“[Debt] Collectors actually care about consumers… They want to teach consumers how to get out of debt. They’re trying to put themselves out of business.” – Rozanne Andersen, general counsel of ACA International (formerly the American Collectors Association) as quoted in this morning’s NYT article, “Debt Collectors Try to Put on a Friendlier Face.” As times get tougher and the options for borrowing from Peter to pay Paul shrink, more accounts are becoming delinquent. This means booming business for debt collectors, but increased activity could bring scrutiny from politicians and regulators, as well as consumer backlash. So, infamous for harassing debtors with abusive and threatening language and incessant calls (all violations of Federal regulations), the industry is trying a new tactic: playing Mr. Nice Guy. They’re conducting personal finance management courses, writing columns about how Abraham Lincoln couldn’t pay his debts, and opened a full-time lobbying office in Washington DC this month.
loans
Motivational Company Waterboarded Employees?
Motivational coaching company Prosper is the subject of an unusual lawsuit: “A supervisor…is accused of waterboarding an employee in front of his sales team to demonstrate that they should work as hard on sales as the employee had worked to breathe.” C’mon team, let’s Gitmo sales! [Salt Lake Tribuine]
50 Small to Midsize Banks Could Fail Next Year
Analysts estimate that 50 out of the nation’s 7,500 small and midsize banks will fail in the next 12 to 18 month, due to defaults on commercial real estate loans. The best quote in this NYT article comes from Timothy W. Long, head of supervision for midsize and community banks at the office of the comptroller, “I would tell you a lot of bankers out there have never had a loan charged off…The last time we went through this, the loan officers were in junior high.”
Email To BoA Exec Reduces APR In Face Of Rude CSRs
Donald writes:
First and foremost i would like to thank you for the wonderful site. The information found here has been extremely useful. With that said i just want to share with you a success story i had with getting Bank Of America to lower the interest rate on my Apple GoldReserve Line of Credit. This story does not start out so nicely though.
Payday Lenders Convince Elderly To Assign Social Security Checks To Them, Hand Back Allowances
This writer is quickly growing convinced that payday lenders are the modern version of indentured servitude, trapping consumers in cycles of debt that simply cannot be broken in their lifetimes.
Auto Loan Crash? Lots Are Overflowing With Repossessions
So many vehicles are being snatched from owners who stop making payments that some repo operators and auto auctioneers say lots are overflowing.
Goldman Sachs: By 2009 You May Owe More Than Your Home Is Worth
Home prices experienced the steepest drop on record for a single quarter says the National Association of Realtors:
The national median price drop of 5.8%, to $206,200 from $219,300, was the steepest ever recorded by the National Association of Realtors (NAR), which has been compiling the report since 1979.
Countrywide Says "Our Investors Require" Us To Rip You Off
3. PMI [Ed. A type of insurance a borrower pays to the lender to protect the lender in case the borrower defaults. It is typically required when putting down less than 20%]. Because this was our first home loan, and it was considered a “jumbo” (I hate that term), they required us to have PMI (despite having put down 20%). During the summer of 2005, we were nearing the magic 80/20 Loan-to-Value ratio, which I believed to be sufficient to have them remove our PMI…
Don't Be Ashamed To Ask Friends Or Family For A Loan
Taking a private loan from friends or family can be a win-win proposition, not necessarily a shame-filled dish with a side order of failure. Private loans are an ideal way to reduce the amount you need to borrow from a bank—instead of paying loan application fees, processing fees and higher rates, you can save money while offering attractive yields to your friends and family.
Easily Compare Wholesale Mortgage Rates Online
Mortgage Professor has a great no-frills online tool for tracking the wholesale mortgage rates. Just go here, Select your geographic area, and time period to look at. Choose whether you want your data in chart or table format (I suggest table, as the chart data isn’t as up to date), and what kind of mortgage you want to look at. You can further sort the results by FICO, loan purpose, loan size, type of documentation, or size of down payment. The data comes from Amerisave. A great way to check out mortgage rates, and how strong you have to be to get them. Plus, you can use it to compare how much of a markup your broker is charging.
Mortgage Broker Confessions
“When I have a client I really don’t like — he’s a pain in the ass — that’s when I charge as much as I can get out of them,” one mortgage broker told the Joe Consumer blog. That’s right, a lot of mortgage broker fees are bullshit. It’s important to get a good faith estimate and shop around for things like your title and escrow.
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A consumer who received a collections notice that began, “DEAR SHITFACE,” will sue the collections agency next week. [Caveat Emptor]
5 Car Lease Myths
Mark Solheim over on Kiplinger thinks leasing cars has a bad rap, and that more people should be doing it. “If you know what you’re looking for and negotiate smart—and get over the five myths below—leasing can be a good deal.”
Exciting New Service Helps You Walk Away From Your Mortgage!
You will immediately know the exact amount of days you have to live in your house payment free. We stay on top of your walk away plan and keep you up to date with weekly progress emails. We also will notify you if the lender is taking longer than expected subsequently giving you more time in your home payment free.
It’s like a spoof, except real!
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How to use the drop in interest rates to refinance your home mortgage and get a better deal. [Kiplinger]
Woman's Credit History Goes Missing, Giving Her A Credit Score Of Zero
When Cindy X pulled her credit report from TransUnion recently, it was blank. “I am 48, have an active credit history, and my other credit reports were accurate,” she writes in to Kiplinger. TransUnion, however, told her that she was on her own to fix the problem and would have to contact her creditors individually.
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Countrywide’s CEO is eschewing a $37.5 million severance package as he leaves the company that profited torrid billions during the housing bubble, sometimes through duplicity and reams of questionable fees. After all, there’s only so many gold-plated Rolls Royces one can drive. [Reuters]
When A House Is A Bad Investment, Is It OK To Just Walk Away?
Here’s one that’s sure to start some intense debate: If you’ve made a bad investment and your house isn’t worth what you thought it was going to be, is it OK to just walk away?
