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Saturday, 14 September 2019

In America, debt-ridden citizens, debt to consumers reached $ 4 billion

Debt on US consumers has risen to new record highs. That means $ 4 billion is the highest in US history to date.
The average adult American only has a credit card of about $ 4,000 or about $ 3 million in debt.
Poor families are having difficulty making a living due to debt. They have no means of paying off debt.
"This is like a valley of death," says Dean Ledbetter, an army officer.
The debt has ruined his health and made himself bankrupt, the military official said.
He started using a credit card, but then realized he could not pay it.
So he started taking more loans from the lenders (with higher interest rates). I also had to borrow from friends.
Ledbetter says, "I participated in the Gulf War. My back was injured and my eyesight was also somewhat lost."
After returning from the war, he was living on a pension.
After the marriage collapsed, he had to leave the house and stay in the car on the road. There was very little to eat.
Due to this, the debt gradually increased on them. They say, "I have to live somehow."
They now have a debt of more than $ 100,000 total.
It is not possible for a person like him to live on a normal pension.
Dean Ledbetter says, "Your ship is like a wreck. I had to decide whether to float or sink. As interest grows."
"This is a very abusive situation. I am honorably living. I am sick of saying I can't pay off debt."
There are many people like Ledbetter, who demand that there should be some sort of control over the interest rates that financial institutions charge.
Loans of any type are considered valid in 32 US states other than traditional banking.
Usually, such a loan is very expensive. Because of this, people are caught in the cycle of interest.
There are three types of loans in which most borrower gets stuck - consumer loans, vehicle loans and student loans.

"The whole idea is wrong"

Lenders Alliance Online Executive Director Mary Jackson defends the terms with which lending is likely to be submerged.
"The default rate is 25%. The burden is on the industry because people are not in a position to pay their debts."
How can such a high interest rate be justified?
"A 15% interest is charged on the loan taken for two weeks."
"The loan has not been taken for a year, so calculating that 300% interest is paid is wrong," says Jackson.
But there are companies that charge up to 80% per cent for two weeks on the same client who has already taken out a loan.
Due to this the interest on the debtor interest is paid off.
"That might be true in some cases," says Jackson, but most states have banned another lawn from completing one lawn.

Rural poverty in the world's richest economy

If we think of the whole nation as a lot of people, if they do not pay their debt, it can be a big problem.
A similar situation was created during the Great Depression of 2008. At that time many families could not afford to pay their mortgage.
Many economists are saying, "Debt on consumers does not seem to be a threat to the country's economy right now."
"When interest rates are historically low, such risk is minimal."
But some experts, such as Kenneth Rogoff, a professor at Harvard University, believe that "constant stagnation (due to economic stagnation and rising inflation) creates a bad situation for low-income people."
"I think in some parts of the country, especially away from urban areas, there is a situation where there is less work available and the cost of housing has dropped."
"Some regions are in more danger and consumer loans have become a problem there."
"The rate of migration is lower now than it was 30 to 40 years ago."

Debt crisis on students

In which sectors is debt rising the fastest?
"Consumer loans, vehicle loans, and most dramatically, student loan loans are increasing debt," says Ms Rogoff.
"Students are still looking for employment, so their debt is most affected."
He explains that 15 years ago, the law was amended to put students in 'unfair' status.
Melissa Hagetree, 24, says, "Despite having a well-paying job in the middle class, he couldn't pay his lawn. He gets about 11% interest annually."
"When you have debt in your head, it becomes difficult to imagine what the future will hold."
"I don't understand if I can repay the loan. It has been difficult to move beyond one month's calculations."
"My salary is good, but the bank is asking me to pay more than I earn."

In some cases, the interest rate rises and increases

Martha Wonderley is a representative of the Fair Credit Foundation, a nonprofit organization that helps borrowers in Utah.
He says, "An average person has to use more than half his salary behind a house. People's salaries do not rise as the economy continues to grow."
"True, unemployment is low, but people are not earning enough to cover their expenses."
Wonderley explains that once people get into a clutter of interest, they can't get out.
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