CLEVELAND — With prices on just about everything up and still high interest rates, recent troubling reports show there are record numbers of people piling up all-time highs for debt. If you’re on that path, News 5 Investigators dove into what’s happening in Ohio and how a non-profit organization could help you.
“It was just like slowly losing control,” said Gene Florian from Brunswick.
His finances had many damaging bumps along the way.
“I would get a 0% introductory rate, max that one out, and then hopes that I would get another offer and jump on that one,” explained Florian.
Pretty soon, he said, he found himself tens of thousands in debt.
“Starting to do the math and I’m just like this won’t add up,” said Florian. “The amount of money I was bringing in just wasn’t cutting it for what was going out.”
DEBT ON ALL LEVELS HAS GROWN SIGNIFICANTLY
He’s certainly not alone. Over the years, as the U.S. government’s debt has grown to never-before-seen heights, the feds reported for the second quarter of this year that mortgage balances are way up, auto loans took a big jump, and like Florian's credit card issues, Americans racked up big time card troubles.
“It was like looking back, and I was like, 'Oh, what did I do?'” said Florian.
He told us he was sliding further and further into debt. So, he called the credit card companies. However, they said there was nothing they could do, but there was a nonprofit group that could help.
“It’s really tough right now on a number of fronts,” said Thomas Nitzsche from the nonprofit group Money Management International or MMI.
He said in Ohio, they’ve seen a 44% increase in new clients year over year. Plus, more bad news.
“Almost half of our new clients are solidly middle-class Americans, which, obviously, is not a great sign when more middle-class Americans are struggling with higher levels of debt,” said Nitzsche.
FUNDING FOR HELP COMES FROM SEVERAL AVENUES
He told us MMI is partially funded through grants, even some from Housing and Urban Development or HUD, and it provides many free services to evaluate your budget, understand your credit report, and make suggestions.
“Most of us here absolutely know how it feels and that sort of debilitating stress can really affect a lot of things, your personal relationships, your mental health,” said Nitzsche.
If you happen to get into a debt management plan with MMI, Nitzsche said creditors pay a portion of the fees, and as you pay your bills, you give under 25 bucks a month to the agency.
They put Florian on a 4-year plan with some lenders able to swing 5-10% for him and even 0%. With all that help, he was able to walk down a better path and pay off what he owed in three-and-a-half years.
“It was a relief just that I’m able to maintain my current situation at home and also just whittle this debt down,” he told us.
CFPB WARNS ABOUT DEBT RELIEF OPTIONS
The Consumer Financial Protection Bureau warns to be careful of the kind of services you use to get out of debt. It reported that “credit counseling organizations are usually nonprofits” and “debt settlement companies… and credit repair companies are typically for-profit… and charge you money for things you can do yourself for free.”
