DINKs Back in Oregon, Economy Not Doing So Good

by Dual Income No Kids on July 10, 2009 · 0 comments

Hello All,

Miel and I are back in Eugene, Oregon for this weekend. Miel is attending the Oregon Country Fair and I’m visiting family in town. Being back in Oregon is wonderful. The mornings are quiet relative to the busy east coast and the air and water are much cleaner.

However, the economy is absolutely the pits out here. Unemployment locally is roughly 14%. And we’ve been seeing signs that times are tough. For example, my mom Gretchen is a unemployment claims judge and her office is getting hit with way more unemployment claims filings since last year.

She also volunteers as a legal aid lawyer for senior citizens in Eugene. Once or twice a month she heads to a local senior center and talks with retirees who are having legal problems. Many of these problems revolve around debt issues.

For example, she had one client, a senior who relies on Social Security. This gentleman earns about $1,100 per month but had to borrow for house repairs. He was making payments – they had been figured into his budget – but missed a month. It is unclear why. Bank of American then started a cascade of increased interest rates and minimum payments. This left this gentleman with with an effective interest rate of about 38% and a debt balance of over $20,000 – hugely more than the original amount. Because this person is on a fixed income, he will never be able to pay the debt off. With the high level of unemployment, its tough to get the kind of part time jobs that a senior could otherwise use to supplement his income. In short, this poor guy is just out of luck. Even if he lives an extremely frugal life, there is no way he can dig himself out of his debt in his current situation.

The take home message here is that the economic downturn locally, at least among some people, is being exacerbated by predatory lending.

Best,

James

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