As a Spanish-speaking bankruptcy attorney in Chicago, I encounter many immigrant clients who are in debt and need help managing their finances.

Many times, these clients do not understand some of the contracts they signed with their landlords, mortgage companies, and car lenders. Some of the worst car loans I have ever encountered have been high-interest loans with many miscellaneous charges that the client does not understand. I constantly come across clients who finance vehicles at 25% interest rates with monthly payments in excess of $600.

While people do understand that they will have a difficult time making their monthly payments, the justification for entering into these types of loans is that they needed the vehicle to go to work and that nobody else would give them a loan.

People living in poverty are constantly in such a bind that they feel that they have no other
choice but to take on high-interest debt to survive. When faced with an impending eviction,
taking a title loan out on your only family car might be the only choice you have.

There was a survey from Bankrate that came out in early 2022 that found that more than half of Americans cannot afford a $1,000.00 emergency. The study reinforced what I already knew from reviewing my clients’ finances.

A typical move from one apartment to another can easily cost $2,000.00. Most landlords require high-security deposits from low-income renters with poor credit, so even renting an $800.00 a month apartment might require putting down a $1,6000.00 security deposit. Add to that a few hundred dollars in moving costs, and it can easily cost a family
$2,000.00 to move.

For many of my clients, they have no choice but to take out a high-interest loan to cover this cost. Most of us have heard the saying that it takes money to make money. Relatedly it seems that poor people tend to make many poor financial decisions- usually out of

Thankfully there are some programs in our city that provide assistance with rent costs, utilities, and food. But there are many people who cannot take advantage of this help or may not know how to access these resources. Many immigrants who are undocumented do not qualify for certain government assistance programs such as SNAP (food assistance), Social Security, and most recently, stipends from the Federal CARES Act for Covid relief.

So, immigrant families are many times put in a bind when they find out they are not eligible for certain benefits. Being in a stressful situation where you do not have enough money to pay for basic living expenses can cause people to make seemingly bad financial decisions like taking out high-interest loans. Complicating the matter, many times, federal bankruptcy relief is not available to people who are undocumented for fear of declaring their undocumented state to the government in the form of a bankruptcy petition. While you can file for bankruptcy by using an ITIN, it can be risky to file if you have been using a different social security number to work or obtain credit. The cost of filing for bankruptcy can also be cost-prohibitive to some families who barely make enough to survive.

Bringing awareness to the unique financial struggles of immigrant families is important. Refugee programs at both the city and state levels exist but are underfunded and need volunteers to survive. There are many opportunities to help assist newly arrived migrants in our city. The Illinois Department of Human Services has a list of community agencies on their website where you can volunteer.

Many times, refugees arriving need basic living items such as beds, clothes, and kitchenware. Most recently, in the beginning of September, the governor of Texas bussed
approximately 75 migrants to Chicago. Local organizations such as Erie Neighborhood House and CommunityHealth have already posted volunteer opportunities on their websites.

The most important thing we can do is support these families that may be staying in Chicago for the long term so that we can try to break the cycle of poverty and help our fellow people get ahead.

Cover Photo by Towfiqu barbhuiya on Unsplash

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