The color of debt

Marketplace Contributor Oct 8, 2015

The color of debt

Marketplace Contributor Oct 8, 2015

Tracey Samuelson’s story (listen above) was co-produced with ProPublica.


On a recent Saturday afternoon, the mayor of Jennings, a St. Louis suburb of about 15,000, settled in before a computer in the empty city council chambers. Yolonda Fountain Henderson, 50, was elected last spring as the city’s first black mayor.

The City Council chambers of Jennings, Missouri. In addition to the mayor, five of the eight sitting city council members have been sued over a debt. (Edwin Torres/ProPublica)

On the screen was a list of every debt collection lawsuit against a resident of her city, at least 4,500 in just five years. Henderson asked to see her own street. On her block of 16 modest ranch-style homes, lawsuits had been filed against the occupants of eight. “That’s my neighbor across the street,” she said, pointing to one line on the screen.

And then she saw her own suit. Henderson, a single mother, fell behind on her sewer bill after losing her job a few years ago, and the utility successfully sued her. That judgment was listed, as well as how one day the company seized $382 from her credit union account — all she had, but not enough to pay off the debt.

Children play at a block party in Jennings, a suburb in north St. Louis County.

Children play at a block party in Jennings, a suburb in north St. Louis County.  (Edwin Torres/ProPublica)

As the lines of suits scrolled by on the screen, Henderson shook her head in disbelief, swinging her dangling, heart-shaped earrings.

“They’re just suing all of us,” she said.

That’s not only true in Jennings. The story is the same down the road in Normandy and in every other black community nearby. In fact, when ProPublica attempted to measure, for the first time, the prevalence of judgments stemming from these suits, a clear pattern emerged: they were massed in black neighborhoods.

Sylvester and Gladys Clayborn sit in their kitchen as their granddaughters and great niece play nearby. The couple fell into debt when Gladys was permanently disabled after heart surgery. (Edwin Torres/ProPublica)

The disparity was not merely because black families earn less than white families. Our analysis of five years of court judgments from three metropolitan areas — St. Louis, Chicago and Newark — showed that even accounting for income, the rate of judgments was twice as high in mostly black neighborhoods as it was in mostly white ones.

Rosalyn Turner stands on the doorstep of her home in Jennings. Turner was sued over an unpaid sewer bill that was her landlord’s responsibility and an unpaid car loan she took out ten years prior. “It’s hard not to go crazy and stress out, you know,” she said. (Dan Gill for ProPublica)

These findings could suggest racial bias by lenders or collectors. But we found that there is another explanation: That generations of discrimination have left black families with grossly fewer resources to draw on when they come under financial pressure.

Since 2012, Cori Winfield has had her wages garnished over an unpaid car loan. Because the debt continues to run at an annual interest rate of 30 percent, she has already paid more than twice of what she owed when the car was repossessed in 2010. (Edwin Torres/ProPublica)

Over the past year, ProPublica has investigated a little-known but pervasive shift in the way debt is collected in America: Companies now routinely use the courts to pursue millions of people over even small consumer debts. With the power granted by a court judgment, collectors can seize a chunk of a debtor’s pay. The highest rates of garnishment are among workers who earn between $25,000 and $40,000, but the numbers are nearly as high for those who earn even less.

Despite their prevalence, these suits remain remarkably hidden, even to people in the communities most burdened by them.

You can read ProPublica’s full investigation here. 

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