Tuesday, 28 July 2009

Ruthless defaulters

The debt serfs in America are starting to revolt.

From the New York Times....

Melissa Birks is being stalked. Her cellphone keeps ringing, always from a caller marked “unknown.” She says she knows it is her credit card company wondering why she stopped making payments. Ms. Birks, who owes $28,830, has nothing to say.

Those on the front lines of the debt industry say there is a small but increasingly noticeable group of strapped consumers who, like Ms. Birks, are deciding they will simply stop paying. After loading up on debt eagerly provided by the card companies during the boom times, these people now find themselves trapped in an endless cycle where they are charged interest on interest and fees upon fees while the lenders get government bailouts.

They are upset — at the unyielding banks and often at their free-spending selves — and are pre-emptively defaulting. They could continue to pay for a while longer but instead are walking away. “You reach a point where you embrace the darkness of default,” said Adam Levin, chairman of the financial products Web site Credit.com.

The lending industry term for these people is “ruthless defaulters.” In a miserable economy where paychecks, savings and expectations are all diminished, their numbers will surely grow.

11 comments:

electro-kevin said...

Ms Melissa Birks is an anogram for Melissa Smirks with a 'B' left over.

The 'B' is for bitch. I blame the lender for not checking these simple facts out in the first instance.

AN said...

"I blame the lender for not checking these simple facts out in the first instance."

The lender did check everything. Bank executives received immense bonuses between 2000 and 2008 because their banks "grew", i.e. they gave away more money as ever.

Now banks are failing and taxpayers have to shell out to clean up the mess. But the bankers keep their bonuses.

Just one example - Angelo Mozillo, former CEO of Countrywide, walked away from a cool $1 billion. Now Countrywide almost failed, but "luckily" Bank of America picked it up in 2007. Now, it's the turn of BofA to fail sometime in 2010..

AN said...

Above, he walked away _with, definitely not _from_, $1 billion :)

electro-kevin said...

Angelo Mozillo - an anogram for...

Ozone, lilo, mag

This means stuff the environment - enjoy holidays in sunny climes lying down and reading whatever pap takes your fancy.

electro-kevin said...
This comment has been removed by the author.
electro-kevin said...

Stuff the economy.

K T Cat said...

Pathetic. Running away from commitments you made is pathetic.

formertory said...

I rather imagine that Melissa needed no invitation or encouragement to spend. Funny how it's always the banks and the card companies at fault for people owing huge amounts on cards.

And funny how the serial offender always manages to forget lying through their teeth to get the facility in the first place.

But as usual, it'll be the honest, reasonable majority who'll pay for the financial incontinence of the few. I'd rather like to see a few "ruthless defaulters" ended up ruthlessly breaking rocks for minimum wage to pay back their debts. Pour encourager les autres.

wildgoose said...

I'm not exactly sure what to make of this. The idiocy of running up such huge debts, the idiocy of lending such huge sums and indeed the idiocy of insisting on still charging a 19% loan rate when interest rates have crashed through the floor and the government has sprayed taxpayer largesse at you.

But the biggest idiocy is letting people know that they can be forgiven some of their debts - but only if they default first.

Madness.

Anonymous said...

Ruthless Lender meets Ruthless Defaulter. Love it!!

Anonymous said...

wildgoose, the forgiving of debts only after default is US government policy.... thank the democrats.