08-19-2022  12:31 am   •   PDX and SEA Weather
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NORTHWEST NEWS

‘Wake of Vanport’ to Be Screened August 28

Register for this free event to be held at Open Signal in Northeast Portland

Heat Returns to Pacific Northwest Wednesday, Thursday

Multnomah County, which includes Portland, will offer people places to stay cool Wednesday as temperatures potentially reach 100 degrees Fahrenheit

Basic Guaranteed Income Program to Launch for Black Portlanders

Brown Hope’s Black Resilience Fund argues the impact of direct cash payments. 

Oregon Justice Fires Panel Due to Lack of Public Defenders

Criminal defendants in Oregon who have gone without legal representation due to a shortage of public defenders filed a lawsuit in May that alleges the state is violating their constitutional right to legal counsel and a speedy trial.

NEWS BRIEFS

Reduced Costs for Parks Programs

Portland Parks & Recreation announces new Parks Levy-funded Access Pass to reduce cost as a barrier for Recreation and...

Measure on Portland Government to Appear as-Is on Ballot

Politicians, business leaders and civic activists have called for reshaping Portland’s form of government, which they say...

The Regional Arts & Culture Council Rolls Out New Grant Program

The Arts3C grant program is designed to be fully responsive to what artists and art makers in the community need funding to support ...

OHA Introduces New Monkeypox (hMPXV) Website

As of Aug. 10, 95 people have tested positive for monkeypox in Oregon ...

Wyden, Colleagues Renew Request for FDA to Address Concerns about Dangerous Pulse Oximeter Inaccuracies Affecting Communities of Color

“There are decades of research showing inaccurate results when pulse oximeters are used to monitor people of color” ...

Court: Extraordinary damages OK in 'wrongful life' case

SEATTLE (AP) — The Washington Supreme Court says that under state law, it's OK for judges to award extraordinary damages in so-called “wrongful life” cases where a child has birth defects or disabilities that require extensive care. The unanimous decision Thursday came in the...

GOP lawmaker arrested, accused of disorderly conduct at fair

CANBY, Ore. (AP) — A state lawmaker was arrested Wednesday on suspicion of disorderly conduct and interfering with a peace officer at the Clackamas County Fair in Canby, Oregon. Republican Rep. James Hieb, of Canby, was arrested Wednesday night and told The Oregonian/OregonLive the...

Mizzou full of optimism with new QB, defensive coordinator

COLUMBIA, Mo. (AP) — Missouri coach Eli Drinkwitz is on his third defensive coordinator in three years at Missouri, and the Tigers are about to start their fifth different quarterback in the season opener in the last five years. Sounds like a program that should be on shaky ground. ...

Hoosiers looking for a turnaround after dismal 2021 season

Indiana linebacker Cam Jones and quarterback Jack Tuttle took matters into their own hands this offseason. They called their teammates together to discuss the goals and aspirations of the program, the need to always play with an edge and to break down precisely why things went wrong...

OPINION

No One Ever Told You About Black August?

Black America lives in a series of deserts. Many of us live in food deserts, financial deserts, employment deserts, and most of us live in information deserts. ...

Betsy Johnson Fails to Condemn Confederate Flags at Her Rally

The majority of Oregonians, including our rural communities, value inclusion and unity, not racism and bigotry. ...

Monkeypox, Covid, and Your Vote

We must start a voter registration drive right here where we live. This effort must become as important to us as putting food on the table and a roof over our heads. ...

Speaking of Reparations

To many Americans, “reparations” is a dirty word when applied to Black folks. ...

AFRICAN AMERICANS IN THE NEWS

Judge throws out M award over California custody death

SAN DIEGO (AP) — A federal judge has thrown out an million lawsuit award over the death of a Southern California man who was beaten, hogtied and shocked with a stun gun by sheriff’s deputies in 2015. U.S. District Judge Marilyn Huff said Wednesday that the March award by a...

Head of Oregon’s troubled public defense system is fired

SALEM, Ore. (AP) — The head of Oregon’s public defenders’ office was fired Thursday in a clash over how to solve a dire shortage of attorneys to represent people too poor to afford a lawyer. Critics for years have said Oregon’s unique public defense system is in crisis, with...

Judge blocks Florida 'woke' law pushed by Gov. DeSantis

ST. PETERSBURG, Fla. (AP) — A Florida judge on Thursday declared a Florida law championed by Republican Gov. Ron DeSantis that restricts race-based conversation and analysis in business and education unconstitutional. Tallahassee U.S. District Judge Mark Walker said in a 44-page...

ENTERTAINMENT

Judge denies bail for Rushdie's attacker, bars interviews

MAYVILLE, N.Y. (AP) — A judge refused to grant bail Thursday to the man accused of trying to kill Salman Rushdie as the acclaimed author prepared to give a talk in western New York. Hadi Matar, 24, appeared in a western New York courtroom after a grand jury indicted him on charges...

Review: 'Three Minutes' a heartbreaking celluloid memorial

What gets you, deep in the gut, are the smiles. The broad, awkward, sometimes silly smiles of people on an unremarkable day in an unremarkable town in 1938 Poland, fascinated by this new thing called a movie camera and oblivious to the fact that one day, this amateur travel movie will become a...

Review: 'Beast,' with Idris Elba, has B-movie bite

Sharks, grizzlies, giant snakes and rampaging apes have traditionally been the go-to choices for animal-kingdom antagonists in survival thrillers. Lions not so much. Maybe the king of the jungle has always been too regal, too majestic — too heroic — to be lowered to the status of mere...

U.S. & WORLD NEWS

House Democrats' campaign chief faces tough race of his own

PEEKSKILL, N.Y. (AP) — At a recent rally with union workers and other supporters in the downtown square of this...

Biden bill to help millions escape higher health care costs

WASHINGTON (AP) — Millions of people in the United States will be spared from big increases in health care costs...

Bomb threats put tiny Moldova, Ukraine's neighbor, on edge

CHISINAU, Moldova (AP) — For tiny Moldova, an impoverished, landlocked nation that borders war-torn Ukraine but...

WHO: World coronavirus cases fall 24%; deaths rise in Asia

LONDON (AP) — New coronavirus cases reported globally dropped nearly a quarter in the last week while deaths...

Saudi doctoral student gets 34 years in prison for tweets

DUBAI, United Arab Emirates (AP) — A Saudi court has sentenced a doctoral student to 34 years in prison for...

AP Week in Pictures: Europe and Africa

Aug. 12-19, 2022 From the presidential election in Kenya to the European Championship being held in...

Charlene Crowell
Charlene Crowell

You’ve probably heard the advertisements on urban radio urging consumers with at least $10,000 in debt to call a number right away for a financial rescue. Promising to end debt troubles by getting creditors to somehow accept less money than what is owed can sound really appealing. In reality, however, consumers mired in debt may often find debt settlement programs to be costly, misleading, and far less helpful than the radio ad promises.

In the newest chapter in the research series titled The State of Lending, the Center for Responsible Lending (CRL) finds that debt settlement is a risky strategy that can leave consumers more financially vulnerable and still laden with debt years after they enroll in such programs.

Regardless of how well consumers follow the instructions of their debt settlement firm, they may ultimately be unsuccessful because many creditors simply refuse to deal with debt settlement companies.

According to the report, “Debt settlement companies do not tell consumers whether creditors will work with their firms at the time of enrollment. However, even if debt-settlement companies were required to disclose whether a particular creditor routinely works with their firm, this provides no real guarantee. In many cases, the party who owns a debt changes over time, since a debt may be sold successively to multiple parties.”

Available data suggests that at least two-thirds of debts must be settled in order to achieve a net positive outcome from debt settlement. Even more debts must be settled for the consumer to achieve real savings if they end up being liable for taxes on the debt reduction.

In the end, many consumers never realize that kind of experience. Rather, they end up worse off financially. According to the American Fair Credit Council, an industry trade association, consumers must typically be enrolled in debt settlement plan for three to four years in order to complete the program. During this time, debt balances grow an average 20 percent while consumers wait for settlements to be reached. Additionally, their credit scores are negatively affected, financial instability increased, and the likelihood of creditor lawsuits loom near.

According to Leslie Parrish, co-author of the report and deputy research director at CRL, “When a consumer stops making payments on a debt, not only is she/he vulnerable to fees and an increased interest rate, the reporting of this delinquency to credit bureaus can impact credit scores for years.”

In general, the higher a consumer’s credit score is, the lower the cost of credit they will incur. Conversely, the lower one’s credit score, the higher the cost of credit and interest will be. Whether applying for a credit card, auto loan or a mortgage, bad credit histories make future credit and borrowing more expensive.

In 2010, the Federal Trade Commission (FTC) issued regulation that barred debt settlement companies from charging fees until they reached settlements with the client’s creditors. While this regulation has stopped some of the most egregious industry practices, CRL’s report finds that significant financial risks remain for debt settlement clients.

Today, the Consumer Financial Protection Bureau shares regulatory oversight of debt settlement with the FTC. Thus far, CFPB has taken multiple enforcement actions against several debt-settlement companies and one payment processor.

CRL also sees a role for states to establish meaningful limits of debt settlement fees. One recommendation is to limit the fees that can be charged and to calculate such fees on the basis of the amount of savings achieved for the consumer.

State and federal regulators could also require better screening of prospective customers to lower the risk of a bad outcome. Factors such as the amount of debt to be enrolled, creditors and the consumer’s financial circumstances would be taken into account. Additional recommendations can be found in the report located at: http://rspnsb.li/1x5lPOe.

Ellen Harnick, co-author of the report and senior policy counsel at CRL, said, “What’s clear is that more action is necessary to protect consumers.”

Charlene Crowell is a communications manager with the Center for Responsible Lending. She can be reached at Charlene.crowell@responsiblelending.org.  

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