Foreclosure of houses includes ‘default notices, auction sale notices and bank repossession’. This means buyers failed to make payments due to losing jobs, being disabled or other life changing events such as death and divorces – both of which are range high on the list of stress. I feel sorry for these kinds of people who have to deal with the collection agencies.
I could be one of these people who will go into collection. Once in collection, we are no longer consumers but slaves. So far I am able to keep up with the minimum payments of my open balance on my credit cards and while jobless for two months. I could have paid off the balances had the credit card companies stop the practice of usury by charging interest rates as high as twenty-five percent (25%)!
After reading the fine print of disclosure by credit card companies, I find that my payments are not being applied to the principal balance because the minimum payment barely covers the finance charges only. After missing one month’s payment, the minimum balance to be paid each month is THREE times higher and is almost half of a paycheck!
I could file for bankruptcy and never get credit (or buy a house) for ten (10) years if I fail to make payments. Bankruptcy is also another way to lead the poor into the jailhouse because the prevailing laws make payment on bankruptcy harder to avoid. There is no way to avoid foreclosure of the house with this scenario of mortgage payments and other expenses.
There is no way of keeping consumers in there homes no matter how hard they work, if ever. Those that are hiding from the collection agencies and the courts already have no homes or other means to pay back the entities that cannot seem to forgive a debt. I know personally that a debt could never be forgiven, especially when the debtor could never pay back in the first place.
Consumers of any type of credit are borrowers. Most of the borrowers happen to be strapped for much needed cash. Cash could be obtained by home equity and (in my case) cash advances on credit cards. Cold hard cash obtained by these same borrowers (herewith known as debtor) is never enough. The tendency is for more cash, which furthers the cycle of debt.
As mentioned by Senator Chris Dodd in this morning’s speech via CNBC news on cable, there are tools that should keep the market working and credit flowing. A broker, for example, is one tool to help raise money from willing investors, whom I describe as nothing more than gamblers in my previous blog. A broker, as the word implies, is like a pied piper that leads the unwary to ‘go broke’ or penniless. A broker is like a bookie and both types gamble, which is like trading on the floors of the markets.
The best correction is stopping any fees, charges and usury on interest altogether! By eliminating any extra cost for lending, a temporary tourniquet (easing portfolio caps for Fannie Mae and Freddie Mae or yesterday’s miniscule attempt by the Feds to lower the discount rate of lending by half a point) on any hard working member of its borrowing body (herewith known as debtor) does not have to choke off its own blood supply – die and drop off.
Copyright © 2007 by Fluffy von der Flynn. All rights reserved.
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