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justice through code

Code for Progress is a non-profit organization tackling issues at the intersection of technology and social justice. Historically, Code for Progress has engaged people of color and women in the coding workforce through holistic investment in their technical training and communities of support. Currently, Code for Progress alumni are applying their technical expertise to counter the weaponization of the court systems by industrialized debt aggregators.

debt isn't a weapon

We believe that people do not incur debt frivolously and that most people want, and try, to repay what they owe. Systemic factors, including the lack of a social safety net for necessities, such as housing, food, and medical care, cause people to rely on credit or otherwise accumulate debt simply to live. We believe the predatory practices of charging exorbitant interest and unjust fees, endlessly harassing debtors, and corrupting the legal system to wage economic warfare are wrong. We seek to empower impacted individuals to take a stand against the lawsuit factories that profit off these inequities.

industrialized debt litigation

Consumer debt is an overwhelming problem facing many Americans. Credit card and medical debts currently account for over $1 trillion of Americans’ total of $16 trillion of household debt - and at least $88 billion of medical debt is currently in collections proceedings. These consumer debts weigh disproportionately heavily on low-income households and communities of color.
When creditors are unable to collect, they often sell the asset to private, third-party debt aggregators for pennies on the dollar, taking the write-off and washing their hands of the matter. A small handful of companies snatch up the majority of these debts, to feed an assembly line legal filing process built to enlist the courts. These aggregators are behemoths, using massive nationwide scale to turn low-dollar debts into immense profits.
When debt aggregators push these cases into the court system, they (quite literally) bank on under-resourced, untrained, and intimidated defendants taking no action. Unsurprisingly, around 70% of defendants fail to respond in any way to these lawsuits, leading to default judgments - absolving debt collection plaintiffs from having to prove their case.
The sheer volume of debt lawsuits, coupled with the high default judgment rate (and the accompanying interest, attorneys’ fees, and filing fees a default judgment entitles them to recoup), add up to a highly profitable enterprise - and predictably, debt collection lawsuits have risen to account for 24% of state court dockets.
As an indication of the predatory nature of these debt aggregators, and the economics of their abuse of the court systems, almost 70% of the cases in which the defendant submits a response, are simply dropped by the debt aggregators and their teams of attorneys. They are uninterested in waste their time fighting someone who is willing to defend themselves, and will instead focus their atention on other cases, where they hope to abuse and bully, unopposed, through the courts.

kick scummy aggregators in the teeth

Code for Progress scans court docket systems to identify the victims of suits filed by the largest and most exploitative plaintiffs. We then attempt to make contact, using mail, phone, and text messaging, to ensure that the defendants know their rights and to empower them to respond. These communications inform defendants of the deadline to respond and direct them to local pro-bono legal aid organizations or other resources that will assist them in crafting a response to the complaint.

resources stay in communities

Our testing has shown that if a defendant is contacted and given the knowledge and tools to respond, there is a 32% increase in complaint responses. This increased response rate means instead of lining debt aggregator's pockets these resources stay in the community. An increase in challenges to these preditroy debt collection lawsuit also helps to narrow the profits of these mega-litigants, reducing the capital they can use to go after others.
On an individual level, in 70% of cases, if a response is filed the lawsuit is dropped - because the underlying economics of pursuing the case do not favor the debt aggregators. This means that each household affected by the case is no longer burdened by that debt. Even if the case is not immediately dropped, it gives the defendant an opportunity to engage in negotiations to reduce the amount owed to a level that is feasible for their income.
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Philadelphia, PA 19147
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