With a population of 12.7 million, the Commonwealth of Pennsylvania is the 6th largest state in the United States and the 33rd largest by geographical area. Just like any other state in the country, Pennsylvania has had its fair share of economic woes over the years with poverty and unemployment topping the list. As of 2014, 13.62 percent of the Pennsylvanian population lived below the poverty line. Unemployment rates have continued to decline over the years with the latest statistics from the department of labor reporting a 5.2 unemployment rate in the state. Within the state, poverty and unemployment levels vary widely across cities with Pittsburgh being amongst the worst hit.
Poverty, Unemployment and Socioeconomic status in Pittsburgh
Pittsburgh is the second largest city in Pennsylvania with a population of 304,391 residents. About 22.9 of this population lives below the poverty line. At $40,715, median household income in Pittsburgh is 28 percent lower than the state’s average and 30 percent lower than the nation’s median household income. The city has an unemployment rate of 6.5 percent, a significant improvement from 7.7 percent in 2012. Pittsburgh unemployment and poverty levels continue to display dismay numbers despite a steady performance of the city’s major industries. This trend can be attributed to a decline in the city’s population levels and numerous economic recessions faced by many cities in the United States.
Despite the fact that the city unemployment levels were below the national average, income disparity is rampant in Pittsburgh. This is due to the fact that racial minorities — African-Americans and Hispanics — in the city have the highest unemployment and poverty levels. Pittsburgh is among the metropolitan regions with the highest unemployment rates for minorities in the United States. As of 2011, the rate of unemployment among the city’s African-American population was at around 19 percent. This means that one out of every five African-American people in Pittsburgh willing and able to work couldn’t find a job, and those who were lucky enough to find a job earned a meager income.
Many low-income Pittsburgh residents have been going through a rough patch financially due to a combination of the above factors and the great economic recession in the country. As a result, a significant portion of this populace is struggling with the tremendous amount of unsecured debt in the form of credit card loans, medical bills, and personal loans. There has been an increase in the number of companies offering debt relief services such as debt settlement for eligible persons mitigate this situation.
What Is Debt Settlement?
Debt settlement is a debt relief process where a creditor accepts a payment less than the amount owed and forgive the rest. The debtor is allowed to pay a certain percentage of the debt in a onetime payment or spread the payment in a given period, say six months installments. Debt settlement is a good option for people with massive financial problems and on the verge of bankruptcy. Due to the high incidences of debt settlement scams in the United States, debt settlement is not popular, and many government organizations don’t encourage people in debt to use debt settlement as a method of debt relief. Other debt relief resources in the city of Pittsburgh include debt consolidation, credit counseling, and debt management options.
How Debt Settlement Works
If you have legitimate debt problems and on the verge of filing for Chapter 13 bankruptcy, debt settlement could be a viable option for you. There are two approaches towards debt settlement: you can directly approach your creditors and discuss your options vis-à-vis debt settlement, or you can use a debt settlement company where the company will negotiate on your behalf. In both cases, the goal is to convince the creditors to accept the least possible amount. After they accept your offer, you can either pay the agreed amount in a single payment or pay it in installments over a given period. Before you choose a debt settlement company, check their rating and accreditation with Better Business Bureau to avoid being a victim of debt settlement scams.
Benefits of Debt Settlement in Pittsburgh
There are several advantages of debt settlement over filing for bankruptcy. Besides being able to pay your debts in a short period, you will avoid adverse impacts of bankruptcy on your creditworthiness. Though debt settlement will have a negative effect on your credit rating too, it’s easier to come back from that compared to bankruptcy.
Debt Relief Laws in Pennsylvania
Debt relief in Pennsylvania is governed by a set of laws under Fair Debt Collection Practices Act (FDCPA). Under the FDCPA:
- It’s unlawful for a collection agency to use deceptive or unfair collection practices including unauthorized charges or interest rates.
- The collection agency cannot coerce or intimidate the debtor using legal threats.
- A collection agency is prohibited from directly or indirectly, furnishing legal services in or outside the Commonwealth.
- A collection agency is prohibited from representing or appearing as the creditor.