Are Homes the Cause of Some Bankruptcies?

According to an article in the Toronto Star, homes are becoming more of a problem for consumers with escalalting debt.

In the past it was unusual for the family home or real estate to be the cause of bankruptcy in the last 10 to 15 years. It actually was a solution for many people. However, with the drop in the value of homes, their equity has disappeared and they come up with a deficit that the bank still wants repaid.

A bankruptcy trustee with Deloitte & Touche attributes the recent spike in consumer insolvencies to a seven-year high unemployment rate and people relying too much on credit as an income supplement. People worried about losing their job should be cutting expenses and aggressivley repaying debt. Always sound financial advice!

Warmly,
Mary Wozny