. Whether a person files for Chapter 7 bankruptcy or Chapter 13 bankruptcy depends on his or her personal financial situation. An attorney may be able to help a person determine what debt relief options are available.

Source: The Motley Fool, "This Is the Most Burdensome Type of Debt New Study Shows," Sean Williams, Oct. 22, 2016

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