The current economic situation is putting more and more Americans under pressure. Surveys show that about 10 million Americans are experiencing difficulties meeting their debt monthly payments. Mortgage loans, card debts and auto loans are amongst the commonest personal loans that Americans resort to. Credit card debt assistance has been more demanded by Americans today than it ever was a couple of years ago.

Are you struggling to pay your credit card bills? Have you missed your due date of credit card payment? Well, if you do, don’t worry as there are many helpful ways to deal with this situation. Temporary solutions can be of great help. Many card companies offer their clients a “Payment Holiday” which enables them to postpone payments for a month. On the other hand, it is sometimes useful to contact your card company and request a decrease in your monthly interest rates or even a lower monthly payment. Read more…

The process of getting into debt is simple for most consumers. From credit cards to auto loans, student loans to splurge purchases, a mountain of debt can grow quickly. Unfortunately, getting out of debt can be a daunting challenge for consumers across the country. Depending on your personal financial situation, there is a debt relief strategy that can work for you. From a self-management program to enlisting the services of a debt management professional, these programs can help you gradually eliminate the role of debt on your daily life.

Debt consolidation

A popular choice for many consumers, debt consolidation combines all your debts into a single loan. You will still owe the same amount, but instead of several monthly bills you will have the convenience of only paying one bill a month. Your creditors will be satisfied, and your new lender – your debt consolidator – will consolidate all your debts into one loan. You

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Bad debt can feel like a monkey on your back. It’s always on your mind, and sometimes the stress can be crippling. You may be able to take solace in the fact that you are not alone. There are thousands of people just like you in the United States that are going through the exact problems.

Filing for bankruptcy may seem like the best choice at the present moment. It can help you to get around loan payments. But before you jump the gun, think long and hard. If you end up filing for bankruptcy, this will stay on your credit report for ten years and any attempt to improve credit, obtain a job or residence, or car will be futile.

Something to consider is professional help to take care of your credit card debt. This is important, so do some research. Check the internet, talk to financial agencies and ask for recommendations from others who have gone through the same problems. Read more…

According to the first `Real Retirement` report from insurer Aviva, two fifths (40%) of people approaching retirement aren`t saving any money to help support themselves when they leave work, with many of these `pre-retirees` having considerable levels of debt, the Guardian reports.

The report, which reviews the financial situation of people in three stages – `pre-retirees` (55-64), `retiring` (65-74) and `long-term retired` (over 75), has shown that people in the 55-64 age group are, in general, `much worse off than people who have already reached state pension age`.

As the Guardian puts it, `the report paints a picture of a divided Britain with a growing gap between the super rich and the very poor, with more than one in five people struggling to survive on less than 750 a month and an increasing number entering retirement saddled with debts.`

More than 25% of 55-64-year-olds still have a mortgage, owing 52,535 on it on average, and one in five still owe more than 75,000 on their property. Read more…

The number of Scots being made bankrupt because of unmanageable debts `could yet reach a new high despite a fall in personal insolvencies` in the final quarter of 2009, scotsman.com reports.

Compared with the third three-month period of the year, the number of personal insolvencies in Scotland dropped by around 1.5% in the final three-month period of 2009.

However, as scotsman.com reports, `the situation north of the Border could deteriorate further as restricted access to credit forces more affluent Scots into debt difficulties`.

The fall in Scottish insolvencies has been put down to a 24.9% annual drop in the number of people in debt choosing the `low income, low asset` (LILA) route into bankruptcy. This route, which was introduced in April 2008, makes it easier for borrowers with little in the way of assets to declare themselves bankrupt. Read more…

It’s a common sight to see people pulling out plastic to pay for everything from groceries to gasoline to movie rentals. All it takes is a quick swipe of the card through a little electronic box and a signature. However, the convenience of using credit cards can lead to a false feeling of financial security-at least until the bills arrive.

Robert McKinley of Ram Research says for the first time ever, bank credit card purchases last year totaled more than a trillion dollars. Other statistics are equally staggering — for instance, the average family has a credit card balance of $7,000, and pays out $1,000 a year on interest alone.

If you find yourself overwhelmed with credit card debt, don’t despair. With discipline and a change in spending patterns, you can get out of debt and concentrate your efforts on saving and investing.

“Getting out of debt is easy, but it won’t happen overnight,” says Steve Rhode, President of Debt Counselors of America. “You can’t

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Bank debt recovery varies from other methods of collections, for a combination of different factors. The vast majority of debt to banks are generally secured debts, more specifically mortgages and personal loans which are secured against a property, so in a majority of these situations bank debt collection is usually quite simple. Anytime there are arrears on these loans, it is customary for the debt to be given as quickly as possible or risk losing his or her home and banks will ordinarily enter into agreements for the delinquencies to be paid off over a period of time, because it is always better for the bank to have the financial obligation paid back off steadily than to have to get possession of the property.

Unfortunately for the banks, unsecured debts usually are significantly a good deal more problematical to deal with. Read more…

It is true that Americans with overdue debts will typically be subject to a number of retributions. Collection letters, phone calls, unfavorable credit scores and a chance to wind up in court are examples of punishments for non-compliance.

However, a new trend that is growing is debtors suing debt collectors first. Any violation of the Fair Debt Collection Practices Act can be valid reason alone to take a collector to court. It might be true that in a declining economy suing a debt collection agency instead of paying off what you owe may be your only choice. There were 8,347 consumer lawsuits filed against collection companies in 2009. That’s a 55 percent increase over 2009 and double that number filed in 2007.

Some consumers are plaintiffs suing for the first time, who suddenly find themselves unable to pay debts, and they feel that they have been wronged by aggressive collectors. Read more…

The latest statistics from the Federal Reserve indicate that the total amount of consumer debt outstanding remained fairly steady in 2009.  In case you’re wondering the total amount of consumer debt in the United States stands at nearly $2.5 trillion dollars – and based on the latest Census statistics, that works out to be nearly $8,100 in debt for every man, woman and child that lives here in the US.

And if you’re saying to yourself – that that statistic doesn’t seem quite so bad – just keep this in mind:  We’re talking about consumer credit – which does not include debt secured by real estate.  So if you’re thinking that number has mortgage values in it, it doesn’t.

Consumer Credit Breakdown

So just how does that debt breakdown in terms of credit cards and /or the purchase of a new automobile?  Well, roughly 36% of all consumer debt – as of November 2009 - of this type is what is termed revolving credit, which is defined as credit which is repeatedly available as periodic repayments are made.  The most common type of revolving credit would be credit card debt.

The other 64% of that debt is derived from loans that are not revolving in nature.  This type of debt would include automobile loans, student loans, and loans on boats, trailers or even vacations.  In fact, these statistics also tell us that the average new car loan is over $30,400 and the loan to value ratio is 91%.  That means new car buyers are using down payments of around 9% of the car’s purchase price.

Credit Card Debt

According to information gathered by the US Census bureau, there were approximately 173 million credit card holders in the United States in 2006 and that number is projected to grow to 181 million Americans by 2010.  These same Americans own approximately 1.5 billion cards – an average of nearly nine credit cards issued per credit card holder.

In addition, Americans charged approximately $1,950 billion dollars to their credit cards in 2006 – that’s just over $11,300 in charges per cardholder.  This information includes all credit card types including bank cards, phone cars, as well as credit cards issued by oil companies and retail store.

This data also tells us that Americans carried approximately $886 billion in credit card debt and that number is expected to grow to a projected $1,177 billion by the year 2010.  This works out to over $5,100 in credit card debt per cardholder (not household) and that number is expected to increase to over $6,500 by 2010.

You can find more information on this topic in our article on credit card debt statistics.

Bankruptcy and Consumer Debt

In January 2008, the American Bankers Associated reported the percentage of credit card accounts that were 30 or more days past due dipped slightly to 4.18% in the fourth quarter of 2007.  That’s good news because it means more consumers are paying their bills on time.

But even with this decline in late payments, credit card delinquencies were at the third highest level on record.  To James Chessen, ABA’s chief economist, that can signal financial distress and he attributes this distress to the rise in gasoline prices as well as rising interest rates.

Bankruptcy Filings in 2005 / 2006

Despite the Fed’s feelings about consumer credit, the bankruptcy law changes that were instituted last fall resulted in a rush of indebted consumers to file for bankruptcy in 2005.  That rush pushed personal bankruptcy filings to their highest levels on record – with estimates in excess of 2 million filings.

In fact, according to Lundquist Consulting, a research company based in California, there were 200,732 bankruptcy filings in the second quarter of 2007.  That’s an increase of over 11.6% from the filings recorded in the first quarter of 2007.  On an annualized basis, and using Census statistics on the number of households that mean nearly one in every 35 households in the United States filed for bankruptcy in 2007.

So that leaves it up to you to think about this question – Is the growth of consumer debt really a concern in America?

Source: http://www.money-zine.com/Financial-Planning/Debt-Consolidation/Consumer-Debt-Statistics/

Harassment. Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:

• use threats of violence or harm;
• publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
• use obscene or profane language; or
• repeatedly use the phone to annoy someone.

False statements. Debt collectors may not lie when they are trying to collect a debt.

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