Emerging Debt Recovery And Collection Trends For The 4th Quarter Of 2023

Emerging Debt Recovery And Collection Trends For The 4th Quarter Of 2023

As we enter the fourth quarter of 2023, the attorneys at Leiden & Leiden recognize certain trends in the areas of debt recovery/collection that will have a profound effect on consumers at the same time that our economy is worsening. These observations are based on cases in which we are actively representing bankruptcy clients, as well as the multitude of free consultations that we provided to prospective clients over the course of the year. As we enter the last three months of 2023, these are the trends that we are witnessing:

1) Debt collection lawsuits are being filed at the highest rate since prior to Covid. Partially attributable to the reduction of the backlog of cases that civil courts faced after Covid, creditors are turning to the courts for collection of their debts. WHY DEBTS GO INTO COLLECTION Some of these cases are being filed because the statute of limitations is set to expire, while other creditors are trying to capitalize on the opportunity to collect their claims against assets and income which consumers may not have had previously. GARNISHMENT

2) Foreclosures FORECLOSURE in Georgia have spiked and are being commenced within three – four months of default, rather than after a year or more of missed payments following Covid. Some of these foreclosures are on loans that had previously been modified and are not eligible for another modification or extension. The increase in property values due to the housing boom makes it more likely that banks and mortgage lenders will recover their full balance from the resale of the property. Many of the properties are purchased at foreclosure sales by investors who are paying cash, so they are not deterred by the increase in interest rates.

3) Subprime auto lending has increased, with the defaults on those auto loans also increasing. The default may be due to missed payments or to the expiration/cancellation of full coverage insurance. THE IMPORTANCE OF AUTOMOBILE INSURANCE Much like the increase in foreclosures, the reduction in automobile inventory means that repossessed vehicles can be sold by the lender at a much better margin than in the past. AUTOMOBILE REPOSSESSION INFORMATION

4) Increases in property values within the CSRA have translated to increases in property taxes and homeowner’s insurance, which means higher mortgage payments for homeowners who pay these expenses through escrow. For homeowners on fixed income, a 10% increase in their mortgage payment can be catastrophic.

5) Student loan payments THE STUDENT LOAN CRISIS are scheduled to begin within the next 2 months, and many consumers that we have met with will not be able to adjust their budgets to accommodate the new expense.

Being served with a lawsuit or a foreclosure can blindside a consumer who is finally getting back on their feet after two years of economic uncertainty. Likewise, a sudden increase in monthly expenses can destabilize what was otherwise a manageable budget. If you realize that your monthly income is insufficient to meet the demands of your expenses and creditors, or if you are facing a lawsuit, judgment, CAN A CREDITOR TAKE MY SOURCES OF INCOME? foreclosure or repossession, please consider calling Leiden and Leiden: P. C. For a free bankruptcy consultation. WHAT TO EXPECT WHEN VISITING A BANKRUPTCY ATTORNEY