Credit Card Debt Reaches Record High
Struggling with credit card debt is a common reason that Florida residents file for consumer bankruptcy. While credit card debt is not typically the only debt that bankruptcy filers are dealing with when they decide to file for Chapter 7 or Chapter 13 bankruptcy in South Florida, it is frequently one of the reasons, and often the primary reason, that debtors ultimately decide to file for bankruptcy. According to a recent report from CNBC, consumer credit card debt in the United States has hit a new “record” high, and more bankruptcy filings could result from that increased credit card debt. Our West Palm Beach bankruptcy lawyers can say more.
Debtors Are Charging More on Credit and Paying Off Less Debt
As of February 2025, according to the CNBC report, Americans now collectively owe $1.21 trillion in credit card debt, an increase of $45 billion from the most recent quarter. The new figure also represents a debt increase of more than 7 percent from this same time last year. As the amount of credit card debt increases, delinquency rates also remain high — more than 7 percent of credit card balances have “transitioned to delinquency over the last year,” the report says, which suggests debtors are having trouble making credit card payments.
The most recent accounting of American credit card debt is a “record high,” and commentators attribute it to inflation and other post-pandemic factors.
Credit Card Debt is Often Dischargeable in Consumer Bankruptcy Cases
Under the US Bankruptcy Code, it is usually possible for a debtor who files for Chapter 7 or Chapter 13 to have their credit card debt discharged in their bankruptcy case. Credit card debt is not among the exceptions to discharge identified in American bankruptcy law. Oppositely, it is among the most commonly discharged types of debt in personal bankruptcy cases. Accordingly, there is a very good chance that your credit card debt can be discharged if you file for bankruptcy.
There are only certain situations in which credit card debt will not be dischargeable, and these circumstances have to do with credit card debt charged in close proximity to a bankruptcy filing and for amounts that are classified as “luxury” charges. The best way to determine whether or not your credit card debt is likely to be dischargeable is to talk with a bankruptcy lawyer in South Florida.
Contact Our West Palm Beach Bankruptcy Attorneys Today
Whether you are struggling with credit card debt alone or in conjunction with other types of debt, filing for bankruptcy may allow you to get a fresh start. To determine your eligibility for Chapter 7 or Chapter 13 bankruptcy, and to identify debts that are likely to be eligible for discharge, it is important to seek legal advice. An experienced West Palm Beach bankruptcy lawyer at Kelley, Fulton, Kaplan & Eller can speak with you today to learn more about your financial circumstances and to discuss your bankruptcy options with you. When you are ready to file for bankruptcy, our firm is here to assist you from start to finish. Contact us today for assistance.
Sources:
cnbc.com/2025/02/13/credit-card-debt-hits-record-1point21-trillion-new-york-fed-report-finds.html
law.cornell.edu/uscode/text/11
