Obama’s America In 2014. Wow this is pretty shocking-Lou
Deadbeat Nation: A Shocking 77 Million Americans Face Debt Collectors
We have been warning for years that as a result of the Fed’s disastrous policies, America’s middle class is being disintegrated and US adults are surviving only thanks to insurmountable debtloads. But not even we had an appreciation of how serious the problem truly was. We now know, and it is a shocker: according to new research by the Urban Institute, about 77 million Americans have a debt in collections.
The breakdown by region:
As the Washington Post reports, that amounts to 35 percent of consumers with credit files or data reported to a major credit bureau, according to the study released Tuesday by the Urban Institute and Encore Capital Group’s Consumer Credit Research Institute. “It’s a stunning number,” said Caroline Ratcliffe, senior fellow at the Urban Institute and author of the report. “And it threads through nearly all communities.”
The report analyzed 2013 credit data from TransUnion to calculate how many Americans were falling behind on their bills. It looked at how many people had non-mortgage bills, such as credit card bills, child support payments and medical bills, that are so past due that the account has since been closed and placed in collections.
Researchers relied on a random sample of 7 million people with data reported to the credit bureaus in 2013 to estimate what share of the 220 million Americans with credit files have debts in collection. About 22 million low-income adults who did not have credit files were not represented in the study.
While we understand why someone owing tens if not hundreds of thousands can just do what the US government does so well, and simply decide to stop paying their debt (if unlike the government, without the option to roll it), what is scary is that there are people who are in collection on amount as tiny as $25.
The debts sent to collections ranged from $25 on the low end and to more than $125,000 on the high end. Many consumers were burned for relatively small amounts — about 10 percent of the debts were smaller than $125, Ratcliffe says. But the median debt, $1,350, is still pretty substantial, she adds.
The geographic breakdown is not surprising, headed by the state that hosts Las Vegas, where an unprecedented 47% of all consumers have debt in some stage of collection.
Nevada was hit the hardest, with 47 percent of consumers with a credit file showing a debt in collections — a mark researchers said may stem from the housing crisis when people struggling to keep up with their mortgage payments may have fallen behind on other financial obligations.
It’s not just Nevada. It’s, well, everywhere else too:
In 12 states, including the District of Columbia, more than 40 percent of residents with a credit file have a bill in collections. That includes Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, New Mexico, North Carolina, South Carolina, Texas, and West Virginia.