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Business/Finance See other Business/Finance Articles Title: Debt Is Forever in 21st Century America Debt Is Forever in 21st Century America Thursday, 11 Dec 2014 07:40 AM By John Morgan Nearly one in five Americans expect to be in debt the rest of their lives and never pay off what they owe, according to a new http://CreditCards.com survey. Specifically, 18 percent of the 1,001 respondents don't believe they will ever get out of debt – double the percentage who said that less than two years ago, in May 2013. While mortgage delinquencies have declined recently, credit card debt is going back up and student loan debt has been on the rise in recent years, CNBC reported. "We've all seen the student loan debt numbers, and credit card debt is increasing, and even though the job market is improving it's certainly not humming along, and there is data about people's salaries not growing quite as quickly as people had hoped," Matt Schulz, senior analyst at http://CreditCards.com, told CNBC. "You just wonder if it has all come together to create this unease." Older respondents were more apt to believe their debt would never get paid off. Approximately 31 percent of those older than 65 expected to be lifelong debtors, versus 22 percent of those aged 50 to 64 and just 6 percent of millennials aged 18 to 29. In a separate study, http://CardHub.com found that credit card spending in the U.S. rose by $15.94 billion during the third quarter of 2014. "The bad news is that while economic gains are making consumer spending habits sustainable for now, our attitudes toward debt have not improved since the Great Recession," wrote Odysseas Papadimitriou, CardHub CEO and the report's author. The $15.94 billion added in third quarter represented a 35 percent increase over the third quarter of 2013 and a 25 percent rise relative to the same quarter of 2012. "The consumer debt picture has now worsened on a year-over-year basis for four straight quarters," Papadimitriou wrote. "CardHub now projects that U.S. consumers will end the year having racked up more than $60 billion in new credit card debt, which would be at least 55 percent more than in 2013." In what could be another echo of the 2008 financial meltdown, The Washington Post reported that mortgage giants Fannie Mae and Freddie Mac would soon permit mortgages with down payments as low as 3 percent for some borrowers. The Post said critics have blasted the move as a return to the lax lending standards that contributed to the 2008 financial crisis, and the huge taxpayer bailouts of quasi-public Fannie and Freddie. "The companies and their regulator insist that they are in no way encouraging a return to the shoddy lending of the past. They say only creditworthy borrowers who take out plain-vanilla, fixed-rate mortgages will qualify for the new programs, and all of them will be carefully vetted to make sure they can pay back the loans," The Post noted. However, Investor's Business Daily reported the federal government's Consumer Financial Protection Bureau (CFPB) has specifically warned mortgage lenders not to verify the income of people receiving Social Security Disability Insurance benefits. The CFPB decree tells mortgage lenders they could face "disparate impact" liability if they question whether "all or part" of a minority applicant's income "derives from a public assistance program," IBD said. "More, the Justice Department has ordered the biggest mortgage lenders in the country, including Wells Fargo and Bank of America, to offer loans to people on 'public assistance.' They're even required to post branch notices promoting the risky welfare acceptance policy. "The administration is actually forcing banks to target high-risk borrowers for 30-year debt under threat of prosecution," IBD concluded. Read Latest Breaking News from http://Newsmax.com www.Newsmax.com/Finance/d.../id/612260/#ixzz3Ld8mlv55 Poster Comment: The money of kings is gold, the money of gentlemen is silver, the money of citizens id barter, the money of slaves is DEBT! Post Comment Private Reply Ignore Thread Top • Page Up • Full Thread • Page Down • Bottom/Latest Begin Trace Mode for Comment # 2.
#1. To: BTP Holdings (#0)
That is why interest rates for certain types of debt are high. Rightfully, the creditors make up for unpaid debts by collecting more interest.
Really? I had a loan from a pay day loan outfit. I was told that they wrote it off when they found out I could not repay it. So, what's your point? ;)
#3. To: BTP Holdings (#2)
The point is that lenders lend to make a profit. Therefore, when the risk of not getting their money back is high, they insist on a higher interest rate. That is, low risk = low interest. High risk = high interest. People like you that don't or cannot repay their debts find it increasingly more difficult to get loans. And, even if you do, the interest rate is high.
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