Bankruptcy and the Housing Bubble

The world economy has been experiencing a significant downturn. Although there has been progress toward recovery, especially in a handful of European countries, we are in the worst financial crisis since the Great Depression. Millions of people have lost their jobs, and millions have found their houses worth less than they paid. The combined effect of the economic downturn has left many people with skyrocketing debt.

If that is a familiar story to you, filing for bankruptcy might be a chance for a fresh start. By seeking bankruptcy protection, you may be able to immediately alleviate many of your debts and create a plan to pay off the rest. Filing for bankruptcy can mean losing some of your property or savings, as well as making lifestyle changes. In the long run, however, the benefits far outweigh the likely consequences of struggling with heavy debt for the rest of your life.

The Housing Bubble

A sudden drop in real estate prices in 2008 helped precipitate the financial crisis many of us are struggling with today. Leading up to the bubble bursting, the value of houses had been continually inflated as people rushed to buy new houses. Many people were offered loans for houses they could not afford. When house prices finally fell, the bubble burst. People who had counted on an increase in the value of their house found themselves with a loan for more than the house was worth.

For people who had invested themselves in their houses, especially people who intended on fixing them up and reselling them at a profit, this drop meant losing significant amounts of money. For the banks that had lent mortgages to them and millions of others, the same downturn has been disastrous.

Contact Us

If you are struggling with heavy debt, filing for bankruptcy can help you alleviate your debt and find a fresh start. To discuss your case with an experienced Boston bankruptcy lawyer, contact the Law Office of Joshua Spirn & Associates today at 800-975-5346.