The High Cost of Being Poor

[Sapphire Blue]

Wednesday, October 11, 2006
The High Cost of Being Poor


The Center sponsored a panel to explore the ways that being poor in America is expensive, delving into issues of predatory lending, lack of access to banking services, rent-to-own stores, higher credit costs and lack of access to affordable goods. These issue were covered recently by two of the panelists--Rod Watson and Jonathan Epstein--for the Buffalo News, in an extensive four-part series which led to legislative discussion and potential action on behalf of the working poor. Laura Hogshead, former Assistant Director the of the Center, moderated this session, and former Director John Edwards served as the lead discussant/questioner. The panel was held in the auditorium of the School of Social Work from 4-6 p.m. Panelists were:

Michael Barr, Professor, University of Michigan School of Law
Jonathan Epstein, Financial Reporter, Buffalo News
John Herrera, Chair, Latino Community Credit Union
Mark Pierce, formerly President of the Center for Responsible Lending and currently Deputy Director of the Office of the Commissioner of Banks
Rod Watson, Urban Affairs Editor, Buffalo News

Watch the panel to hear our panelists recommendations and ideas: http://mediaserv.unc.edu/ramgen/povertycenter/2/highcost.rm.


http://www.law.unc.edu/centers/details.aspx?id=430&q=3

Ending Poverty in America

JOHN EDWARDS for PRESIDENT 2008

:woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo:

:bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce:
:bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce:
:bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce:

Transformational Change For America And The World - JOHN EDWARDS 08

"I'm proposing we set a national goal of eliminating poverty in the next 30 years." - JOHN EDWARDS 08

Silence is Betrayal - JOHN EDWARDS 08

[Monkeyman]

1. K&R

:bounce: :bounce: :bounce:

[Sapphire Blue]

5. Thank you, Monkeyman!

:bounce: :bounce: :bounce:

[liberal N proud]

2. Kick & Recommend

[Sapphire Blue]

6. Thanks, liberal N proud!

:bounce: :bounce: :bounce:

[no_hypocrisy]

3. It's like there's a conspiracy to KEEP you poor.

If you have a bad couple of months, you might be late on paying some bills. That gets reported to the credit companies. They contact your credit card company which increases the COMPOUND interest on your balance because you were late with OTHER bills. This in turn is reflected on your credit report. And because your credit report is now compromised, your auto insurance rates are higher than if you had a stellar report because of your "risk" of being able to pay "on time" or more likely to put in a claim (assumption on your "slovenly" lifestyle). And then you want to buy a house. Either you're turned down because you can't afford one, or worse, the subprime predators give you one with an adjustable rate interest. You might lose the house because you can't afford to pay the NEW amount of the mortgage, your higher credit card bills, your higher auto insurance premiums, and heck, your necessities. It's almost a tale from Dickens how impossible it is to climb out of the debtor's pit.

Book recommendation: In Debt We Trust.

[Sapphire Blue]

8. John Edwards on predatory lending...

Fight Predatory Lending. Home ownership promotes economic security and, for most families, is the top generator of wealth. However, predatory lenders use deceptive terms and abusive interest rates and fees to strip away families' equity, reducing the amount of wealth they have saved in their homes and sometimes depriving them of their homes entirely. Edwards called for fair rules to protect homeowners.


http://johnedwards.com/about/issues/poverty/

[LuckyLib]

28. This is CRIMINAL: "They contact your credit card company which increases the COMPOUND

interest on your balance because you were late with OTHER bills."

These thieves need to be stopped!:grr:

[jwirr]

4. K & R

[Sapphire Blue]

7. Thanks, jwirr!

:bounce: :bounce: :bounce:

[Lars39]

9. ductapefatwa's Advice for the New Poor:

http://ductapefatwa.blogspot.com/2003/11/advice-for-new-poor-part-1-some-advice.html

[Sapphire Blue]

11. "The purpose of this thread is to help you understand some of the changes that accompany...

... this new chapter in your life." - Advice for the New Poor


:kick: ... for understanding. Please consider posting this in a new thread; it really is excellent.

[Mark Twain Girl]

13. Okay, I just started reading that link, with Advice for the New Poor

It's very insightful... unfortunately. But a must-read piece.

Kicking this excellent thread.

[Lars39]

19. Definitely compelling reading.

ductapefatwa was a DUer when he wrote the series.
It was hard waiting for the next installment.

[BluePatriot]

24. Oh, a must-read piece

Looks like he's added some since last time I saw it.

Sigh. I don't know what's going to happen to our country. I wish I had something to look forward to as a young person. I feel like it was a coup getting FT/benefits work in an office as a clerk, with a college degree.

[truedelphi]

10. How about the domino effect of bouncing one check

At 22 to 33 dollars a pop, the poor are decimated by this cost.

if it only cost US Bank in oregon $ 3 to deal with bounced checks in the early nineties - how can it be that it suddenly costs eleven times that in 2007?

[Sapphire Blue]

15. And the predatory lenders welcome them w/understanding, compassion & open arms.

:sarcasm:

Have you heard those ads? They're so caring! :sarcasm:

[ComerPerro]

18. its even worse if you go over on your check card

5 transactions at $2 each, resulting in an overdraft of $10 total, will cost you $175 and then $7 every day until you are positive again.

[Horse with no Name]

12. K&R

Poverty begets poverty.
The people that least need the help get the most.

[Sapphire Blue]

16. Thank you, HWNN!

"The people that least need the help get the most." - Life in bushAmerica.

[Catherine Vincent]

14. I'll kick this too.

:kick:

[Sapphire Blue]

17. Thanks, cat_girl25!

:hi:

[dropkickpa]

20. Rent to own companies are repub

They have fought legislation across the country that would set up limits on their predatory practices, and repub representatives have worked to block this type of legislation while they introduce their own that would actually sheild rent-to-own businesses from the regulations that retail sales are held to. Oh yeah, Dick Armey was/is on the Rent-a-Center board of directors.

Article http://www.buffalonews.com/281/story/43335.html

[Sapphire Blue]

21. And those rent to owns & other predatory lenders are popping up everywhere like dandelions.

[dropkickpa]

22. I prefer to call them cancer

My guinea pigs love dandelions.

[Sapphire Blue]

23. Much more fitting... metastatic cancer, nuclear grade 9.

[Bluerthanblue]

25. thank you for this post- glad to K&R............. ..eom

[Sapphire Blue]

27. Thanks, Bluerthanblue!

[slackmaster]

26. My most recent serious girlfriend was poor, it was an eye-opener

Nickel-and-dimed to death at every turn. No hope of getting out of it without going after the father of one of her daughters, but she had no intention of doing that because he is such a scumbag.

[bobbolink]

35. I'm glad she opened your eyes.

Now, it's your turn to get liberals to understand.

[Sapphire Blue]

29. kick

Ending Poverty in America

JOHN EDWARDS for PRESIDENT 2008

:woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo: :woohoo:

:bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce:
:bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce:
:bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce:

Transformational Change For America And The World - JOHN EDWARDS 08

"I'm proposing we set a national goal of eliminating poverty in the next 30 years." - JOHN EDWARDS 08

Silence is Betrayal - JOHN EDWARDS 08

[AZBlue]

30. K&R

[Sapphire Blue]

37. Thank you, AZBlue!

[Wilms]

31. How true.

Thanks for illuninating.

[calimary]

32. The penny-wise/pound-foolish mentality that has infected our government

since the rise of reagan is primarily to blame for this. I wish we could adjust the framing on this, to help America understand that a little bit of investment in social programs goes a LONG way toward prevention - of a whole lot of social ills. Proactive is always the way to go, because meeting the costs up front always saves a whole lot more in the long run. But who the fuck cares, anyway? As bush himself puts it, in 50 years, we'll all be dead, 'eh?

:grr:

[bobbolink]

33. Here's my CUTE example of being kept poor:

Start with having my Social Security cut (and please read and kick this thread while you're there!)
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=843658&mesg_id=850319

So, there I was, no $$$, not even for EATING, let alone anything else.

FOR FOUR MONTHS. NOTHING I COULD DO.

In that time, my car insurance came due. My car had broken down, so I wasn't driving in it (or sleeping in it, as I couldn't move it from place to place!). So, I couldn't pay my car insurance. I figured since I had been a perfect driver and perfect customer for almost 40 years to the same company, and wasn't driving, that IF I LIVED, it would be understood.

HAH!!!

I was PUNISHED FOR NOT PAYING CAR INSURANCE, and have to have higher rates, even though I HAVE A PERFECT DRIVING RECORD, AND PERFECT INSURANCE RECORD.

How's that for being rewarded for doing good?

It's even a wonder I survived, yet where is the LIBERAL OUTRAGE?

WHERE IS THE CONCERN?

WHERE IS THE COMPASSION?

WHERE IS THE HELP?

HELLO---ANYONE OUT THERE?????

[Sapphire Blue]

38. I'm here, bobbolink... and I'm trying.

:hug:

[bobbolink]

43. Yup, you and a few others are doing your damndest...

They rest are more interested in Paris Hilton etc., than even reading a thread like this.

What the hell does it take?

I'm ever greatful for your faithfulness on poverty!!!

Otherwise, the rest of us would be *COMPLETELY* invisible!

:yourock: :hug: :loveya:

[lildreamer316]

40. Yeah, that one caught me by suprise too.

Until a year or two ago, my state didn't charge for letting your insurance lapse. NOW; they do.I went to renew my tags on one car and had to pay and extra THREE HUNDRED dollars ($100 per lapse).

What the fuck ever.
Took me three months to come up with the money, too.
It's bullshit.

[DarkTirade]

41. I've been in a similar situation...

and it turns out in my state, even if you aren't driving, as long as you own a car, you have to have insurance on it... or else your liscense gets suspended.
So I had to pay over a hundred bucks just to get my liscense back once I was back on my feet enough to get insurance again. AND my insurance went up... because of the fact that I had a suspended liscense.

[bobbolink]

42. Was your situation similar--- had no money to even EAT?

My point was-- over 300,000 (at least---probably very incomplete figures!) cut from their Social Security, no money to survive, so obviously impossible to pay insurance!

That's NOT THE SAME as letting it lapse.

[DarkTirade]

44. It lapsed BECAUSE I needed to use that money to eat.

It was not a choice. It was something that was forced on me.
My job of 2+ years had just gone under. No warning. The boss ran out of money, then took off with what little was left instead of staying to pay us for our last month of work there. Right at that same time, my phone company made a 200 dollar mistake on my bill, refused to admit their mistake, and cut off my phone. I had no money for gas to go out and look for a job, I lived outside of walking distance of just about any possible job except for a few gas stations, and my phone was cut off. Add on top of that, that this was right after Orlando had just been hit by three major hurricanes... so everyone who had some kind of property damage had just gone out and gotten a job. The month before my job went under had the largest job growth of any month in the previous ten years. So everywhere I went, I was told "I'm sorry, we just hired five people."
And just to add salt to the wound, my bycicle was broken, so I couldn't expand my job hunt without using gas that I couldn't afford, and none of my family was in a financial situation to help out.
This was about survival. And that is WHY it lapsed.

[DarkTirade]

45. Still, my point is that what happened to you and me

is a simple case of a tax on the poor. It may not be officially called a tax, but that's what it is. We were charged extra money for being too poor to afford something in the first place.

[Cobalt-60]

34. my bank charges fees whenever they detect a low balance

rather than on any given day.
They only get one shot per month,
but it's obvious they're trying to force bounce some checks.
I'd change banks but my pay is so scarce that I never have enough to juice two accounts even for a week.
They naturally charge for use of their own atms, so I cash checks at the counter, just like it was 1970.
They charge a dime for that, but its 1/5 the atm fee.
The first day Im flush enough Ill open a credit union account and close out the old one.

[Forkboy]

36. Your threads are pretty easy to K&R.

So I shall. :)

[Sapphire Blue]

39. Thank you, Forkboy!

:hug:

[waiting for hope]

46. 'Tis with pleasure I K&R!

:kick: :thumbsup:

:bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :hi:

[Sapphire Blue]

47. Thank you, WFH!

:hi: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce: :bounce:

[Patiod]

48. There's also DWP

Based on my observations, I am a big believer in Driving While Poor, which is related to DWB (I think that some -- but obviously not all -- DWB stops are also DWP) I think cops are WAY more likely to stop older cars, assuming that there will be a much higher chance of them having lapsed insurance, lapsed licenses, lapsed registration, or some additional violation.

I have a decent car, and my SO drove a beater. Every single time he went into a local township, he was stopped for SOMETHING. I, on the other hand, was never stopped. We got to the point that when he had to go there, he always took my car (and was never stopped in my nice car).

Recently, I dented the side of my car, and haven't repaired it yet. I had to go into the township, and damned if the very first time I went there with a dented car I was stopped and ticketed for "running a stop sign". I believe I did stop, although I admit it was possible that I may not have come to a 100% stop. The point was, they didn't stop any of the BMWs or Range Rovers that went rolling through the intersection, but they sure as hell stopped my dented car. I haven't gotten a ticket for anything in 5 years, and a week after getting a dent, I get a ticket. Coincidence? I don't think so.

[mdmc]

49. dwp

:kick: