Nearly one in five residents with credit card debt has balances in collections, according to Illinois Legal Aid Online. More than 50% of Chicago debt collection cases end in default judgments, which can allow creditors to pursue wage garnishment or seize money from bank accounts.
Nicola Barts/PEXELS
by Judith Ruiz-BranchPublic News Service
CHICAGO - As the affordability crisis strains household budgets, polling data show nearly one-third of Americans worry about their debt load almost every day. In Illinois, nearly one in five residents with credit card debt has balances in collections, according to Illinois Legal Aid Online. Steve Uhrich, ILAO consumer debt solutions product manager, said many people do nothing about it because they can’t afford to pay the balance and believe there are no other options. "They owe a few thousand dollars on a credit card or medical debt, and they don't have a few thousand dollars in the bank," Uhrich explained. "The thing is, they do have more options available to them, and they can often negotiate a discounted settlement." To help people navigate potential alternatives, ILAO has developed a self-help online resource, called Debt Help Illinois. The chat-based website asks users questions, then provides tailored guidance. As legal needs often outpace available resources, Uhrich said the website is designed to help fill what he called "the justice gap" for residents, to help determine whether they need to consult a consumer attorney. Uhrich warned that ignoring debt can make matters worse, particularly when creditors file lawsuits. Research by The Pew Charitable Trusts found that more than 50% of Chicago debt collection cases end in default judgments, which can allow creditors to pursue wage garnishment or seize money from bank accounts. Uhrich said ILAO's goal is to help people deal with debt early – before it turns into a lawsuit or judgment. As he put it, "This website isn't just for people who have been sued. We also see it as a resource for folks who are just dealing with debt generally and don't know where to start." In addition, he advises people to be leery of debt settlement companies that ask for money up front or claim they can settle accounts for less than what is owed. He stressed that creditors are typically open to negotiating a deal directly after an account has become delinquent. "If they can get someone just to talk to them, they're usually very willing to negotiate, and that's particularly true if it's a debt buyer," Uhrich noted. "And then, there are special rules that actually protect consumers from debt collectors and debt buyers, and we try to get into all of that on our website." He said some Illinois residents may be considered “collection-proof,” meaning their income and assets are protected from collection for certain consumer debts under state and federal law. He also offered reassurance that generally people cannot be jailed solely for not paying a debt unless they fail to obey a court order.
