America’s next big thing: Debt

April 2nd, 2009 - 3:56 pm ICT by David M N James  

As it is, America’s economy is on a free fall. Many people are in debt, the entire economy is shuddering. The mortgage crisis and mounting job losses melt away the American dream bringing a new dawn. One that projects that America is facing a time of reckoning. The mortgage problem has become a thorn in the flesh. Foreclosures have taken a toll and people are regretting why the deal was so good and they never thought twice.

According to Elizabeth Warren, an expert who is overseeing government’s 700billion bailout plan for banks, say that, It’s not only the next crisis, it’s the now crisis. None of these things are separated from each other. We are in debt crisis, not just mortgage crisis.

Before the housing bubble burst, many Americans were able to take loans against the value of their houses to stay afloat, using that cash to pay off credit cards and other debts. However, with home values plummeting, and unemployment rising, millions now have nowhere to turn. Moreover, American consumers are now carrying an unprecedented, staggering amount of debt: $2.5 trillion. This is per her projection during an interview with broadcaster NBC during the dateline hour.

Americans have been engulfed in debt, skeptically, for lack of providence. However, they cannot be blamed since the circumstance surrounding the escalation of problems including expensive health provisions have seen them have piled up debts amounting to hundreds of thousands of dollars. Credit cards have been a major cause of discomfort making those who have used them as the only way out of their problems to find themselves in the centre of financial ruin and immense debt. Homes have cable shut off, gas line and electricity cut and telephones disconnected. Everything is perilous.

Lay offs as companies seek cutthroat measures to cut on spending and save enough to realize a profit is becoming an issue. Those laid off are finding themselves struggling everyday hence going for credit cards and getting debts as a prime prize and a way toward misery. People are finding themselves jobless and out of commission and life is becoming a quagmire. Americans current crisis is debt and increasing joblessness. According to experts, Americans are now piling debt not wealth. They are living beyond their means and that is the truly profound. Debt is reaching a sublime high and soon, it will take toll.

Credit cards are becoming a lifeline. Those who are laid off are trying to adjust and the only resolve is the credit card. According to Dateline, the credit card companies have managed to throw loan sharks out of business. Everyone wants the credit card. Loan sharks are being knocked out of commission. People want to get debts and pile them up until they get a foothold on their abilities once again.

Victims of this ongoing problem are talking of humiliating and embarrassing moments. Debt collectors, cut offs and impromptu appearances by lenders. One complained that he was getting over ten calls a day from the lender. It is a problem that is going beyond the expectation of many. Some have come up with debt repayment plan, but the lenders are refusing. They want a quick way out and possessing what seems like a good collateral is the only resolve they find amicable.

Apart from the problem of the debt collection, the debt collection is coming with abuse. Some debt collectors are becoming increasing abusive. One left a note to a victim asking her if she has ever been raped. It is astonishing. People are being shocked at how the system and a wayward debt collection sector. The victims have sued the debt collectors. According to a report from Dateline NBC, Rozanne Andersen, the lead attorney for ACA International, the nation’s largest debt collection industry trade group. That is insane. That– that is ludicrous. That has nothing to do with debt collection. If any one of our members– actually had to face me and say, “Oh, sure, we do that all the time,” I would be shocked, and I probably would not be sitting here representing the industry.

The worst scenario ever is that, people are not developing cold feet, but are opting to plunge deeper into the debt problem. They are going for the credit cards and relentlessly making their lives easy as thy pile up debt. That means, more debtor collectors will be knocking at their doors sooner than later and the abuse and many heart breaks will keep on assailing as the recession comes toits prime stage and leave millions either homeless or jobless.

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