I have always had a healthy skepticism of debt settlement companies.  As a practicing bankruptcy attorney I meet with people each week from both Missouri and Kansas, several of whom have tried debt settlement/consolidation often with little to no results after paying hundreds if not thousands of dollars in to these companies only to end up in my office burdened with the same amount of debt.  Many people operate under the rightful assumption that once they begin sending money to these companies that their debt is being taking care of. However, the reality is that most of the time these funds set in an account until enough accumulates for the company to pay itself first for its fees before any action is taken to reach settlement with the person’s creditors.  This leaves the consumer open to continuing collection efforts and legal action from creditors. 

As reported in the Kansas City Star new legislation is being sponsored by U.S. Senator Claire McCaskill and Senator Charles Schumer from New York to try to regulate the operations of an estimated 2000 debt settlement companies in the U.S.  The Debt Settlement Consume Protection Act as the bill is called seeks to require debt settlement companies to provide adequate written disclosure of their services, ban payment of upfront fees before services are provided and limit the types of fees such companies can collect.

Even if such legislation is put in place, consumers would be wise to consider all options available to them to handle outstanding debt including consideration of debt settlement vs. bankruptcy. 

As being widely reported in the news, a local Shawnee teenager, Hannah Deaver, 17,  was killed Saturday when a vehicle competing in a mud event competition veered off course and into the spectator’s area which had been allowed to form near the finish line.  Hannah had been watching the event from the bed of a pick-up truck when the accident occurred. She died from her injuries later at a Wichita hospital. Local law enforcement is still investigating the incident and whether charges should be brought.  Criticism is being lobbied at the fair organizers for allowing spectators near the finish line. 

As reported in the Kansas City Star, early Sunday morning in 3500 block of Terrace Street in North Kansas City a young 5 year old boy was mauled by three dogs as he apparently was sleeping. The boy and his mother were staying overnight at the home in which they were visiting.  The mother awoke to the sounds of the dogs barking and when she went in to check on her son she found the home’s two large Rottweilers over her son. He was covered in blood and had suffered bites over his entire body.  The mother grabbed her critically injured son and ran to a neighbor’s house for help.  The neighbor described the boy’s injuries as “gruesome” and a doctor who treated the boy at the hospital told police they were the worst injuries he had ever seen from an animal. 

The dogs had a history of bite attacks including a 2007 incident in which they had injured the owner’s girlfriend.  The three dogs were put down by animal control workers following the Sunday incident.

Children are the most likely victims of dog bites, and boys ages 5-9 have the highest incident rate. The majority of attacks happen in the home or in a familiar place.  The face is the most frequent target of such attacks making up 77% of all bite injuries.

A new survey done by Pew Research Center shows that of those who have experienced unemployment for at least six months since December 2007 (when the recession began), 44% report that the recession has caused “major changes” in their lives.  The current average duration of unemployment is 25.5 weeks, which means half of the unemployed having been looking for work for six months or more.  While certain groups have experienced higher durations of unemployment (older workers, blue-collar, African-Americans), overall all workers have seen a significant increase in long-term unemployment during the recession. 

The impact of long term unemployment is not just financial either.  Nearly half of those surveyed who had been unemployed at least six months or more say that their joblessness has strained family relations, and 43% say they lost contact with close friends. 38% reported they have lost some self-respect and 43% felt that the recession would have a “big impact” on their ability to achieve their long term career goals.  7 out of 10 long term unemployed reported they either changed their career or job field or seriously thought about doing so, and of those who found work after 6 months of unemployment, about 29% say their new job is worse than the one they lost.  Overall adults who have been unemployed for six months or longer are significantly more pessimistic than the short-term unemployed about their chances of finding a job as good as they lost. 

Current economic forecasts show that the job market may take until 2014 to recover. 

Over a half a million homes were taken over by lenders in the first 6 months of the year with most experts forecasting the number to hit 1 million by the end of the year as lenders work their way through huge backlogs of delinquent loans.  Historically the number of homes foreclosed during any given year is closer to 100,000 homes. Last year in 2009, 900,000 homes were lost to lenders. 

1 in 78 homes in the U.S. received a foreclosure related warning during the months of January to June this year.  At the same time, borrowers who have fallen behind on their mortgages are being allowed to stay longer in their homes as lenders attempt to manage the number of distressed assets on the market.  According to Lender Processing Services, it takes on average about 15 months for a home loan to go from being one month late to the property being foreclosed and sold. 

The nature of the households who are entering foreclosure has changed since the foreclosure crisis first began. Initially the high foreclosure rate could be blamed on lax lending standards, so-called sub-prime loans, which allowed people to purchase more house than they realistically could afford. Now however, homeowners with good credit who took out conventional, fixed rate loans are the fastest growing group of foreclosures.  This shift points to the fact that unemployment or reduced income is now the main culprit behind this year’s foreclosures. 

Nevada had the highest foreclosure rate for the first six months of this year, followed by Arizona, Florida, California and Utah.  Neither Kansas nor Missouri were in the top 10.  Peter Jouras can provide more information by being your foreclosure attorney