

Millions of Americans Get Wages Garnished Over Credit Card Debt - user_235711
http://www.npr.org/2014/09/15/347957729/when-consumer-debts-go-unpaid-paychecks-can-take-a-big-hit

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joshuaheard
People don't wake up one day and find their wages garnished. They must have a
lawsuit filed against them, be served with a summons, get a judgment against
them, and finally have their wages garnished. And the money that is being
garnished is to pay back the creditor for the money and/or services that the
debtor received. It's called justice.

~~~
smtddr
_> >And the money that is being garnished is to pay back the creditor for the
money and/or services that the debtor received. It's called justice._

I wouldn't describe a big CC corp bringing a citizen to near-financial-ruin as
"justice". While you are probably factually right and all the legal procedures
more or less followed, this article still highlights a problem with our
current system. That it drains people who are already weak. Kicks 'em when
they're down.

~~~
hnal943
Of course the option is to not extend them credit at all so they avoid these
Faustian deals. Of course, denying poor people access to credit is going to be
politically unpopular.

~~~
TheOtherHobbes
>Of course, denying poor people access to credit is going to be politically
unpopular.

The real problem is that denying poor people decent wages has been popular for
too long - which is why they're poor.

You can't run a sane, stable society by economically disenfranchising most of
the population.

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kenj0418
\- Option 1: Avoid getting into debt

\- Option 2: Pay your bills on time

\- Option 3: File Bankruptcy

If you haven't taken option 1 or option 2 and you start getting court notices
- then it's time to start talking to someone about option 3.

~~~
Zikes
You know how much it costs per hour to talk to someone about option 3? Even
trying to prove how broke you are costs a lot of money.

~~~
reverend_gonzo
Bankruptcy attorneys generally charge a fixed rate, and there are pretty
stringent laws about what they can and can't charge.

Furthermore, the lawyer will do all further dealings with your creditors to
get the amount owed cut down. If you're in the position where you can't pay
your bills, you absolutely need to talk to an attorney.

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jschwartzi
The more I learn about what happens to people who are in debt and fall into
hard times, the less I want to buy anything with credit.

~~~
gretful
Credit is a trap for the unwary and those that fail to plan ahead. I include
myself in that group, as I have credit debt. Don't do - save your money.

~~~
geebee
My brother asked me for advice, when he was in college, about whether he
should get a credit card. I told him that he should, if he was confident that
he make a small charge and consistently pay the bill, on time, every month.
However, if he wasn't confident that he could do this, he shouldn't. He
decided against the credit card.

In retrospect, I didn't give him good advice. It's not that the overall
approach is a bad one, but I didn't understand or emphasize just how important
it is to establish a credit history. When you're in college, credit card
companies will offer you a line of credit even if you have no previous credit
history. If you can charge $10 a month, and pay it on time every month, for
several years… I'm not kidding, banks will lend you $750,000 to buy a house at
the most favorable rates 5 years later simply based on your demonstrated
ability to pay $10 a month reliably and _not_ run up a $10,000 debt just
because you can. It's a test, and it's an important one to pass - but if you
aren't going to pass, don't take it (yet). You will need to eventually.

If you don't take this test and pass it, banks will at best charge you a
higher interest rate that could actually cost you well over 100K over the
lifetime of the loan. They might not loan to you at all.

So yeah… if you can't handle credit, don't do it, but be aware of how
important it is to establish a credit history.

~~~
gretful
yes, like fire, credit is useful servant but a terrible master. If you relax
your attention it's easy to turn the relationship upside down.

------
cryoshon
"One in 10 working Americans between the ages of 35 and 44 are getting their
wages garnished. That means their pay is being docked — often over an old
credit card debt, medical bill or student loan."

Think about how severe of a situation this stat depicts.

News like this really destroys the "economic recovery" propaganda that the MSM
trumpets. People have no cash in hand. The income they do have is being ripped
from them rapidly via debts of various kinds. The result is society-scale
movement towards poverty.

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zo1
Do you not have something like this in America:

[http://www.liberty.co.za/our-products/protecting-your-
income...](http://www.liberty.co.za/our-products/protecting-your-
income/personal-income-protection/Pages/personal-income-protection.aspx)

It's pretty much a sort of "insurance" that then pays out your salary for X
amount of time if you become unable to work for whatever reason. There are
many different types/kinds of this type of thing here...

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kolev
Reading the responses here, I think you guys are completely disconnected from
the reality, because you (like me) are lucky to have a high-paid high-in-
demand profession! There are people in America who go to bed hungry - and not
because they overspend or manage finances poorly. Just go over at
[http://www.feedingamerica.org/](http://www.feedingamerica.org/) as starters!

~~~
zo1
"overspend or manage finances poorly"

The sort of debt that you're talking about goes way further than the narrow
perspective that most take on it. It begins before you are even born, and I
think we should all ruminate on that.

Let me elaborate a bit, despite consistently getting down mods for expressing
this point of view before. The debt begins with the parents that choose to
have kids when they are unsure of their financial wellness and security for
the years to come of their child's growth to adulthood. i.e. People shouldn't
be having kids unless they're damn sure they can take care of them till
they're adults and able to take care of themselves.

~~~
reverend_gonzo
Huh? How many people in their 20s know for sure that they're going to be
financially well off for the rest of their lives and there isn't going to be a
stock market crash or some tragic event that substantially changes the
economy?

I have friends who were commercial airline captains in 2000. Then 9/11
happened, and they went on furlough for a number of years and had to work
places like Best Buy.

You're saying they should've known that their career was about to get upended
and shouldn't have kids because of that?

~~~
zo1
I wouldn't say they have to do anything drastic, but just make sure that they
have a reasonable buffer. Individuals that are in those sorts of situations
have many more options available to them when unforeseen life events occur.
However, much of the ladder below them is fraught with people that would be
ruined if even a delicate imbalance in their lives occurred.

Those are the types of people that need to watch their actions, and count
their beans carefully. They're the ones I was speaking of specifically.

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danielweber
Mods, please fix the title to match the article. Millions are having wages
garnished over "credit card debt, medical debt, and student loans." No
breakdown is given among categories.

This is a serious enough issue without misleading headlines.

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hughes
It's hard to see these "millions of americans" as victims in this matter. It's
almost always possible to just _not buy_ something if you can't afford it.

~~~
Kalium
Just like millions of Americans conscientiously choose to not buy food and
life-saving medical care each day!

Life isn't always as simple as "don't buy more things".

~~~
zo1
Don't forget these two: "Save when you can, instead of spending". And "don't
have kids you can't take care of, so they don't end up starving and unable to
pay for 'life-saving medical care' when they're older."

~~~
Kalium
Don't forget to fully anticipate the future with perfect accuracy so you can
be sure that you'll be certain of your ability to afford kids.

Life is uncertain and variable. Demanding that people make choices based on
unknowable futures is a bit silly.

~~~
zo1
_" Life is uncertain and variable. Demanding that people make choices based on
unknowable futures is a bit silly."_ And what about demanding that other
people pick up your burden if the unknowable future impacts you negatively? It
works both ways, you know.

You are 100% correct, life is uncertain and variable. And there is no way for
anyone to fully anticipate the future with perfect accuracy. However, that
right there is _the_ most powerful reason that should be compelling
individuals to be more careful and risk-averse. Especially when it comes to
family, kids and health.

~~~
Kalium
You should think carefully before calling for risk-averse behavior on a site
closely affiliated with ycombinator.

~~~
zo1
Why? Care to elaborate on that?

~~~
Kalium
Ycombinator exists to encourage highly risky behavior. Specifically, founding
a startup.

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EGreg
Aren't there bankruptcy protections?

~~~
jschwartzi
There are none for student loans. If you file bankruptcy they're the only kind
of debt that you can't discharge.

~~~
jrs235
You can get student loans discharged. It's a misconception that many believe,
even lawyers. It's just very, no, extremely, difficult to do so.

ADD: From the horses mouth: "However, certain circumstances might lead to your
loans being forgiven, canceled, or discharged." (
[https://studentaid.ed.gov/repay-loans/forgiveness-
cancellati...](https://studentaid.ed.gov/repay-loans/forgiveness-cancellation)
)

~~~
jschwartzi
Huh. That contradicts what I remember from my exit counseling. Perhaps it's a
useful misconception?

