http://www.responsiblelending.org feed-51155113 web@responsiblelending.org 2010 Center for Responsible Lending Convio Content Management System Module en-us http://www.responsiblelending.org/styles/images/crl-logotag.jpg http://www.responsiblelending.org www.responsiblelending.org-338309070 http://feedproxy.google.com/~r/CrlHeadlines/~3/JJx-ETPIILQ/Billion-Dollar-Bait-Switch-States-Divert-Foreclosure-Deal-Funds.html Five of the biggest U.S. banks agreed this year to a $2.5 nationwide settlement over foreclosure wrongdoing, but ProPublica has discovered that states are siphoning a big chunk of that money for purposes having nothing to do with the foreclosure epidemic. According to its analysis, some $974 million -- or almost 40 percent of the settlement amount -- has been redirected to other programs; while just $527 million has been set aside for new homeowner-oriented initiatives. The finding contradicts what state and federal officials said when the agreement was announced. At the time, they vowed that the funding would primarily go to housing counselors, which have been shown to help homeowners better avoid foreclosure; and to legal aid groups, which can provide the legal aid that borrowers usually lack in foreclosure cases. ProPublica's analysis also is surprising due to the fact that some of the states hit hardest by the foreclosure crisis -- including Arizona, California, Georgia, South Carolina, Wisconsin, and Maine -- are among those that are earmarking some or all of their share of the pot to their general funds. Thu, 24 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/Billion-Dollar-Bait-Switch-States-Divert-Foreclosure-Deal-Funds.html www.responsiblelending.org-338072574 http://feedproxy.google.com/~r/CrlHeadlines/~3/zh9Hu3FPLe0/Consumer-Protections-Considered-for-Prepaid-Debit-Cards.html New federal regulations may soon apply to prepaid debit cards, requiring more transparent fee disclosures and greater financial protections. The Consumer Financial Protection Bureau says it is considering new protections for users of these prepaid cards, and it is seeking comment from experts and the public. "We have a duty to make sure these products are safe for consumers and that prepaid card managers do not make money by relying on tricks and traps," CFPB director Richard Cordray said. Prepaid cards often come with high fees applied to various activities, such as reloading money and contacting customer service. They are most popular among Millennials and consumers who earn less than $15,000 a year. Mercator Advisory Group recently estimated that the industry will grow by more than 40 percent in the next two years. However, prepaids lack the same protections as bank-based debit cards, such as when the card is lost or stolen. Supporters of prepaid cards say that many issuers already provide protections voluntarily, but most consumers purchase prepaid cards from sellers that do not offer these protections. "A big part of CFPB [getting involved] is creating a level playing field so people have the same rights and protections on prepaid cards as they do on a debit card," according to Lauren Saunders of the National Consumer Law Center. Thu, 24 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/Consumer-Protections-Considered-for-Prepaid-Debit-Cards.html www.responsiblelending.org-338073522 http://feedproxy.google.com/~r/CrlHeadlines/~3/CqgDLJhtc6g/Firm-Targets-CA-Homeowners-With-Foreclosed-2nd-Mortgages.html California Watch -- part of the nonprofit Center for Investigative Reporting -- has found that despite going through a foreclosure during the housing bust, many state residents now are being harassed for payments on their second mortgages. California law stipulates that once a house in sold in foreclosure, lenders cannot go after the borrower for any other debts on the same property. But of the estimated 800,000 borrowers in the state who lost their homes to foreclosure, many are receiving letters from a Texas company. Heritage Pacific Financial has sent the correspondence to hundreds of people, claiming that fraud was involved in the mortgage application process. State law allows lenders to pursue second mortgages if they can prove the borrower committed fraud. The lawsuits accuse the borrowers of being dishonest about their employment, income, and residence. But the company told the accused that if they paid up, they would be left alone. "What they're banking on is that most consumers don't know their rights and don't have the financial ability to hire an attorney and they pressure them to pay," said Will Kennedy, a consumer law attorney in Santa Clara. "And many people, unfortunately, do pay." Wed, 23 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/Firm-Targets-CA-Homeowners-With-Foreclosed-2nd-Mortgages.html www.responsiblelending.org-338073800 http://feedproxy.google.com/~r/CrlHeadlines/~3/s1LycbFZEkI/The-Fee-That-Credit-Card-Issuers-Are-Leaving-Behind.html While credit card fees are plentiful and far-reaching, an increasing number of the country's biggest issuers are dropping foreign transaction charges. The once-standard fee typically adds another 3 percent to every swipe of the card. Now, the majority of big banks are eliminating the charge. According to Odysseas Papadimitriou, founder and CEO of CardHub.com, the number of credit cards that carry the fee has declined by more than 8 percentage points in the last year. Additionally, the average fee amount has fallen approximately 6 percent during the same period. Banks have a variety of reasons for scrapping the foreign transaction or foreign currency fee. First, because banks' financial health is returning, profits are up. Papadimitriou said the fee was not a big revenue generator, anyway. Plus, the policy often upset customers. Papadimitriou said card carriers would rather hang on to good customers than lose them over such a policy. Wed, 23 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/The-Fee-That-Credit-Card-Issuers-Are-Leaving-Behind.html www.responsiblelending.org-338068245 http://feedproxy.google.com/~r/CrlHeadlines/~3/k7yGU-4h1oE/The-Long-Foreclosure-Fight.html The Santa Cruz County Board of Supervisors is encouraging banks in the area to postpone foreclosure filings until the so-called California Homeowner's Bill of Rights is passed by the state legislature. While the board is not empowered to outlaw the practice, it adopted a resolution "urging" a temporary halt in foreclosure filings. County Counsel Dana McCrea told the board that creating a ban likely would encourage litigation and would not be permitted under state law. At a recent meeting, members voiced frustration with the "lack of legal space" at the county level to seriously challenge banks on predatory practices. Local activists are skeptical that the Bill of Rights will pass, due to significant lobbying by banks. Meanwhile, two other developments have angered consumer advocates: a forensic audit by the City and County of San Francisco Assessor-Recorder, which found that 82 percent of foreclosures studied were legally defective; and a significant reduction of foreclosure filings in Nevada due to tough consumer protection laws put in place in October. Supervisors are not the only ones upset about the increased lobbying. The Center for Responsible Lending said frustration is high within its organization. Spokesperson Ginna Green said the group is upset because the legislation is getting blocked by key members of the state Assembly and Senate. She says CRL is "ready to take the gloves off, and start naming names of those members in the state legislature who are blocking the California Homeowners Bill of Rights legislation." Wed, 23 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/The-Long-Foreclosure-Fight.html www.responsiblelending.org-338067869 http://feedproxy.google.com/~r/CrlHeadlines/~3/_d0qIMvuQVw/Consumer-Watchdog-Focusing-on-Prepaid-Cards.html The Consumer Financial Protection Bureau, estimating that the amount of money loaded onto prepaid cards will balloon from $57 billion in 2011 to $167 billion in 2014, is seeking input on how to better regulate the business. "Right now, prepaid cards have far fewer regulatory protections than bank accounts or debit cards or credit cards," CFPB director Richard Cordray is expected to say at an upcoming hearing on prepaids in Durham, N.C. The agency says it wants to learn more about the fees -- including reportedly high charges for replacing a card -- as well as how overdrafts should be managed and whether the cards are a good way for consumers to build a history of good credit. The CFPB additionally will look at how card providers deal with stolen cards or when they are used without the holder's permission. With those objectives in mind, on May 23 it is releasing a request for information in advance of writing new regulations. Wed, 23 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/Consumer-Watchdog-Focusing-on-Prepaid-Cards.html www.responsiblelending.org-338073197 http://feedproxy.google.com/~r/CrlHeadlines/~3/uoPU7KHKxdQ/Survey-Finds-CARD-Act-Helping-Reduce-Debt-Load.html National research firm DEMOS reports that a recent survey of low- and middle-income consumers indicates the 2009 Credit Card Accountability Responsibility and Disclosure Act is helping to alleviate credit card debt load. A third of households surveyed reported that they are responding to new information displayed in credit card statements by paying their balances faster. The new disclosures include how long it would take the borrower to pay down a credit card balance by submitting only the minimum payment each month. The poll also found that the households were using the CARD Act to avoid fees and punitive interest rates. In a 2008 survey, 50 percent of low- and middle-income households reported accruing late fees, but the share has tumbled to only 28 percent in 2012. The survey found that 24 percent fewer households reported a higher interest rate due to a late payment. Tue, 22 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/Survey-Finds-CARD-Act-Helping-Reduce-Debt-Load.html www.responsiblelending.org-338074750 http://feedproxy.google.com/~r/CrlHeadlines/~3/kwUsII3tst4/Rate-of-Late-Auto-Loan-Payments-Sinks-to-Lowest-Level-Since-1999-in-1st-Quarter.html The pace of late payments for auto loans fell nationwide in the first three months of the year to the lowest level in more than a decade, even though lenders have granted financing for more high-risk borrowers. For the 2012 first quarter, the rate of U.S. auto loan payments 60 days or more past due declined to 0.36 percent, about 27 percent lower than the same period of last year, according to TransUnion. That also is down about 22 percent from the fourth quarter of 2011. The latest rate is the lowest since TransUnion began tracking auto loan data in 1999. Auto loan delinquencies have been trending downward on an annual basis for the last 10 quarters in a row -- in part because, after the last recession, many borrowers opted to pay their car notes ahead of their mortgage, credit cards, and other debts. Tue, 22 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/Rate-of-Late-Auto-Loan-Payments-Sinks-to-Lowest-Level-Since-1999-in-1st-Quarter.html www.responsiblelending.org-338070331 http://feedproxy.google.com/~r/CrlHeadlines/~3/YOSA7PdR9GM/Court-Homeowners-Can-Sue-Over-Some-Loan-Modifcation-Denials.html This month, the Seventh Circuit Court of Appeals made the unprecedented ruling that homeowners can file suit against banks that they believe turned them down for a mortgage modification without just cause. Chicago attorney Rafey Balabanian said it was a "monumental decision" against what he called banks' "intentional incompetence" with applications submitted under the Home Affordable Modification Program. Balabanian is involved in a case against Wells Fargo concerning one homeowner's inability to receive approval; he alleges that the bank keeps placing unfair requirements on borrowers while they wait for their application to be approved. A 75-year-old woman spent months trying to clear up a case of mistaken identity with Wells Fargo, having to reapply for a loan workout four times since 2009. She ultimately received a modification by the bank, which acknowledged that it could have done a better job of communicating with the borrower. Tue, 22 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/Court-Homeowners-Can-Sue-Over-Some-Loan-Modifcation-Denials.html www.responsiblelending.org-338074970 http://feedproxy.google.com/~r/CrlHeadlines/~3/HULC9F4mAJ4/The-Subprime-Generation-Stop-Using-Dubious-Financial-Services.html An increasing number of young Americans are using non-traditional financial services, including questionable practices such as payday lenders and prepaid debit cards. A study released by Think Finance found that 51 percent of young Americans making $50,000 to $74,999 used prepaid debit cards within the last year, the same percentage as those whose income was under $25,000. Twenty-nine percent of higher-income individuals used check-cashing services, compared to 34 percent of those under earning $25,000 or less. Seventeen percent of those making nearly $75,000 made purchases at rent-to-own stores, compared to 15 percent of those in the lower income bracket. The study also found that 83 percent of consumers aged 18 to 34 reported a positive or neutral experience with emergency cash services. Eric Bell, founder of yobucko.com, says many younger Americans are less trustful of the traditional financial system; but others simply may lack financial literacy. Young Americans who cannot get a regular debit card may not realize that it would be better to get a secured credit card and place a small amount of money on the card as a credit limit, rather than use prepaid debit cards. Instead of using a check-cashing service, meanwhile, young people should find out if they are eligible to join a credit union. Newer person-to-person lending services, such as lendingclub.com and prosper.com, may be better alternatives to payday lenders. The interest rates may still be high, but these services could help save money in the long run. Finally, rather than sell goods for cash at a pawn shop, consumers can get a little more money for their used items at a consignment or thrift shop. Tue, 22 May 2012 00:00:00 -0500 http://www.responsiblelending.org/tools-resources/headlines/The-Subprime-Generation-Stop-Using-Dubious-Financial-Services.html