I suspect some readers will say that Assefa Senbet is to blame for screwing up one of his final payments to Citibank on a deferred interest loan agreement. They’ll be right–it was his responsibility. But he didn’t skip a payment, and he wasn’t late. In fact, he frequently overpaid in order to pay it off early. Near the end of the loan, however, he sent in a check for $70 instead of $81. As a consequence, he’s now paying off $887 in deferred interest fees at a 30% interest rate. [More]
loans
This Citibank Balance Transfer Offer Sure Sounds Dangerous
By 12.16.09
RP was just offered a transfer on his Citi card by a Citibank CSR, but the CSR was kind of vague on the details of the offer and could only repeat the benefits. RP looked online while the CSR pitched the offer, and found that there’s quite a big catch in the fine print–after six months, the interest rate jumps from 3.99% to 29.99%. [More]
Wife Sues Debt Collector For Husband's Death
By 12.15.09
As we told you in September, a woman is suing a debt collector for her husband’s final heart attack and death. [More]
Give Us Your Questions For The White House: Small Business Edition
By 12.9.09
Yesterday, President Obama spoke at the Brookings Institute about his administration’s plan for spurring job growth in our not-quite-a-recession-anymore-but-still-pretty-much-a-recession. Now they’ve invited Consumerist to bring our readers’ questions about the program to Austan Goolsbee, the staff director and chief economist on the President’s Economic Recovery Advisory Board. [More]
Go Ahead, Strategically Default On Your Underwater Mortgage
By 12.2.09
“Homeowners should be walking away in droves. But they aren’t. And it’s not because the financial costs of foreclosure outweigh the benefits. One can have a good credit rating again–meaning above 660–within two years after a foreclosure.” That’s the conclusion reached by a law professor who’s written a paper about strategic default, which is when you elect to walk away from an underwater mortgage because you stand to lose more money trying to keep it than if you cut your losses immediately. The problem is, lots of people think it’s the wrong thing to do, because individuals are supposed to play by different rules than the companies they do business with. [More]
Sample Phone Scripts Used By Sleazy Subprime Lenders In 2005
By 12.2.09
An ex-subprime lender employee of a sent us the scripts they used to cold-call homeowners back in 2005 to get them to ditch their 30-year fixed mortgages for risky sub-prime loans. One of them is called, “Wholesale Gangsta Script,” which I think about says it all right there. [More]
Experian Fixes Messed Up Credit Report By Deleting Everything
By 12.1.09
Monique X. is trying to get a loan to consolidate her debts into a more affordable payment. She writes that she’s been careful with her credit history and knew that her credit score was adequate to get approved at her bank, “even with the economy the way it is.” That’s when she discovered that someone else’s accounts had been folded into hers, and that Experian’s solution to their error was as bad as the problem. [More]
Am I Responsible For My Parents' Debt?
By 11.13.09
Jay’s parents have gotten quite, uh, spendy with their retirement income, and now they’ve got a lot of debt they can’t pay off. This has become Jay’s problem not because he’s a party to any of the debt, but because they’ve put him down as a reference and now bill collectors are harassing him.
When To Buy A Home And How To Avoid Screwing It Up
By 11.2.09
Are you hitting that stage in life where you’re thinking of becoming a homeowner? Morningstar has published two home buying articles that together offer some good, concise advice to the prospective buyer, especially if you’re a first-timer.
40 States Ask FTC To Crack Down On Debt Relief Companies
By 10.28.09
Attorneys general in 40 states just asked the FTC to step up the fight against debt relief companies that mislead and overcharge consumers, like Credit Solutions of America (CSA), reports Consumer Affairs.
How A Disputed Item On Your Credit Report Can Screw Up Your Home Loan
By 10.26.09
Thanks to federal regulations, when you dispute an account on your credit report and the dispute is resolved in your favor, the credit reporting agency is required to remove or correct the account. Credit reporting agencies often don’t do this, though, and the Washington Post notes that it can come back and interfere with your next home loan application.
What's The Difference Between A HELOC And A Second Mortgage?
By 10.16.09
Guest posting on the personal finance blog Budgets Are Sexy, Robert Sommers explains the difference between home equity lines of credit and home equity loans, which are also known as second mortgages.
Consumer And Banking Scholars Speak Out In Favor Of Consumer Financial Protection Agency
By 10.2.09
Earlier this week, a group of 70 law professors from universities across the country released a 16-page Statement of Support (pdf) detailing why they’re in favor of the proposed Consumer Financial Protection Act. You can read the statement yourself via the link above, but we’ve summarized them below.
Homeowners With Good Credit Are More Likely To Strategically Default
By 9.25.09
Here’s an interesting discovery about mortgage defaults from the LA Times:
Consumer Financial Protection Agency Gets Watered Down
By 9.24.09
There’s been so much resistance to the proposed Consumer Financial Protection Agency that Rep. Barney Frank, the chairman of the House Financial Services Committee, has proposed a less powerful version of the agency in an attempt to get it passed. Here’s what’s changed:
Old Debts Under $100 Don't Matter Under FICO '08
By 9.24.09
An update to how the new FICO ’08 scoring system got revamped this year:
Banks Cling To Overdraft Fees Because They Need Them To Survive
By 9.10.09
Banks now make more on debit card overdraft fees than credit card penalties—they’ll rake in about $27 billion in 2009 alone, according to the New York Times. They obviously have zero incentive to curb the practice. In fact, one economist told the paper that “45 percent of the nation’s banks and credit unions collect more from overdraft services than they make in profits.”
