SEATTLE - A new report says debt collection is pushing families into poverty and needs reform in every state.
The National Consumer Law Center released a review of state exemption laws - that is, protections from seizure by creditors for basic items so that people can continue to work and support their families.
Overall, the report gives Washington state a 'C' grade.
Jay Doran, policy and field campaign manager for the Statewide Poverty Action Network, says Washington's rising cost of living and stagnant wages mean more folks are living paycheck to paycheck.
He says one major injury or illness, for instance, could push them over the edge.
"We're not advocating that people shouldn't pay their debts," he stresses. "What we're saying is, people shouldn't be rendered homeless, they shouldn't be rendered jobless, they shouldn't be destabilized in a way that's going to be detrimental for their family, for themselves and for our greater community at the expense of these debts."
Grades were based on state laws in five areas: protection of a living wage, one's home, car, household goods and a basic amount in their bank account.
The National Consumer Law Center did not give any state an 'A' grade.
Doran says the Evergreen State needs to work on creative solutions so people can still meet their basic needs while responsibly paying their debts back.
He credits Washington state lawmakers for passing consumer protections in their recent session. One bill increased the amount of money protected in a person's bank account from $500 to $2,000.
"So a pretty significant increase and one in which we can reasonably say in most parts of our state, if someone had $2,000 in their bank account, that's likely enough for them to pay rent for at least one more month," he points out.
Doran says lawmakers also passed a bill increasing protections from wage garnishment. He adds there still is more the state can do for consumers.
The report offers recommendations for states, including protecting retirees from having their retirement funds seized.