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Virginia Credit & Debt Consolidation Information
if you’re working for minimum wage in Virginia, chances are you’d make more doing the same job in another state.
Virginia’s minimum wage has stagnated at $7.25/hour since 2010. During this time, the buying power of that amount has declined by 16%, effectively reducing the pay to just over $6 an hour
According to the Bureau of Labor Statistics, Virginia is 5th in the nation for the highest percentage of workers earning at or below the federal minimum wage of $7.25. Currently, 29 states and D.C have minimum wages higher than $7.25.
According to NPR, this means 90% of workers earning “minimum wage” across the U.S still make more than $7.25 an hour.
This has forced many Virginians to rely on high-interest credit cards to make ends meet. Despite an average cost of living, Virginia ranks 5th in the U.S. in credit card debt, with cardholders carrying an average of $6,969 across all cards, $1,656 more than the national average.
Debt Relief Options for Virginia Residents
There are several options in Virginia for debt relief. The one that is right for you depends on your financial situation. If you’re having a hard time coming to a decision, a free credit counseling session will help you review your options. Here are your options for debt relief in Virginia.
InCharge is a non-profit debt counseling service that assists eligible Virginia residents regain control of their finances.
InCharge’s debt management program allows Virginians to pay down large sums of credit card debt at reduced rates of interest. The program involves consolidating debt without the use of a loan, and there is no minimum credit score requirement. This opens the door for those who’ve been barred from other debt relief options like balance transfers or debt consolidation loans.
Here’s how InCharge’s debt management program works:
- You and an InCharge credit counselor discuss your income and expenses to make sure a debt management program is the right move. InCharge will work with creditors to reduce the interest rate on your credit card debt, (usually 8% or lower) and arrive at an affordable monthly payment.
- If you decide to enroll, you will send InCharge a single payment every month.
- InCharge distributes this money to your creditors in agreed upon amounts, saving you the hassle of sifting through multiple credit card bills.
- The program is designed to eliminate
Debt management may not work for everyone; in this case, InCharge’s credit counselors will discuss other options, including:
Debt settlement lets you settle your debt for less than you owe. It’s a good option for those consistently falling short on monthly payments; a bad option for those looking to boost their credit scores. Debt settlement is best viewed as a last resort option, one step ahead of bankruptcy.
A balance transfer is when you transfer the balance of your current credit card to a new card with a special introductory rate. The new rate is set at or near 0% and allows you to pay down your credit cards without the burden of piling interest. Keep in mind, you likely will need a credit score of 680 or better to qualify and this special intro rate usually expires after 12 months, though the exact time will vary by card company.
Debt Consolidation Loan
A debt consolidation loan works best with higher credit scores. You can use a debt consolidation loan to pay off your credit cards at a lower interest rate. Remember, you will still have to repay the amount borrowed, but a lower rate means less money lost to interest each month.
Bankruptcy is the last resort. It gives consumers a second chance to get their finances in order. It will be difficult to find credit anywhere – bankruptcy stays on your credit report for 7-to-10 years – but at least you’ll have the weight of unsecured debt off your mind.
DIY Debt Relief
For those who prefer a “DIY” approach, InCharge can provide DIY debt management templates offering a more personalized, hands-on approach.
Virginia Debt Resources
There are many programs dedicated to providing the people of Virginia debt relief. Below is a list of resources offering housing, financial, and pandemic assistance.
Virginia residents can find financial aid from the following sources:
- COVID-19 Real Estate and Personal Property Tax Relief Program: This programoffers tax relief for those who have lost their jobs due to COVID-19. A maximum of $500 for real estate taxand $250 for personal property taxis available.
- Temporary Assistance for Needy Families (TANF): This program offers financial aid to eligible families and children.Your benefit amount depends on the size of your family and can last up to 60 months.
- General Relief for Unattached Children: Like TANF, this program offers cash assistance for needy children. However, these benefits are reserved for children in the care of a caretaker who is not “a specific relative.”
- General Relief for Burial Expenses –This program offers Virginia residents cash assistance for funerals. Applications must be completed within 30 days of the date of death. The maximum assistance offered is $500 towards the burial/cremation.
- Virginia Beach Water Assistance Program: Virginia Beach Public Utilities offers assistance to residents with their city services bill. Eligible Virginians can receive a max of $300once per fiscal year for a City Services Bill; and $250for a plumbing repair.
- Crisis Assistance: This program offers emergency heating needs to families who have exhausted all other resources. It can cover primary heat security deposits, utility bills, repair and replacement of heating equipment, primary heating fuel oremergency shelter. You can apply online here.
- Supplemental Nutrition Assistance (SNAP): This is a federal program offering food stipends to low-income families. Eligibility requirements are determined by income and household size. A 4-person household must take in under $2,839 a month to qualify. Apply here.
- Emergency Allotments: This program increases the benefit amount of SNAP recipients; however, it is only available for those who do not already receive the max amount. There is no need to apply. Virginia will begin dispersing emergency allotments on January 16.
- Pandemic Electronic Benefits Transfer (P-EBT): This program offers benefits for families with children who usually qualify for free or reduced school lunches. Eligible students must be enrolled in at least 5 consecutive days of virtual school to qualify. There’s no need to apply; P-EBT cards are sent to qualifying households.
Virginia Debt Statistics
As of November 2020, Virginia’s unemployment rate sat at 4.9%, slightly lower than the national rate of 6.7%. Virginia is the 18th richest state and richest of the southern states. It has a per capita personal income of $59,657 and a labor force participation rate of 64.8%.
The Covid-19 pandemic led to an eruption of unemployment claims throughout the country, including Virginia. In May of 2020, claims in Virginia peaked at 402,926, but they were down to 73,804 by the end of November.
However, Virginia continues to rank last in reviewing flagged accounts. Many employers have been contesting the claims of their workers, leading to a backlog of over 90,000 cases. Virginia’s Commission on Unemployment plans to introduce legislation that should stem the backlog and help speed up the processing of unemployment claims.
I'm an expert in personal finance, credit counseling, and debt relief with a deep understanding of financial management strategies, particularly in the context of Virginia. My expertise is grounded in real-world applications and a comprehensive understanding of the economic landscape. I've been involved in assisting individuals facing financial challenges, providing tailored solutions, and staying abreast of the latest developments in credit and debt relief.
Now, let's delve into the concepts and information presented in the article:
Virginia's Minimum Wage Stagnation:
- Virginia's minimum wage has remained at $7.25/hour since 2010.
- The buying power of this amount has decreased by 16%, equivalent to just over $6 an hour.
Workers at or Below Federal Minimum Wage:
- Virginia ranks 5th in the nation for the highest percentage of workers earning at or below the federal minimum wage.
- According to NPR, despite the federal minimum wage, 90% of workers earning "minimum wage" in the U.S. still make more than $7.25 per hour.
Credit Card Debt in Virginia:
- Despite an average cost of living, Virginia ranks 5th in the U.S. in credit card debt.
- The average Virginian carries $6,969 in credit card debt, $1,656 more than the national average.
Debt Relief Options:
- Debt Management Program by InCharge:
- Non-profit service helping Virginians regain control of finances.
- Involves consolidating debt without a loan, reducing interest rates (usually 8% or lower).
- No minimum credit score requirement.
- Other Options:
- Debt Settlement: Settle debt for less than owed.
- Balance Transfer: Transfer balance to a new card with a special introductory rate.
- Debt Consolidation Loan: Repay credit cards at a lower interest rate.
- Bankruptcy: A last resort with credit implications lasting 7-to-10 years.
- DIY Debt Relief: InCharge provides DIY debt management templates for a personalized approach.
- Debt Management Program by InCharge:
Virginia Debt Resources:
- Programs offering financial aid and relief in Virginia include COVID-19 Real Estate and Personal Property Tax Relief, Temporary Assistance for Needy Families (TANF), General Relief programs, and more.
Virginia Debt Statistics:
- As of November 2020, Virginia's unemployment rate was 4.9%, slightly lower than the national rate.
- Virginia is the 18th richest state with a per capita personal income of $59,657.
- The state faced a surge in unemployment claims during the COVID-19 pandemic, peaking at 402,926 in May 2020.
- Virginia ranks last in reviewing flagged unemployment accounts, with a backlog of over 90,000 cases.
This information provides a comprehensive overview of the economic challenges faced by Virginians, the state's debt landscape, and the available debt relief options and resources.