Consumer Credit Card Debt Is the Next Economic Shoe to Drop in Financial Crisis

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Lucky you John of De!
Maybe things are better in Deleware, but they aren't here. I too paid my house down, and though it's dropped from $250k to $160k I still have equity...BUT....
No job, no chance of a job--there are no jobs in my county. Oh, "get some skills" you might say? Try BS Chemistry/BS Safety/ADN (Registered Nurse...and btw contrary to what you hear nurses countrywide have about a 9% unemployment rate). Add this: Tool & Die Maker, Machinist, Plumber, Cabinet Maker...shall I go on. What part about "NO Jobs available" do you not get? Just because you live in an area where you still have your job does not mean people do not take responsibility.
Well, at least if Obama's job thing goes through I can be a highly educated Flagman, eh?
Equity in a house with no income, multiple degrees, multiple skills, ok John of De, I paid my school loan off, paid much of my house off and meet you "Bottom line, you are responsible for understanding your personal finances, and it is up to you to not get in over your head."
But I am in over my head regardless, and so may you be next year and then with no income, eventually you will still lose your house and frankly with your insensitivity, it may just serve you right.

John of RI 6:00PM September 14, 2011

I was late on a payment by 2 days and my interst rate shot up from 16% to 30%. After BOA took millions in taxpyer money, they can get bent...i am not paying it. I live in Texas where we are protected from wage garnishment, so I have nothing to loose. My credit is already screwed because of these practices, so why should I care if BOA has to eat it....I don't, not anymore. They had better get used to it, I am not alone.

DP of TX 2:49PM January 06, 2010

Condemning debt straddled consumers for not practicing 'personal responsibility' is laughable, especially when coming from the mouth-pieces of banks. Why is it that banks can expect trillions in 'backstops' and outright bailouts for their financial incompetence, and then turn around and act morally outraged by the behavior of consumers?

Josh of IL 11:35AM April 20, 2009

On April 2, 2009 on NPR's "Talk of the Nation" a Leading Economist stated "It is essential that the Ant Bankruptcy Law of 2005 be repealed and that Congress have this Very High on its Agenda"
Predatory Lending and now "Predatory Collections" Including Law Suits , wage Garnishments , Checking account Seizures have thousands of Americans both squeezed and trapped. Many Americans whom have defaulted on credit Cards have found their Debts Sold to Debt Collection Companies and they can no longer even negotiate with the Credit Card Companies. They cannot qualify for Chapter 7 because they have a Job which exceeds the Means Test. Yet in Chapter 13 , they calculate everything on Gross income and it makes it seem they have between $1000 to $2500 to pay the Trustee. Add to that your Mortgage payment has to be payed to the Trustee as well. The Trustee will take a percentage of this Enormous Monthly payment making your payment possibly $4500 per month! For 5 Years you are their Slave!!!
You live just above the Poverty Line. Who can endure this?
The only options many Americans have left is to let their Homes Foreclose and move to cheaper Housing to have the extra income to fight off or settle with Collectors. Consumer Credit Counseling and Debt Consolidation companies have equaly high payments and don't Guarantee you won't get Sued anyway.
President Obama ... You promised to Overturn The Anti Bankruptcy Law which you called "A Gift to the Credit Card Companies" Did You Forget??? Time is of the essence.

Jay of FL 9:35PM April 05, 2009

What happened to the term "Personal Responsibility?" Why is it that everything that happens to us is the fault of someone else? I am 52 years old and debt free except for my house. I bought the house at the peak of the housing bubble in 2006. The house is now worth about 16% less than it was in 2006. However since I put down 32% I am still above water and still have a nice equity. I could certainly lose my job but chances are that I would be able to keep my head above water until I found something new.
The way I did this was to now buy more than I could afford, and I stopped using credit cards about 10 years ago. I paid off mine and my childrens student loans as quickly as possible instead of dragging them out for dozens of years.
Bottom line, you are responsible for understanding your personal finances, and it is up to you to not get in over your head. It is nobody else's responsiblity to make sure you don't do something stupid.
If you haven't already figured it out, nobody is going to look after you but yourself, and if your lucky, your partner.

John of DE 3:06PM March 23, 2009

I wnat to add my voice to those below. I owe $98,000 on a $27,500 student loan. I am 58 years old and despiar of ever paying it, even though I have essentially paid the principal!! My interest rate is fixed at 9% and cannot,according to the lnder, ever be lowered. It is time to restore standard comsumer protections to student loans. For those in a similar situation, check out studentloanjustice.org. If enough of our voices are heard, reforms may happen.

Kay Oliver of CT 4:44PM March 17, 2009

hello, mr. blakeman, rush limbaugh is not just a mere entertainer. how dare you go on the dnctv 's shyster's show and say such a thing. no wonder w has such low ratings if were advising him

andy t. of FL 1:28PM March 17, 2009

That is true, not only did the housing market and credit card debts become a huge problem in this country, but the student loans as well.
I have credit cards with 27% interest and My student loans (which I have been paying on) are going to cost me over $200,000 when I pay them off at 56 years old (if I make every payment on time) and that is for $45,000 worth of borrowed money.
I dont even own a car because the dealerships I went to laughed at me and said with my student loan debt I will never own a house or a car... this is happening to people all over the country and I am sure that maintaining student loan payments that are more then half my monthly income cant be helping the economy since that money cant be used on a house, a car, a tv or even food some months.
It is easy to say "just get a second job" but in this economy and with the unemployment rates I am lucky to even have a first job. People with just credit card/house debt can file bankrupsy, it might not be easy right now, but it can be done. People with student loans are more the victim in this country then anyone with another kind of debt. Student loans can not be discharged. Some companies wont even work with students to get the debt on track, they would rather it default so the money can come out of bank accounts, social security or directly from pay.

Rachele of CT 8:26AM March 17, 2009

Speaking of greedy and predatory lending practices, let's take a closer look at the student loan industry. Student loans are the only form of consumer debt lacking standard consumer protections. In 1997, student loan companies such as Sallie Mae successfully lobbied Congress to amend the Higher Education Act and remove consumer protections, making defaulted student loans among the most lucrative and easy debts to collect.
The loan companies actually have a vested interest in debtors defaulting on their loans and have great leeway to collect on those loans.
Harvard Professor Elizabeth Warren was quoted in a Wall Street Journal article as saying that “student loan debt collectors have power that would make a mobster envious.”
The student loan companies can garnish or seize Social Security and disability payments, and even raid personal bank accounts without a court order. A number of people have actually been driven to suicide by their collection tactics. Others have fled the country, rather than become destitute and homeless in the United States.
Since I have dual citizenship, American and Irish, I could choose that option as well, but I see no reason why I should have to live in exile. Over the last 7 1/2 years I've paid $106,000 on the original loan amount of $60,000, and I still owe over $98,000 to Sallie Mae. There is no legitimate public interest served by creating a caste of lifelong indentured servants.
The only people benefiting from this situation are the CEOs and corporate officers of companies like Sallie Mae. The outrageous profits they make would be better off circulating in local economies. Reform is badly needed.

Brian Galloway of WA 5:57PM March 16, 2009