Although African-American households are in less debt today than they were in 2008, credit card debt and bad credit continue to affect the Black community disproportionately. According to an NAACP report, “The Challenge of Credit Card Debt for the African American Middle Class,” approximately 42 percent of African-American households in debt borrow simply to make ends meet and to pay for basic expenses, such as groceries, rent and utilities.
“We’re also seeing African-Americans turn to credit cards to cover their household finances as incomes continue to stagnate and unemployment rates hover around twice that of white workers,” said Catherine Ruetschlin, report co-author and Demos policy analyst”
In New York, African-Americans have worse credit scores than their white counterparts, according to the report. Late student loan payments and credit report errors add to the reasons for their low credit scores. For white households, the main culprit was late mortgage payments.
In many cases, delinquent accounts are turned over to collection agencies that hire lawyers to represent them. Debt collection agencies and law firms enjoy an immense advantage over self-represented litigants.
The Feerick Center for Social Justice and the New Media Advocacy Project have launched an innovative video aimed at promoting legal empowerment by educating the public about how to handle consumer debt cases. Thousands end up in court uneducated or leave court exploited.
The video is part of an ongoing effort to assist unrepresented consumers facing an onslaught of cases filed by creditors throughout the state.
“The video is part of a ‘quiet revolution’ in which lawyers and tech companies are utilizing creative technology to tackle the growing problem of civil defendants without access to legal representation,” said Adam Stofsky of the New Media Advocacy Project, an innovative nonprofit organization that produced the video and built the website. For more information, go to clarovideo.org.