Delinquent Credit Card Debt, by Roy Mason
If there is $15+ billion in delinquent debt, that constitutes a lot of debt. If the population is 323.95 million as of 2016 (according to Cortana).
Its ironic. I read an article from Justice News and the Department of Justice dated Thursday, August 21, 2014, that states that Bank of America had to pay $16.65 Billion in Historic Justice Department Settlement for Financial Fraud leading up to and during the Financial Crisis. The article stated that this was the largest such settlement on record.
The article stated that $7 Billion was to go to struggling homeowners, borrowers, and communities affected by the bank’s conduct.
The article stated that “This settlement is part of the ongoing efforts of President Obama’s Financial Fraud Enforcement Task Force and its Residential Mortgage-Backed Securities (RMBS) Working Group, which has recovered $36.65 Billion to date for American consumers and investors.
I realize that most of this money probably went to the lawyers and government entities that fought for it. I cannot prove this, nor have I been able to determine exactly where every dollar (of this $36.65B) went. But I wonder why it could not go back to the hard working people in serious debt who are losing their homes or in trouble due to debt. The article said some went to borrowers, but somehow, I doubt that it did. After all, the wealth of these major banks is generated from the home and loan investments of everyday people, much more than corporate loans.
Why is it that the government is so willing to bail out big banks and there is little incentive to bail out average people?
Debt devastates families. College debt is a huge contributor. It is something that haunts my decisions about college, and I haven’t even started yet. My uncle is a psychologist. He has obtained his doctorate degree but he also has $200K in college debt. Unfortunately that is his own, but not all he is accountable for. His wife also has debt, and so do his two kids. One is still in medical school. I read somewhere that the average person graduating from college graduates with an average debt of $37K. I fear contributing to that statistic.
I believe people should keep their word. A commitment to pay a debt is just that – your word. That word should be honored. However; in this day and age, bankruptcy is such common practice, it seems as if it is now the norm. So I am a bit conflicted.
Millions of Americans find themselves in delinquent debt, and the process of digging out becomes more and more difficult due to high interest rates, life-compounding events, and poor financial management. My family plays a game called Cash-flow. It shows you how to get rid of debt. It is a game that children and adults can play. I think that its greatest benefit is the concept that you do not have to be in debt, and should actually strive to get rid of it as soon as possible in order to maximize your cash flow.
My recommendation is that rather than committing to the banks who perpetuate debt, commit to the pursuit of freedom amongst former debtors. With a little bit of the monies paid out by the afore mentioned banks paying
back, the government (or a nonprofit entity) should establish a loan fund for customers to get out of debt. The alumni of this debt must contribute dues in order to “give back”. Its simple. You begin with a portion of monies acquired by banks. A government entity exists solely for the purpose of debt relief. They provide financial relief to those in debt via low interest loans. Interests serve to generate funds for debtors rather than banks and government.
The consequence for nonpayment is a back door extension of the loan. In other words, the loan is extended.
Here is the huge benefit to debtors. They are released from heavy debt and allowed to escape delinquent debt, allowing a freedom of decisions, income, and future. They are no longer limited to the high interest loans like those who remain in that cycle.
Rather than loans, the same entity can provide grants to those in debt. The same concept would apply. A mentality to give back once you’ve been assisted and to see others out of debt is the way to create an environment of perpetual escaping debt.
Since credit card debt is also a huge portion of delinquency debt. Another option is to create a credit card specifically for the same purpose; to allow for an escape from indebtedness.