Latest news with #ConsumerDebt
Yahoo
a day ago
- Business
- Yahoo
New Data: Consumer Debt Crisis Drives Legal Stress to 5-Year High
- Foreclosure inquiries rise nearly 30% year-over-year as Americans struggle to stay afloat - Personal Finance questions up almost 9% over first quarter - LegalShield Consumer Stress Legal Index highest since November 2020 ADA, Okla., July 14, 2025--(BUSINESS WIRE)--Foreclosure legal inquiries jumped nearly 30% year-over-year in the second quarter as mounting consumer debt pushed Americans to seek legal help at the highest rate since November 2020, according to new data that offers an early warning sign of household financial stress ahead of the next Federal Reserve debt report. LegalShield's Consumer Stress Legal Index (CSLI) climbed 4.4% from March to June, driven by surging foreclosure and consumer finance legal inquiries, all rooted in increased debt. "Debt is the common thread behind rising consumer stress," said Matt Layton, senior vice president of consumer analytics at LegalShield. "Whether it's missed mortgage payments, maxed-out credit cards, or mounting buy-now-pay-later balances, debt-fueled household spending is forcing people to ask a lawyer for help." Data analysis shows the Foreclosure Index jumped 13.3% during the quarter and is now nearly 28.9% higher than a year ago, marking the steepest annual increase in three years. The Consumer Finance Index also climbed 8.7% since March, as more consumers sought legal assistance for debt-related issues such as defaults and loan modifications. Americans in Debt LegalShield's CSLI report comes ahead of the Federal Reserve Bank of New York's scheduled release of second quarter household debt numbers in early August. Household debt has steadily increased since 2013 following a period of decline after the 2008 recession. Household debt balances stood at a record $18.20 trillion in Q1 2025, a 0.9% rise from the end of 2024. In particular, mortgage balances grew by $199 billion and home equity lines of credit (HELOC) increased by $6 billion. More concerning is that overall debt delinquencies increased to 4.3% at the end of Q1, the highest level since 2020, including rising delinquencies for mortgages and HELOCs, as well as student loans that began reporting to credit agencies in Q1 following a nearly five-year pause due to the pandemic. "LegalShield data tends to move ahead of official reports, and right now, it's signaling deeper trouble," said Layton. "In the coming weeks, we expect the next debt and foreclosure reports to reflect what calls to our provider lawyers are seeing — more households slipping into unsustainable financial territory." Consumers Take Action LegalShield data tracks actions taken by consumers with more than 150,000 calls to provider lawyers each month. The LegalShield dataset is built on hard data based on American households' real-time legal needs that reflect financial pressures and opportunities. This stands in contrast with polling based on opinion and sentiment. The latest rise in consumer stress reveals sharp increases in foreclosure and consumer finance inquiries, and those findings suggest that more Americans are struggling with debt, housing costs, and financial obligations, even as overall spending remains strong; the latest Personal Consumption Expenditures (PCE) data shows consumer spending is up 6.9% year over year in May. Key Research Findings: Consumer Stress Legal Index (CSLI) Highest in More Than 5 Years CSLI: 68.2 (up from 65.3 in March; up from 61.8 YoY) +4.4% quarter-over-quarter | +10.4% year-over-year The CSLI has increased four straight months, signaling intensifying economic stress for consumers despite a resilient stock market and stable employment figures. Foreclosure Spike Signals Growing Housing Strain Foreclosure Index: 46.8 (up from 41.3 in March; up from 36.3 YoY) +13.3% quarter-over-quarter | +28.9% year-over-year Rising insurance premiums, property tax reassessments, and adjustable-rate mortgage resets are pressuring homeowners. LegalShield's Foreclosure Index closely tracks foreclosure filings nationally. Rising Debt Fuels Surge in Consumer Finance Legal Issues Consumer Finance Index: 106.4 (up from 97.9 in March; up from 101.7 YoY) +8.7% quarter-over-quarter | +4.6% year-over-year Consumers are increasingly seeking legal assistance for a wide range of financial issues with a steep rise in the index in the second quarter. Analysis of the data indicates households are feeling the effects of delinquent debt, sustained interest rates and persistent inflation on everyday essentials. Bankruptcy Dips in Q2 But Remains Elevated YoY Index: 32.1 (down from 36.4 in March; up from 29.5 YoY) –11.8% quarter-over-quarter | +8.8% year-over-year Bankruptcy inquiries eased in the short term but remain significantly elevated compared to last year. The dip may reflect temporary stabilization due to seasonal factors, but high debt levels and consumer delinquencies still loom. Study Methodology LegalShield tracks an average of 150,000 monthly calls to provider lawyers based on more than 90 areas of law. That data comprises more than 35 million consumer requests for legal services dating to 2002. The CSLI is the flagship index reporting consumer stress, based on three subindices: Bankruptcy, Consumer Finance, and Foreclosure. About the Research: LegalShield Consumer Stress Legal Index As part of LegalShield's mission to ensure every person has equal access to justice, the company mines its data for insights policymakers can use to make a real, positive impact in their decision making. The LegalShield Consumer Stress Legal Index comprises three subindices that reflect the demand for various legal services. LegalShield's dataset includes more than 35 million consumer requests for legal assistance since 2002, averaging approximately 150,000 calls received monthly. The CSLI uncovers the daily challenges people are facing and provides actionable intelligence to help policymakers and industry leaders bridge those gaps. Released quarterly, view past reports on the CSLI page on About LegalShield: For more than 50 years, LegalShield has provided everyday Americans with easy and affordable access to legal advice, counsel, protection, and representation. Serving millions, LegalShield is one of the world's largest platforms for legal, identity, and reputation management services protecting individuals and businesses across North America. Founded in 1972, LegalShield, and its privacy management product, IDShield, has provided individuals, families, businesses, and employers with tools and services needed to affordably live a just and secure life. Through technology and innovation, LegalShield is disrupting the traditional legal system and transforming how and where people receive legal guidance and services, with access to hundreds of qualified, trusted attorneys and law firms. LegalShield and IDShield are products of Pre-Paid Legal Services, Inc. To learn more about LegalShield and IDShield, visit and View source version on Contacts LegalShield Media Contact: Hollon Kohtz, Director of Communicationshollonkohtz@ Sign in to access your portfolio
National Post
a day ago
- Business
- National Post
New Data: Consumer Debt Crisis Drives Legal Stress to 5-Year High
Article content – Foreclosure inquiries rise nearly 30% year-over-year as Americans struggle to stay afloat – Personal Finance questions up almost 9% over first quarter – LegalShield Consumer Stress Legal Index highest since November 2020 ADA, Okla. — Foreclosure legal inquiries jumped nearly 30% year-over-year in the second quarter as mounting consumer debt pushed Americans to seek legal help at the highest rate since November 2020, according to new data that offers an early warning sign of household financial stress ahead of the next Federal Reserve debt report. Article content Article content LegalShield's Consumer Stress Legal Index (CSLI) climbed 4.4% from March to June, driven by surging foreclosure and consumer finance legal inquiries, all rooted in increased debt. 'Debt is the common thread behind rising consumer stress,' said Matt Layton, senior vice president of consumer analytics at LegalShield. 'Whether it's missed mortgage payments, maxed-out credit cards, or mounting buy-now-pay-later balances, debt-fueled household spending is forcing people to ask a lawyer for help.' Article content Data analysis shows the Foreclosure Index jumped 13.3% during the quarter and is now nearly 28.9% higher than a year ago, marking the steepest annual increase in three years. The Consumer Finance Index also climbed 8.7% since March, as more consumers sought legal assistance for debt-related issues such as defaults and loan modifications. Article content Americans in Debt Article content LegalShield's CSLI report comes ahead of the Federal Reserve Bank of New York's scheduled release of second quarter household debt numbers in early August. Household debt has steadily increased since 2013 following a period of decline after the 2008 recession. Household debt balances stood at a record $18.20 trillion in Q1 2025, a 0.9% rise from the end of 2024. In particular, mortgage balances grew by $199 billion and home equity lines of credit (HELOC) increased by $6 billion. More concerning is that overall debt delinquencies increased to 4.3% at the end of Q1, the highest level since 2020, including rising delinquencies for mortgages and HELOCs, as well as student loans that began reporting to credit agencies in Q1 following a nearly five-year pause due to the pandemic. Article content 'LegalShield data tends to move ahead of official reports, and right now, it's signaling deeper trouble,' said Layton. 'In the coming weeks, we expect the next debt and foreclosure reports to reflect what calls to our provider lawyers are seeing — more households slipping into unsustainable financial territory.' Article content Consumers Take Action Article content LegalShield data tracks actions taken by consumers with more than 150,000 calls to provider lawyers each month. The LegalShield dataset is built on hard data based on American households' real-time legal needs that reflect financial pressures and opportunities. This stands in contrast with polling based on opinion and sentiment. The latest rise in consumer stress reveals sharp increases in foreclosure and consumer finance inquiries, and those findings suggest that more Americans are struggling with debt, housing costs, and financial obligations, even as overall spending remains strong; the latest Personal Consumption Expenditures (PCE) data shows consumer spending is up 6.9% year over year in May. Article content Key Research Findings: Article content The CSLI has increased four straight months, signaling intensifying economic stress for consumers despite a resilient stock market and stable employment figures. Article content Foreclosure Spike Signals Growing Housing Strain Article content +13.3% quarter-over-quarter | +28.9% year-over-year Article content Rising insurance premiums, property tax reassessments, and adjustable-rate mortgage resets are pressuring homeowners. LegalShield's Foreclosure Index closely tracks foreclosure filings nationally. Article content Rising Debt Fuels Surge in Consumer Finance Legal Issues Article content +8.7% quarter-over-quarter | +4.6% year-over-year Article content Consumers are increasingly seeking legal assistance for a wide range of financial issues with a steep rise in the index in the second quarter. Analysis of the data indicates households are feeling the effects of delinquent debt, sustained interest rates and persistent inflation on everyday essentials. Article content Bankruptcy Dips in Q2 But Remains Elevated YoY Article content Bankruptcy inquiries eased in the short term but remain significantly elevated compared to last year. The dip may reflect temporary stabilization due to seasonal factors, but high debt levels and consumer delinquencies still loom. Article content Study Methodology Article content LegalShield tracks an average of 150,000 monthly calls to provider lawyers based on more than 90 areas of law. That data comprises more than 35 million consumer requests for legal services dating to 2002. The CSLI is the flagship index reporting consumer stress, based on three subindices: Bankruptcy, Consumer Finance, and Foreclosure. Article content As part of LegalShield's mission to ensure every person has equal access to justice, the company mines its data for insights policymakers can use to make a real, positive impact in their decision making. The LegalShield Consumer Stress Legal Index comprises three subindices that reflect the demand for various legal services. LegalShield's dataset includes more than 35 million consumer requests for legal assistance since 2002, averaging approximately 150,000 calls received monthly. The CSLI uncovers the daily challenges people are facing and provides actionable intelligence to help policymakers and industry leaders bridge those gaps. Released quarterly, view past reports on the CSLI page on Article content About LegalShield: Article content For more than 50 years, LegalShield has provided everyday Americans with easy and affordable access to legal advice, counsel, protection, and representation. Serving millions, LegalShield is one of the world's largest platforms for legal, identity, and reputation management services protecting individuals and businesses across North America. Founded in 1972, LegalShield, and its privacy management product, IDShield, has provided individuals, families, businesses, and employers with tools and services needed to affordably live a just and secure life. Through technology and innovation, LegalShield is disrupting the traditional legal system and transforming how and where people receive legal guidance and services, with access to hundreds of qualified, trusted attorneys and law firms. LegalShield and IDShield are products of Pre-Paid Legal Services, Inc. To learn more about LegalShield and IDShield, visit and Article content Article content Article content Article content Article content
Forbes
04-07-2025
- Business
- Forbes
This Lazy Take On US Debt Could Cause You To Miss A 14% Dividend
United States fifty dollar bill with the United States Capitol building close up Well, that didn't last long. A few months ago, all we heard from the mainstream media is that the 'sell America' trend was going to stick around for a long time. Nowadays, we're still hearing that. But one corner of the market—closed-end funds (CEFs)—is telling us something interesting: That investors are starting to turn their attention back to the US. That's given us an opportunity to front-run this quiet shift now, while it's still early, with some high-yield CEFs trading at attractive discounts. In a second, I'll walk you through the signal we're getting from two of the biggest US-focused CEFs—one holding stocks, the other corporate bonds. First, though, let's talk about what the real data says about one of the biggest fears that's been driving the so-called 'sell America' theme—US debt. US Debt Ratio Current This chart shows how much US households pay to manage their debt, as a percentage of disposable income. It's the main evidence supporting the argument that fears about US economic stability are warranted. To be fair, this chart does show a jump—about 10% in the last three years. In other words, yes, Americans' debt costs are higher than they were in 2022. That's a sure sign the US consumer is tapped out, right? If this all sounds familiar, it's because it's the same story the press pushed in 2022, with headlines like 'Consumer Debt Surges at Fastest Pace in 15 Years.' Three years later, the US economy remains strong. So maybe it's going to finally falter now? That's what the Wall Street Journal has been saying. In March, it published a story titled, 'Consumers Keep Bailing Out the Economy. Now They Might Be Maxed Out,' and another headlined: 'Recession Fears Stoke Concerns Americans Are Overstretched.' Now let's look at a chart that starts to dispel this fear and tell us the real story here. US Debt Ratio Historic Household debt payments definitely rose from their all-time low in 2021. Now they've leveled off at around 5.5% of disposable income. That's about where they were in the early 2010s. Today's level is also far below the average in the 1980s, 1990s and 2000s. US Debt Not The Problem… In other words, Americans are not maxed out. In fact, their household-debt levels are quite low. According to IMF data, US households are less indebted than those in much of Europe and Asia, as well as Australia and Canada, both of which are places thought to be fiscally responsible. Household Debt, Global At current levels of American disposable income (which is among the highest in the world) and debt levels (one of the lowest), the average US household is paying about $282 per month on its debt. That's hardly a lot of money for most people! It's also worth pointing out that the average American family's net worth had risen to $192,700 by 2022 (when the Federal Reserve did its latest survey), fully recovering from the Great Recession. There's a direct line between this financial improvement and the S&P 500's world-beating long-term performance: SPY Total Returns Which brings me back to that indication CEFs are giving us that investors may finally be catching on to the strength of the US consumer. To get at that, let's look at a major corporate-bond CEF, the PIMCO Dynamic Income Fund (PDI), and the Nuveen S&P 500 Dynamic Overwrite Fund (SPXX). As SPXX's name says, it holds the S&P 500, but it also sells call options—a low-risk way to support its dividend. In a June 9 article on our Contrarian Outlook website, we talked about how SPXX and PDI work together to give an investor a nicely diversified 'mini-portfolio' of stocks and bonds. We also identified an international fund, the Clough Global Opportunities Fund (GLO), as a less-effective way to diversify. With CEFs, we have two measures of performance: total return based on net asset value (NAV, or the value of a fund's underlying portfolio) and total return based on market price. These can be different, with NAV a better measure of the fund's portfolio management and market price a measure of the fund's overall performance, subject to investor whim. When we look at the total NAV returns of the US-focused funds in the past year (SPXX, in orange below, and PDI, in blue), we see that they exceed that of the more global fund, GLO (in purple), by a fair margin: US Outperforms But if we pivot away from NAV for a moment and look at GLO's total price return, we see that the global fund, GLO, has a far better performance, returning 15% (in orange below), far higher than the 6.4% return on its NAV (in purple) and indeed ahead of SPXX. GLO Total Returns Here's what's really happening: Market demand for this fund is outpacing the fundamentals by a lot. That's causing GLO's discount to NAV to narrow (it's now 11.7%). Over time, investors will likely realize that fundamentals are underperforming market demand here and that, when compared to SPXX's 7.6% yield and PDI's 14% payout, both funds are better contenders than GLO to deliver strong total returns alongside a rotation back into America. And that means there's still time to profit from these two funds and avoid the growing possibility of underperforming by holding GLO, as that fund's market-price gains run ahead of its fundamentals, potentially setting it up for a fall. In short, the 'pivot back to America' trade is wide open in CEF-land, where big (and often monthly paid) dividends are also on the table—if you stick to the data and ignore media fearmongering. Michael Foster is the Lead Research Analyst for Contrarian Outlook. For more great income ideas, click here for our latest report 'Indestructible Income: 5 Bargain Funds with Steady 10% Dividends.' Disclosure: none
