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Credit Card Consumer Protections
August 31st, 2010 8:57 AM
By CANDICE CHOI
NEW YORK — Help is on the way for credit cardholders this weekend.

The final stage of consumer protections signed into law earlier this year go into effect Aug. 22. Yet they only curb select practices; other fees and charges still abound.

A look at the new safeguards, and how cardholders can still get burned.

Penalty fees
New protection: Fees for late payments and other transgressions will be capped to the amount of the violation, up to $25. Previously, these fees were often between $35 and $39 regardless of how much was owed. Also, a single violation can no longer result in more than one fee.

Gaps to watch: Technically, there isn't an outright ban on penalty fees higher than $25. Banks that want to impose a higher fee simply need to give regulators justification for doing so. For example, a bank might provide an analysis showing that the costs associated with late payments average out to $30 per violation, said Lauren Bowne, an attorney with Consumers Union in San Francisco.

It's too early to tell whether banks will pursue this route, but the door is open.

Another exception to the $25 cap is if a customer repeats the violation within six months. Then the cap rises to $35.

Also keep in mind that the rule applies specifically to penalty fees. There aren't any caps on other charges. And not surprisingly, many issuers hiked fees for balance transfers, foreign transactions and cash advances in the past year.

Rate hikes
New protection: Banks must review a rate hike every six months to decide whether the increase is still warranted. If the factors that prompted the hike are no longer applicable, the rate must be lowered.

This rule applies to hikes dating back to Jan. 1 of last year, when banks began raising rates in anticipation of the new regulations.

Gaps to watch: Even if a bank finds that a rate should be lowered, the reduction doesn't have to restore the prior interest rate. So even if a rate was increased 10 percent, a review could result in a 1 percent scaleback.

Banks also have some wiggle room in the factors they use to conduct reviews. They can either base a review on the original reason for the rate hike, such as market conditions. Or they can determine whether the rate is in line with their current interest rates for new customers.

That leeway means rate hike reviews likely won't bring consumers too much relief, said Bowne of Consumers Union.

Also note that such reviews are not required for cards with variable rates, which rise and fall with a certain benchmark, such as the prime rate.

Inactivity fees
New protection:
These fees will be banned regardless of how they're dressed up. For example, an annual fee that's waived if a customer spends a certain amount is still an inactivity fees.

Gap to watch: There's still a reason to keep a card active, even if by making a small purchase here and there: Banks can still close inactive accounts. That could hurt your credit score depending on how long you've had the account and your broader financial standing.

This happened to many customers during the credit crunch, as card issuers looked to limit their exposure to risk by closing unprofitable accounts.

Copyright 2010 The Associated Press. All rights reserved.


Posted by Russell Rowe on August 31st, 2010 8:57 AMPost a Comment (0)

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Mortgage Rates Drop - 9th Time This Year!
August 27th, 2010 2:32 PM

4.36% mortgages spur refinancers

Record low finds few in a position to buy, but 8 out of 10 loans go to homeowners grabbing payments half the size of a generation ago.

Once again, mortgage rates have dropped to the lowest levels seen in most of our lifetimes. Once again, few Americans can take advantage of the low rates to refinance or buy homes.

 According to Freddie Mac's weekly Primary Mortgage Market Survey, the average rate for a 30-year fixed-rate mortgage is 4.36% this week, the lowest rate since Freddie Mac started keeping records in 1971 and a rate not seen since the 1950s, according to the National Bureau of Economic Research, when loan terms were shorter.

Posted by Teresa Mears MSN


Posted by Russell Rowe on August 27th, 2010 2:32 PMPost a Comment (0)

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How To Reduce Credit Card Debt
August 19th, 2010 4:04 PM

Reducing credit card debt is usually a person's first step toward financial freedom.  As our society has increasingly become of a quick fix mentality, more people have fallen victim to the "buy now and pay later" disease. They sometimes string payments out over such a long period of time it makes their original purchase much more expensive than they counted on.  Until the credit cards are reigned in, a person doesn't stand a chance of becoming financially free.  Below is a starting point toward getting the monkey off your back.

1. Make a list of all of your credit cards. Start with the smallest balance on the top of the list and the largest balance on the bottom. Also write down the minimum payment that is due on the credit card at this time. Credit card minimum payments go down as the balance goes down.  It's tempting to just keep paying only the minimum as it goes down, but that strategy will only hold you captive for longer.  Continue paying what you have become accustomed to paying.

2. If you cannot pay cash for an item, do not purchase it. You will never get out of credit card debt if you do not stop using your credit cards...or at least using them responsibly.  If you cannot pay the balance in full each month stop using them!

3.  Use any unexpected cash flow to eliminate the debt.  Instead of treating this cash as an opportunity to splurge, strongly consider putting the entire amount toward the credit card with the smallest balance in order to expedite your pay off date.



 

Posted by Lynda Fleming, Customer Service Rep. for Integrity Mortgage


Posted by Russell Rowe on August 19th, 2010 4:04 PMPost a Comment (0)

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Current Interest Rates Are Phenomenal!
August 12th, 2010 4:37 PM

Federal interest rates on home loans remain low, making it a great time for homeowners to refinance. Since we can't predict the future, there is no way of knowing how long these low interest rates will hold.  If you have been thinking of refinancing, this might be exactly the right time to compare the rate you're paying to the current market rate and see if you can save money by refinancing.

People refinance for a variety of reasons including:

  • Reducing interest costs by refinancing at a lower rate.
  • Lowering monthly mortgage payments
  • Extending repayment time.
  • Paying off other high interest debts.
  • Raising cash for investment or use in other ways

On April 9, 2009, President Barack Obama said, "There are 7 to 9 million people across the country who right now could be taking advantage of lower mortgage rates. That is money in their pocket. And we estimate that the average family can get anywhere from $1,600 to $2,000 a year in savings by taking advantage of these various mortgage programs that have been put in place."

This phenomenal opportunity to refinance should certainly be given serious consideration.

 

Posted by Lynda Fleming, Customer Service Rep. for Integrity Mortgage

 

 

 


Posted by Russell Rowe on August 12th, 2010 4:37 PMPost a Comment (0)

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Info From News First 5 - Debit Card Skimming Suspect
August 6th, 2010 10:40 AM

News First 5 posted the following article about the Colorado Springs debit/credit card skimming suspect.  You can go to their website to see a picture of the suspect.

Posted : Aug 6, 2010 9:20 AM
Updated: Aug 6, 2010 9:26 AM

Colorado Springs residents have reported having their bank accounts cleaned-out after their information was stolen from debit card skimmers. The skimmers also steal credit card information.

Tens of thousands of dollars has already been taken.

Police have now released a photo of a man they believe installed at least one of the skimmers. If you recognize him, phone CSPD at 719-444-7000.

The following gas stations have been victimized by the skimmers:

Valero/Diamond Shamrock, 8100 N. Academy
Valero/Diamond Shamrock, 1700 S. Nevada
Valero/Diamond Shamrock, Forest Hill and Garden of the Gods
Valero/Diamond Shamrock, East Woodmen and Union Blvd.

Any gas station is vulnerable to this sort of skimming. Police recommend that you check your bank account online regularly.

 www.NewsFirst5.com  (News section)


Posted by Russell Rowe on August 6th, 2010 10:40 AMPost a Comment (0)

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Credit Card Dilemma
August 3rd, 2010 10:13 AM

Credit Card Debt is similar to losing weight - easy to gain; hard to lose. But losing weight is not impossible and neither is getting out of credit card debt.  It takes hard work, discipline, and perhaps getting help. Most consumers are only able to make the minimum payments and soon find their balances increasing, which causes more frustration and stress. 

We all know our country has struggled the past year.  Unemployment or under employment has been rampant and many people have gotten bogged down with escalating credit card debt. 

I was listening to the radio as I drove to work this morning.  I heard the average household credit card debt is $10,000 or more with most people paying only the minimum payment due each month.  Credit card companies are legally allowed to charge outrageous finance charges - that makes the Starbucks you charged last year now worth the price of a small island in the Caribbean.  I'm sure you get my point.

Just as losing weight takes discipline and hard work, so does the financial diet of losing your credit card debt.  This week think about some possibilities to eliminate those in the fastest amount of time.  Significant changes can be made with focused, consistent action.

 


Posted by Russell Rowe on August 3rd, 2010 10:13 AMPost a Comment (0)

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Thanks for visiting our website and reading our blog!
July 26th, 2010 3:20 PM

We recently checked our backoffice statistics, and we are impressed with how many people are coming to our website.  We are specifically impressed with how many are reading this blog.  Thank you!  That's a huge compliment.

We also see that quite alot of our website visitors are checking out the staff profiles.  We're sorry we haven't gotten pictures and bios of the staff posted, but that's on the top of our priority list!

We've started doing email blasts to our clients in an attempt to keep them updated about the current mortgage market.  We have been reminding them that interest rates have hit an all time low, and it's a great time to refinance or purchase!

Give us a call to talk over your specific mortgage needs.

We appreciate you! 

 


Posted by Russell Rowe on July 26th, 2010 3:20 PMPost a Comment (0)

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What A Mortgage Broker Looks At When You Apply For A Loan
July 19th, 2010 11:35 AM

The Basics that a mortgage broker looks at when you apply for a mortgage are:

1. The Number of Open Credit Accounts You Have - Mortgage lenders always evaluate the number of open lines of credit that a mortgage applicant has. They then analyze that information to determine the risk they would face by funding the mortgage. The mortgage lender will then project a hypothetical situation where the applicant has maxed out all of their available credit lines and are paying the minimum required on all those accounts. This information is then factored into the debt-to-income ratio to see if the applicant would still be able to pay the mortgage every month.

2. Your Length of Employment - Since the ability to pay a loan every month is directly affected by an applicant's employment, this is one of the main concerns for mortgage lenders. The longer a borrower has had the same job, the more experience he will have with his weekly or monthly paychecks. Conversely, an applicant who has recently changed jobs may not yet be used to the new pay scale, or to the new paycheck's deductions, etc. A longer employment with the same company also implies to the lender that the applicant is stable and dependable. On the flip side, a loan applicant with a scattered employment history and only a short period of time with the current employer could indicate potential problems in the future. If a borrower changes jobs frequently, it is likely that new employment compensation will not be stable.

3. The Number of Closed Accounts You Have - Mortgage lenders analyze credit history to see if there are any recently closed major revolving lines of credit prior to applying for a mortgage loan. A credit report will specify exactly when the account was closed, as well as who made the close request (creditor or borrower). If too many credit accounts were closed at the same time, lenders may ask for more information about the reasons for the closures.

4. Your Length of Employment - Since the ability to pay a loan every month is directly affected by an applicant's employment, this is one of the main concerns for mortgage lenders. The longer a borrower has had the same job, the more experience he will have with his weekly or monthly paychecks. Conversely, an applicant who has recently changed jobs may not yet be used to the new pay scale, or to the new paycheck's deductions, etc. A longer employment with the same company also implies to the lender that the applicant is stable and dependable. On the flip side, a loan applicant with a scattered employment history and only a short period of time with the current employer could indicate potential problems in the future. If a borrower changes jobs frequently, it is likely that new employment compensation will not be stable.


Posted by Russell Rowe on July 19th, 2010 11:35 AMPost a Comment (0)

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President Obama's Making Home Affordable Program Part 2
July 12th, 2010 2:11 PM

Each state Housing Finance Agency (HFA) gathered public input and created Hardest Hit Fund programs designed to meet the unique challenges facing struggling homeowners in their respective housing markets. The five HFAs submitted their Hardest Hit Fund proposals to Treasury on April 16. Treasury then reviewed each state's proposals to ensure compliance with the Emergency Economic Stabilization Act (EESA) and offered technical assistance to develop performance and reporting metrics. Approved states will now begin to set up and roll out their specific Hardest Hit Fund programs in order to provide relief to struggling homeowners as soon as possible, with specific implementation timing depending on the types of programs offered, specific state-level procurement procedures, and other factors.

The proposals approved today include programs to assist struggling homeowners with negative equity through principal reduction; assist the unemployed or under-employed make their mortgage payments; facilitate the settlement of second liens; facilitate short sales and/or deeds-in-lieu of foreclosure; and assist in the payment of arrearages.

In March 2010, the Obama Administration announced a second round of Hardest Hit Fund aid totaling $600 million for five additional states with high areas of concentrated unemployment: North Carolina, Ohio, Oregon, Rhode Island, and South Carolina. The proposals that these states submitted are currently being reviewed.

A state-by-state summary of the Hardest Hit Fund proposals approved today is available below. For copies of the approved proposals, visit: http://www.financialstability.gov/roadtostability/hardesthitfund.html


Posted by Russell Rowe on July 12th, 2010 2:11 PMPost a Comment (0)

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President Obama's Making Home Affordable Program Part 1
July 7th, 2010 3:55 PM

OBAMA ADMINISTRATION APPROVES STATE PLANS FOR USE OF $1.5 BILLION IN

'HARDEST HIT FUND' FORECLOSURE-PREVENTION FUNDING

Arizona, California, Florida, Michigan, and Nevada Will Receive First Round of Funding Under Program to Support Innovative Local Initiatives to Assist Struggling Homeowners in States Hit Hardest by the Housing Crisis

WASHINGTON - State Housing Finance Agencies (HFAs) in Arizona, California, Florida, Michigan, and Nevada can begin to use $1.5 billion in "Hardest Hit Fund" foreclosure-prevention funding under plans approved today by the Obama Administration. This aid will support innovative local initiatives to assist struggling homeowners in those states, as part of the first round of funding available under this new program.

"These states have identified a number of innovative programs that will make a real difference in the lives of many homeowners facing foreclosure," said Treasury Assistant Secretary for Financial Stability Herbert M. Allison, Jr. "While we've made important progress stabilizing the housing market and keeping responsible families in their homes, the Obama Administration will continue to do everything it can to help those who are struggling the most during this difficult time. Today marks an important milestone for delivering relief to homeowners through the Hardest Hit Fund program."

President Obama established the Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets ("Hardest Hit Fund") in February 2010 to provide targeted aid to families in the states hit hardest by the housing downturn. The states approved to receive aid today as part of the first round of funding provided through this program each experienced a 20 percent or greater decline in average housing prices.

http://www.financialstability.gov/roadtostability/hardesthitfund.html


Posted by Russell Rowe on July 7th, 2010 3:55 PMPost a Comment (0)

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