Trendy Outfit – Mijas Guide http://mijasguide.com/ Mon, 26 Sep 2022 11:01:00 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://mijasguide.com/wp-content/uploads/2021/05/mijas-guide-icon-150x150.png Trendy Outfit – Mijas Guide http://mijasguide.com/ 32 32 Bank of America has always expected a big year from its lending business. Now it could be even better https://mijasguide.com/bank-of-america-has-always-expected-a-big-year-from-its-lending-business-now-it-could-be-even-better/ Mon, 26 Sep 2022 11:01:00 +0000 https://mijasguide.com/bank-of-america-has-always-expected-a-big-year-from-its-lending-business-now-it-could-be-even-better/

After two years of an ultra-low interest rate environment, Bank of America (BAC -2.37%) had high hopes for his loan business at the start of the year.

Not only did the second-largest US bank by assets thought business activity could finally pick up, but it also expected the Federal Reserve to raise interest rates to combat some of the highest levels of inflation. high observed for decades.

The Fed not only raised rates, it raised them aggressively, far more than anyone probably imagined at the start of the year. This could allow Bank of America’s lending and securities business to perform even better than management initially thought. Let me explain.

Net interest income up

A key part of any bank’s business is a source of income called net interest income (NII), which is the profit banks make on loans and securities after covering the cost of funding those assets.

Most banks tend to benefit from a rising rate environment as yields on more of their loans and securities will rise as the Fed raises rates. A bank’s deposit yields will also increase, but more moderately, especially if a bank has a good, stable, low-cost deposit base. Bank of America is one of the best in the industry, at least compared to other major banks. With the federal funds rate now in a range of 3% and 3.25%, Bank of America has already started to see the benefits for NII.

Image source: Bank of America.

Additionally, we already know from Bank of America’s second quarter earnings call that the NII is only expected to improve in the second half of the year as the Fed has only become more aggressively with rate hikes at its June, July and now September meetings. .

Bank of America Chief Financial Officer Alastair Borthwick told analysts on the second-quarter earnings call that assuming modest loan and deposit growth and disciplined deposit pricing, the NII in the third quarter would increase by $900 million to $1 billion from the NII’s $12.5 billion generated by the bank in the second quarter. . Next, Borthwick said management expects NII to grow at an even faster pace in the fourth quarter. When an analyst asked if the bank could emerge from the fourth quarter with an NII run rate of $15 billion, Borthwick said it was too early to tell, but didn’t rule it out either.

These indications were provided after the end of the second quarter. Today, interest rates are expected to end the year even higher than they were in July when the conference call took place. At its September meeting, the Fed raised the fed funds rate another 0.75%, and the Fed’s median forecast is that its benchmark rate will end the year at 4.4%. This implies another 0.75% rate hike and a half point hike at the last two Fed meetings this year.

Bank of America did not provide rate assumptions in July. But on its July second-quarter earnings call, JPMorgan Chase said he expected the federal funds rate to end the year at 3.5%, which is likely where Bank of America had set it.

At a recent conference call last week, Borthwick confirmed the bank’s guidance from the second quarter and said that, if anything, NII’s outlook has “moved slightly positively, and our beta experience of filing has been consistent or maybe even slightly better than we thought”.

What about the current environment?

It is true that the economic outlook is becoming more difficult and that a deeper recession in the near future seems increasingly inevitable. Like all banks, Bank of America has seen its investment banking business suffer from a lack of IPOs and other issuances. Mortgage banking is also hurt due to rising rates, and a severe recession could lower loan growth and consumer spending.

But much of Bank of America’s NII comes from investing excess cash in bonds, whose yields have risen with the federal funds rate. And while loan losses are expected to increase at some point, they are still incredibly low right now.

As the business environment becomes increasingly difficult, banks have not seen such a rate hike since before the Great Recession. As such, I expect Bank of America to end the year strong on the NII and potentially see this revenue line better than expected.

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Bank of America is an advertising partner of The Ascent, a Motley Fool company. Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool recommends JPMorgan Chase. The Motley Fool has a disclosure policy.

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DOJ Reaches First Settlement With PPP Lender Over Fake Loan Application | PC Weiner Brodsky Kider https://mijasguide.com/doj-reaches-first-settlement-with-ppp-lender-over-fake-loan-application-pc-weiner-brodsky-kider/ Sat, 24 Sep 2022 03:36:35 +0000 https://mijasguide.com/doj-reaches-first-settlement-with-ppp-lender-over-fake-loan-application-pc-weiner-brodsky-kider/

Earlier this month, the DOJ announced its first False Claims Act (FCA) settlement with a Paycheck Protection Program (PPP) lender, resolving allegations that the bank submitted statements fraudulent on behalf of an ineligible borrower applying for a loan.

In May 2020, shortly after Congress enacted the CARES (Coronavirus Aid, Relief and Economic Security) Act, the bank lender submitted an initial PPP loan application on behalf of its borrower, a pain management clinic based in Texas and its owner (Borrower). The lenders behind the PPP loans, such as the bank, are eligible to receive a commission of 1% to 5% from the Small Business Administration (SBA), with the commission varying depending on the size of the loan .

During the process of filling out the PPP application questionnaire, the Borrower replied in the negative to “if the applicant (or any person holding more than 20% of the capital) is the subject of an indictment, d criminal investigation, indictment or other means by which charges are brought in any jurisdiction[]”. However, following an investigation by the Office of the Inspector General of the Department of Health and Human Services and the Defense Criminal Investigative Services, it was determined that at the time of submission of the request, the Borrower faced criminal charges stemming from illegal practices of prescribing opioid drugs. Additionally, it was determined that the bank lender was aware of these pending charges, but nonetheless processed the request, containing the falsified response regarding the criminal charges. This application was submitted to the SBA not only in support of the borrower’s PPP application, but also in support of the Bank’s receipt of its origination fee from the SBA based on of its administration of the loan.

The borrower settled with the DOJ regarding its fraudulent submission in November 2021 and repaid the loan in full earlier this year. The bank lender’s settlement for $18,637.50 resolves the bank’s potential liability for knowingly submitting fraudulent information in support of the PPP application, and the fees collected by the bank. The DOJ noted that “[t]The settlement amount also reflects [the bank’s] efforts to cooperate with the government’s investigation and provide relevant facts as well as its implementation of additional compliance measures. Finally, the claims resolved by the settlement are allegations only and no determination of liability has been made in this matter.

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I’ve paid off student loans, but I support help for those who can’t https://mijasguide.com/ive-paid-off-student-loans-but-i-support-help-for-those-who-cant/ Tue, 20 Sep 2022 15:01:57 +0000 https://mijasguide.com/ive-paid-off-student-loans-but-i-support-help-for-those-who-cant/

In December 2019, my husband submitted his last student loan payment. From the time we got married and started attacking those student loans as a team, it took us 18 months to pay off $51,234.51. Of this debt, $34,134.51 was federal loans and $17,100 was private. There’s not a part of me that blames the millions of Americans who are about to receive $10,000 to $20,000 in student loan relief.

From the outside, it looks like my husband and I “got off the hook” to pay off that debt and heck, if we did, all student borrowers should too. But that’s just not a practical, kind, empathetic, or, frankly, reasonable response.

When it comes to the “bootstraps” story, it’s important to recognize that my husband and I were collectively earning in the six figures and had no other debt besides his student loans. Granted, we live in one of the most expensive cities in the country, but during this time we still had enough flexibility in our budget to aggressively pay off student loans and live our lives. There was no rice or beans. We still took vacations, went out to dinner, invested in our retirement plans, and had a healthy emergency savings account.

However, this strategy of accelerated earning while balancing a well-balanced life would not have been possible without getting married. Well, that’s not entirely true – I could have helped pay off his debt as an unmarried couple, but I didn’t and I’m not advising anyone to do so. My husband could not have afforded such an aggressive repayment strategy, even living a modest life, on his salary alone, which included overtime. In fact, getting married had a negative impact on her monthly payments.

My husband, like many others with federal student loans, followed an income-based repayment plan, which caps your monthly payments based on a percentage of your discretionary income. This means that those who do not earn a high salary but have large loans will have an affordable payment relative to their income. However, filing a joint tax return meant that my income was factored into the calculation and his minimum monthly payment had increased significantly.

We made the decision to aggressively repay student loans based on what was in our best interests as a family and our sanity. Wiping off his private loan made mathematical sense, but giving up federal student loan debt at a rapid pace didn’t make much sense on paper, especially since my husband was eligible for two different forgiveness programs through his work as a student. ‘teacher. Forgiveness programs, depending on the type, eliminate some or all of the remaining federal student loans after a certain number of services.

If we had chosen not to repay his federal loans aggressively, we could have paid down debt slowly on his income-driven repayment plan, and then we ended up enjoying 2 and a half years of a break on payments during the pandemic that would still have counted towards his pardon eligibility. That would have been thousands of dollars back in our bank account with a credit for the remaining balance canceled – plus the $10,000 relief.

But for me, there are no regrets.

We decided not to pursue forgiveness programs given the restrictions that would have kept my husband’s career in a particular type of waiting pattern for five years to a decade, depending on the program. For example, the civil service forgiveness program requires you to work for a government or non-profit organization for a decade before your loans can be forgiven. This means that if you have the ability or desire to enter the private sector before the end of your ten-year commitment, you will forfeit the ability to have your federal loans forgiven. This is a significant request that could have long-term consequences for someone’s career and potential earnings.

Then, at the start of the pandemic, my income started to hit rock bottom, and it was a huge relief to be at least debt-free at a time when everything seemed so unstable. Once the income issues passed and financial stability returned, I still felt grateful that we were able to get rid of debt anxiety.

Listen, I know some may still have problems – and my anecdotal story probably won’t change your mind – but this is a nuanced problem with no perfect solution. The decision to provide one-time lump-sum relief may be a flawed option, but it will provide a much-needed financial lifeline for many Americans, some of whom did not fully understand the consequences of taking out tens of thousands of dollars in student loans.

Historically, little or no meaningful education was provided to student borrowers. It was simple for people to access thousands of dollars in loans and not fully understand how much interest would accrue or even the true likelihood of gainful employment upon graduation. You could have made an informed decision based on the data and your employment situation might not have resulted in the salary you needed to stay on top of your student loans.

It’s easy to put a 2022 target on this, but I signed up in 2007 – before the financial crisis – and I’m in the middle of millennials. How many millennial seniors were sold a bill about career opportunities and the need for college only to end up being part of the mass layoffs and bottoming job market during the Great Recession? Then, when they finally started to feel some level of respite and financial stability, they were hit in the mouth by the pandemic.

Of course, there is plenty of information and resources available for someone to be proactive and do their own research. But we have to be realistic about whether the average 18-year-old makes rational, practical decisions rather than emotional ones. Even parents can push to go to the most prestigious school, no matter the cost. It’s also frustrating how many people point to “useless degrees” and “fancy schools” as if they’re the only graduates who will get help. It’s not just liberal arts majors who struggle with the burden of student loans. It is also irrational to expect everyone to be a STEM major.

For many, the concern is who will bear the financial burden of this student loan relief. Will it be the average taxpayer who did it to pay off student loans or never even accepted them? It’s unclear right now, and it’s understandable that people are concerned about their own wallets being hit to help someone else. However, there are many ways in which people’s taxes support systems where they receive little or no personal benefit, but help the community at large.

It’s always been strange to me how a contingent of people feel determined to make those who come behind them struggle in exactly the same way. We all know that life isn’t fair, and some of us will have breaks at certain times in our lives or receive moments of luck that others simply won’t. But it’s a strange phenomenon to want people to struggle just because you had to too. It is also a mistake that the next generation even has the opportunity to follow in the footsteps of its predecessors.

Will there be some of the relieved people who maybe could work harder? Sure. But will millions of Americans have a lifeline who have worked overtime or multiple jobs or had unfortunate situations that cost money? Certainly. Just because some people haven’t “deserved” relief from your personal metric doesn’t mean the many hard-working, struggling people shouldn’t get help.

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

Erin Lowry is a Bloomberg Opinion columnist covering personal finance. She is the author of the three-part “Broke Millennial” series.

More stories like this are available at bloomberg.com/opinion

]]> Senator John Cornyn Talks Student Loan Forgiveness, Border Security, Abortion and More https://mijasguide.com/senator-john-cornyn-talks-student-loan-forgiveness-border-security-abortion-and-more/ Sun, 18 Sep 2022 21:31:56 +0000 https://mijasguide.com/senator-john-cornyn-talks-student-loan-forgiveness-border-security-abortion-and-more/

For the latest edition of “Texas-The Problem Is…,” FOX 7 Austin reporter Rudy Koski spoke with Sen. John Cornyn.

The longtime Texas senator shares his thoughts on student loan forgiveness, border security, abortion laws and the 2024 presidential election.

KOSK: Texas Senator John Cornyn is tackling the big issues with us. We start first with the controversial Biden administration tuition bailout

CORNY: I think that’s a terrible message. It’s bad public policy and it’s unfair to people who have paid off their college debt by working two or three jobs or just consciously fulfilling their obligations.

KOSK: If we don’t, can we do anything to reduce the cost of education, reduce the cost of interest rates? It just doesn’t seem right. It’s too expensive, too expensive.

CORNY: Yes, it’s true. It is not fair. Currently, universities have no incentive to control the amount of money people go into debt. This is an area that I believe is ripe for reform.

KOSK: Internationally, the Biden administration wants to bring Iran back. Why is this such a bad idea?

CORNY: Well, because the Biden administration must be the world’s worst negotiator. We saw what happened with the Taliban in Afghanistan. And in that case, we know that Iran will always have a path to nuclear weapons, which is the worst idea I can think of.

KOSK: Democrats believe the Supreme Court paved the way for them to win in November with the abortion ruling. Do you agree?

CORNY: The problem with Roe v Wade is that the Supreme Court made a power grab saying we’re not going to let people decide the limits on abortion, which is admittedly a controversial topic even within the same families.

KOSK: But people are unhappy.

CORNY: So that’s something I think we’re going to have to keep discussing. Lawmakers are going to have to revisit it now that Roe is no longer with us, and voters will have a chance to speak up and find some sort of balance they can live with.

KOSK: Do you think more exceptions should be available in Texas?

CORNY: Well, I’m pro-life, proudly pro-life. I think I believe that life begins at conception. And so I’m pretty sure.

KOSK: But rape and incest.

CORNY: Well, I would make exceptions for those. I think that’s probably where the vast majority of people are, but they’re not in favor of late-term abortions.

KOSK: California has banned the sale of gas-powered vehicles by 2035. The right path?

CORNY: Wacky idea. I just think it’s very impractical. I think it’s frankly unfair to ask, you know, hard-working middle-class families to subsidize someone’s purchase of an $80,000 EV. It’s crazy. This is, of course, what the so-called Inflation Reduction Act did.

KOSK: No doubt there is a crisis at the border. Should the governor declare an invasion?

CORNY: Well, that’s too hard legal work. It is what it is. And I think in a colloquial sense, that’s kind of what we see.

KOSK: So say invasion. This is the way to go.

CORNY: I don’t think it solves the problem by calling it that. And that actually creates some uncertainty about who should be in charge of the border.

KOSK: The United States continues to send aid to the Ukrainians in their fight against the Russians. At what point do we say we can no longer fund this?

CORNY: I am all for providing them with the weapons they need to defend their country. But the longer it lasts, I think there will be more and more questions; where should we spend this money? Should we spend it there, or should we spend that money strengthening our defenses in Asia?

KOSK: Former President Donald Trump remains in the news as we inch closer to the next election cycle. Would you like to see him run again or stay on the sidelines?

CORNY: Well, I’m focusing on the midterm elections in 2022, and frankly, it looks like there will be a lot of people interested in running. And, you know, the decision to run for president is basically making the decision to put yourself and your family through a meat grinder.

KOSK: I don’t think you’re a burger, but have you thought about going to that meat grinder, if you’re going to throw your hat away?

CORNY: There is no no, I can answer unequivocally. I’ve been married for 43 years, and I’m not going to jeopardize that by announcing the presidency.

]]> Don’t be misled. Student Loan Forgiveness is a Good Thing https://mijasguide.com/dont-be-misled-student-loan-forgiveness-is-a-good-thing/ Fri, 16 Sep 2022 21:37:25 +0000 https://mijasguide.com/dont-be-misled-student-loan-forgiveness-is-a-good-thing/

I heard another person denounce the Biden-Harris administration’s student loan forgiveness plan as one that promotes the moral turpitude of our country.

Yes, there are people who really believe in it.

If I had a dollar for every time I heard someone file the Biden-Harris forgiveness plan, I might be able to pay off that Parent’s Plus loan I took out for one of my kids. Most people simply don’t understand how student loan programs have been used by for-profit companies posing as legitimate educational institutions to take advantage of Title IV of the Higher Education Act.

Emile Guillermo

This is what allows schools that exist solely for the purpose of making direct loans to large numbers of students of color. These schools wouldn’t exist if the vast majority of their income (and profits) didn’t come from direct student loans to students.

The HEA is a built-in incentive for schools to make loans whether they are repaid or not. The important number is the ratio. Ninety percent of a school’s revenue may come from the federal student loan program. Ten percent must come from other sources, such as students repaying their loans.

Schools actually receive money directly from the federal government to lend to students as their main income and profit. They stay in the 90/10 ratio by getting income from students repaying their loans. And when students default at a high rate, the debt is often sold to collection agencies, adding another revenue stream to that 10%.

And that’s all. This is the for-profit college business model.

Too bad it looks like a de facto federal welfare model that supports many for-profit educational corporations. They don’t need to ask alumni to donate to help keep the doors open. Truth be told, the likelihood of a former rich is slim on the salary of a certified dental technician. But that’s okay, schools just need the steady stream of students who won’t know what hits them when promises of “jobs for life” or jobs after programs end don’t materialize. not.

These students support for-profit schools simply by taking out loans. So don’t blame the students. If you’re looking for a sense of “moral turpitude” in the student loan business, look no further than for-profit schools that look better on paper than they really are, selling to students seeking hope and opportunities an invoice for the goods.

The Department of Education recently added to the Hall of Shame which already includes institutions such as the former Corinthian College and ITT Tech.

Now add the new kid on the block, Westwood College. A week after Biden’s discount plan was announced, the Department of Education announced a separate $1.5 billion debt relief package for 79,000 borrowers who attended the since-closed Westwood College. 2016.

“Westwood exploited a culture of false promises, lies and manipulation in order to profit from student debt that plagued borrowers long after Westwood closed,” Education Undersecretary James Kvaal said in a statement. communicated.

Along with evidence from state attorneys general in Colorado and Illinois, the Department of Education described how Westwood “regularly misled prospective students by grossly misrepresenting that his degrees would benefit their career prospects and potential. income”.

Specifically, Westwood promised students jobs in their fields within six months of graduation that would “make them employable for the rest of their lives.” Everything was swollen. As a guarantee of employment. The department found no evidence the school ever followed up.

Tackling specific cases like Westwood shows where the egregious abusers are. It’s a small group of people. And practitioners in the field should all get the message.

In the Westwood College example, the school was run by Alta College but acquired in 2002 by a private equity firm. George Burnett was co-founder of Alta and being acquired was like a feather in his cap. He was named president of the University of Phoenix earlier this year. But Burnett quit the post shortly after Department of Education officials began investigating more deeply what happened at Westwood.

The Westwood case now brings the Department of Education’s success rate in exposing predatory college practices to a staggering $14.5 billion in rejections for nearly 1.1 million borrowers.

This is all in addition to the general student loan forgiveness plan announced by Biden that should help not only for-profit borrowers, but also borrowers attending public two- and four-year institutions, as well as traditional private colleges (10 $000 loan cancellation). for those earning $125,000, and an additional $10,000 for Pell Grant recipients).

But for the most part, the real problem with student loans are the education predators, the “private for profit” colleges, which make over 30% of all student loans.

Many of these PFPs took BIPOC students for a ride.

Government and other higher education actors need to do more to expose the for-profit business model, perhaps to reduce the loan income ratio from 90-10 to 70-30. Make schools show that they are more than loan collectors and recruiters. At a minimum, schools must deliver on promises made to their students.

In the meantime, you will hear from people on the left saying that Biden should have canceled more of his student debt. While on the right, people will argue about cost and morals. You just need to point out the real situation of student loans that need reform. Schools that exist to make loans.

They need to understand that students deserve all the loan forgiveness they can get. What about for-profit predators? They deserve our contempt.

Emil Guillermo is a journalist and commentator. He writes for the Asian American Legal Defense and Education Fund. You can follow him on Twitter @emilamok

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As “buy now, pay later” plans grow, so do late payments https://mijasguide.com/as-buy-now-pay-later-plans-grow-so-do-late-payments/ Thu, 15 Sep 2022 03:31:46 +0000 https://mijasguide.com/as-buy-now-pay-later-plans-grow-so-do-late-payments/

NEW YORK (AP) — Americans have become fond of “buy now, pay later” services, but the “pay later” part is becoming increasingly difficult for some borrowers.

Buy now, pay later loans allow users to pay for items such as new sneakers, electronics, or luxury goods in installments. Companies such as Affirm, Afterpay, Klarna, and PayPal have created popular financial products around these short-term loans, especially for young borrowers who fear endless credit card debt.

Now, as the industry accumulates customers, chargebacks are on the rise. Inflation squeezes consumers, making it harder to pay off debt. Some borrowers do not budget properly, especially if persuaded to take out multiple loans, while others may have been credit risks to begin with.

“You have an industry with a higher concentration of subprime borrowers in a market that hasn’t been effectively tested (that kind of economy), and you have a kind of toxic brew of worries,” Michael Taiano said. , an analyst at Fitch Ratings, who co-authored a report in July highlighting some of the industry’s concerns.

The most popular type of buy now, pay later loan allows for four payments over six weeks – one payment at the time of purchase and three more that borrowers often try to synchronize with pay periods. Longer term loans for larger purchases are also available. Most short-term loans bear no interest. Companies that charge interest can clearly state in advance how much a borrower will pay in finance charges.

Given these characteristics, consumer advocates and financial advisors initially saw buy now, pay later plans as a potentially healthier form of consumer debt if used correctly. The main concern was late fees, which could be a heavy financial burden on a small purchase if a borrower was late on a payment. Fees can reach $34, plus interest. But now that chargebacks are on the rise and companies are more aggressive in marketing their products, advocates see the need for additional regulation.

The industry is showing growth rates not typically found in financial services. Klarna customers purchased $41 billion worth of products on its service globally in the first six months of the year. up 21% from a year ago. PayPal’s revenue from its buy-it-now and pay-later services more than tripled in the second quarter to $4.9 billion.

Jasmine Francis, 29, a technology analyst based in Charlotte, North Carolina, said she first used a ‘buy now, pay later’ service in 2018 to buy clothes from the fast fashion brand Forever21.

“I remember I just got a cart,” she said. “At first I thought, ‘Something has to go back’, then I saw Afterpay at checkout – you don’t pay for everything right now, but you get it right away. It was from music to my ears.

It is unclear to what extent clients are using buy now, pay later loans healthily. Fitch found that chargebacks on these services rose sharply in the 12 months to March 31, while chargebacks on credit cards remained stable – although chargebacks at AfterPay, which focuses primarily on cash loans. short term, have fallen slightly over the past two quarters.

Credit-reporting firm TransUnion found that borrowers are using buy-it-now, pay-later plans, even as they rack up credit card debt as well. A Morning Consult poll released this week found that 15% of buy now, pay later customers use the service for routine purchases, such as groceries and gas, a pattern of behavior that is ringing alarm bells at home. financial advisers.

“If these buy now, pay later plans aren’t budgeted properly, they can have a cascading impact on a person’s entire financial life,” said André Jean-Pierre, a former Morgan Stanley wealth adviser who now runs his own financial planning company focused on helping black Americans save and budget properly.

Another concern of consumer advisors and advocates, as well as lawmakers and regulators in Washington, is the ease with which consumers can layer on these installment loans.

Speaking at a Tuesday Senate Banking Committee hearing on new financial products, Sen. Sherrod Brown, D-Ohio, highlighted the benefits of plans that allow consumers to pay for things in installments. But he also criticized the way the industry promotes the plans.

“The ads encourage consumers to use these plans for multiple purchases, across multiple online stores — racking up debt they can’t afford to pay off,” Brown said.

Short-term loans are potentially problematic because they are not reported on a consumer’s credit profile with Transunion and Experian. Additionally, buy now, pay later, industry customers are young – meaning they have little credit history to begin with. In theory, a borrower could take out multiple short-term loans across multiple buy-now, pay-later businesses — a practice known as “loan stacking” — and they would never show up on a credit report. If a person puts in too many buy now, pay later items, budgeting can be difficult.

“It’s a blind spot for the industry,” Fitch’s Taiano said.

The industry trade group buy now, pay later has pushed back on the characterization that its products could burden borrowers with too much debt.

“With zero to low interest rates, flexible payment terms and transparent terms and conditions, BNPL helps consumers manage their cash responsibly and live healthier financial lives,” said Penny Lee, CEO of the Financial Technology Association, in a statement.

The Consumer Financial Protection Bureau is studying the popularity of buy now, pay loans later and is expected to release a report soon with its findings.

Francis, the technology analyst, said it has become common for his friends to pay for their trips with installment loans, so as not to completely empty their bank accounts in an emergency.

“If I come back from vacation and I have two flat tires, and I just spent all that money on plane tickets, that’s $400 that you don’t have right now,” he said. she stated. “Most people don’t have savings. They’ve got just enough for those flat tires.

Meanwhile, providers of buy-it-pay-later services see rising chargebacks as a natural consequence of growth, but also an indication that inflation is hitting the Americans most likely to use these services the most. harder.

“I wouldn’t call it some kind of preamble to a potential slowdown, but it’s not the same kind of smooth sailing that it’s been,” said Max Levchin, Founder and CEO of Affirm, the one of the biggest buy now, pay later companies. Levchin said Affirm takes a more conservative approach to lending.

Despite concerns, the consensus is buy now, pay later, companies are here to stay. Affirm, Klarna, Afterpay, which is owned by Block Inc., as well as PayPal and others are now widely integrated into internet commerce.

Moreover, the growth of the industry attracts more and more players. Tech titan Apple announced earlier this summer Apple Pay Later, where users can make purchases on a four-payment plan over six weeks.

“I usually schedule the purchases I make using PayPal ‘Pay in 4’ so that my due dates for purchases land on my payment dates because due dates are every two weeks” , said Desiree Moore, 35, of Georgia.

Moore said she tries to use buy-it-now, pay-later plans to cover purchases that aren’t part of her usual monthly budget, so as not to take money away from her children’s needs. She is increasingly using the plans with inflation making items more expensive and so far able to keep up with the payments.

Buy now, pay later took off in the United States after the Great Recession. Analysts said the product was largely untested during a major period of financial hardship, unlike mortgages, credit cards or auto loans. Even financial executives have recognized the new challenges facing the industry.

“We’ve seen some stress (among those with the lowest credit scores), and those are starting to struggle.” said Levchin.

___

AP Personal Finance Reporter Cora Lewis contributed to this report from New York.

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RefiJet announces new technology to help customers get loans faster https://mijasguide.com/refijet-announces-new-technology-to-help-customers-get-loans-faster/ Tue, 13 Sep 2022 15:17:38 +0000 https://mijasguide.com/refijet-announces-new-technology-to-help-customers-get-loans-faster/

DENVER, CO/ACCESSWIRE/September 13, 2022/ RefiJet, one of the nation’s fastest growing auto loan refinance companies, has just made it easier for customers to apply for a loan, thanks to the new “digital journey” in its refinance process.

Now, those looking for an auto loan can simply enter application data online to receive offers quickly. They can get approved and begin loan formalities in a process that limits the time it typically takes to speak with a representative.

“As our business has grown over the past few years, we have made a major commitment to improving the digital experience for our customers,” said Reid Rubenstein, co-founder and managing partner of RefiJet. “These enhancements not only simplify the refinancing process for consumers, but also create a more efficient connection between borrowers and our lending partners.”

Customers can enter information from their desktop, laptop, or even their phone. In just a few minutes, they will be able to consult the loan offers.

RefiJet continues to expand its digital journey, making more and more stages of the application process available online, with the aim of making the experience as seamless as possible for its customers.

“We recognize that some consumers do not have access to the internet or may not be comfortable using it, so customers will always have the option of submitting their claim over the phone with the assistance of a representative. customer service,” Rubenstein said. “It’s essential that we make the process as efficient and comfortable for everyone, however they choose to apply.”

At RefiJet, securing and protecting customer data is of the utmost importance. This information is always encrypted and cannot be transferred outside the system. Only authorized personnel will have access. A secure portal allows customers to send and receive documents without security concerns. RefiJet continuously evaluates its systems and security and invests to ensure that all parties are as protected as possible.

About RefiJet

Denver, Colorado-based RefiJet offers a nationwide vehicle loan refinance program for consumers of different credit levels who want to refinance to reduce a monthly payment, lower the interest rate, or get a better loan structure. ready. He works with a variety of lenders, so he specializes in giving consumers the best deal they qualify for.

For more information, visit www.refijet.com and www.yieldsolutionsgroup.com.

Media Contact:

Michael Singer
919-439-4731
[email protected]

THE SOURCE: RefiJet

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Former Los Angeles woman charged with arranging 110 fraudulent PPP loans https://mijasguide.com/former-los-angeles-woman-charged-with-arranging-110-fraudulent-ppp-loans/ Sun, 11 Sep 2022 22:55:01 +0000 https://mijasguide.com/former-los-angeles-woman-charged-with-arranging-110-fraudulent-ppp-loans/

U.S. Attorney Duane A. Evans today announced the indictment of Sharnae Every, 27, of Houston, charged with one count of conspiracy to commit mail fraud and two counts of mail fraud.

The case against each began following a referral from the Accountability Committee in Response to the COVID-19 Pandemic regarding possible fraudulent Paycheck Protection Program loans. Investigators determined that there were at least 110 PPP sole proprietor loan applications in and around the Thibodeaux area and that they all had the same federal tax bills and forms with the same business name and amounts.

According to the indictment, Every created a fictitious business called “Natural Hair Afro, LLC, Houma, LA 70360” and used this fictitious business name on nearly all fraudulent PPP loan applications. Each advertisement under various aliases on Facebook to recruit individuals to obtain money from the PPP program. All fake and fraudulent PPP Sole Proprietor Loan applications prepared and submitted through various online portals including but not limited to Blueacorn. Each created all fake and fraudulent invoices, bank statements and schedules. Each falsely certified that the applications and information provided in the supporting documents were true and accurate when electronically submitting the fraudulent PPP loan applications.

Each charged $45 to $120 from the people they recruited to prepare and submit the fraudulent PPP application. Each Cash app primarily used to receive initial payments. Each then charged around $3,500 once the loans were funded. Each received these funds in her Cash App account or in her boyfriend’s checking account.

If convicted, Every faces a maximum sentence of 20 years, followed by a period of supervised release of up to three years, a fine of up to $250,000, or double the gross gain for the defendant, or double the gross loss for any victim, and a mandatory special assessment fee of $100.00, per count.

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Freddie Mac assesses securitization of approximately $536 million in reproductive loans https://mijasguide.com/freddie-mac-assesses-securitization-of-approximately-536-million-in-reproductive-loans/ Fri, 09 Sep 2022 14:06:28 +0000 https://mijasguide.com/freddie-mac-assesses-securitization-of-approximately-536-million-in-reproductive-loans/

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MCLEAN, Va., Sept. 09, 2022 (GLOBE NEWSWIRE) — Freddie Mac (OTCQB: FMCC) today announced pricing for its second Seasoned Credit Risk Transfer Trust (SCRT) offering of 2022, a securitization of approximately $536 million comprised of both senior secured and subordinated unsecured securities backed by a Seasoned Recurring Lending (RPL) pool. The SCRT program is a fundamental part of Freddie Mac’s seasoned lending offerings that reduce less liquid assets in its mortgage-related investment portfolio and eliminate credit and market risk through economically sensible transactions.

Freddie Mac Seasoned Credit Risk Transfer Trust, Series 2022-2 includes approximately $492 million in senior secured certificates and $45 million in mezzanine and subordinated unsecured certificates. Mezzanine certificates will be rated. The transaction is expected to settle on September 14, 2022. The underlying collateral consists of 3,105 seasoned fixed, step-up and adjustable rate RPLs, and includes both loans that have been modified to help borrowers at risk of foreclosure and loans that have never been modified. On the Closing Date, the assets of the Trust will consist of Recurring and Performing Mortgages which, as of the Cut-Off Date, are either outstanding or less than 30 days past due under the MBA method.

From the date of closing, the mortgages will be serviced by Select Portfolio Servicing, Inc. and will be serviced in accordance with requirements which, in the event of default, prioritize borrower retention options and promote neighborhood stability.

Advisors to this transaction are JP Morgan Securities LLC and Wells Fargo Securities LLC, as joint lead managers and joint bookrunners, and BofA Securities, Inc., Citigroup Global Markets Inc., Nomura Securities International, Inc. and Academy Securities Inc. (a company owned by disabled veterans), as co-managers.

To date, Freddie Mac has sold over $9.7 billion in non-performing loans (NPLs) and securitized over $76 billion in RPLs comprising over $30 billion in fully collateralized PCs, $34 billion in senior/sub SCRT titles and $12 billion of seasoned titles. Structured Lending Transaction Securities (SLST). Additional information about the company’s seasoned loan offerings can be found at: http://www.freddiemac.com/seasonedloanofferings/

This announcement is not an offer to sell Freddie Mac securities. Offers for any given security are made only through applicable offering circulars and related supplements, which incorporate Freddie Mac’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission (SEC) on February 10, 2022; all other reports that Freddie Mac has filed with the SEC pursuant to Section 13(a) of the Securities Exchange Act of 1934 (Exchange Act) since December 31, 2021, excluding any information “provided” at the SEC on Form 8-K; and all documents that Freddie Mac files with the SEC pursuant to Sections 13(a), 13(c) or 14 of the Exchange Act, excluding any information “provided” to the SEC on Form 8- K.

Freddie Mac press releases sometimes contain forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties, some of which are beyond the company’s control. Management’s expectations for the future of the company necessarily involve a number of assumptions, judgments and estimates, and a variety of factors could cause actual results to differ materially from the expectations expressed in such forward-looking statements and ‘others. These assumptions, judgments, estimates and factors are discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, and its reports on Form 10-Q and Form 8-K, which are available at Investor Relations website. Company website page at www.FreddieMac.com/investors and SEC website at www.sec.gov. The company undertakes no obligation to update any forward-looking statements it makes to reflect events or circumstances that occur after the date of this press release.

The financial and other information contained in the documents accessible on this page speaks only as of the date of these documents. The information may be outdated and no longer accurate. Freddie Mac assumes no obligation and disclaims any obligation to update the information contained in these documents.

Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our founding by Congress in 1970, we have made housing more accessible and affordable for buyers and renters in communities nationwide. We are building a better housing finance system for buyers, renters, lenders and ratepayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac’s blog, FreddieMac.com/blog.

MEDIA CONTACT: Fred Salomon 703-903-3861[email protected]

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Source: Freddie Mac

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Blunt: Student loan document and tax-and-spending frenzy add billions to cost of Obamacare https://mijasguide.com/blunt-student-loan-document-and-tax-and-spending-frenzy-add-billions-to-cost-of-obamacare/ Wed, 07 Sep 2022 23:04:57 +0000 https://mijasguide.com/blunt-student-loan-document-and-tax-and-spending-frenzy-add-billions-to-cost-of-obamacare/

WASHINGTON — At the weekly Republican leadership press conference today, U.S. Sen. Roy Blunt (Mo.) explained how the Democrats’ student loan and tax and spending spree will dramatically increase the cost of Obamacare. As Blunt noted, Democrats recently passed partisan legislation that spends billions to subsidize Obamacare coverage for high-income earners. On top of that, President Biden’s student loan undermines one of the biggest sources of revenue Democrats say would help pay for Obamacare.

Here are Blunt’s remarks:

“Well, our friends across the way, in the bill they passed just before we left, the reconciliation bill, decided that the government could run the health and pharmaceutical system better than the people couldn’t in a competitive market.

“Just a few years ago they decided they could do a better job with the healthcare system with the so-called Affordable Care Act, which turned out to be not very affordable at all. One of the ways to make it affordable was to withdraw student loans from the private sector with a government guarantee. And the government would collect student loans, and student loan interest would fund Obamacare.

“Well, I said at the time and others have too, this is the beginning of the end for an effective student loan program. Once you instruct the government to collect the loans, the loans won’t be collected like they were before, and so they proved it. They also proved, by the way, in the reconciliation bill that Obamacare doesn’t work any other way because one of the big hundreds of billions of dollars of spending in that bill was to subsidize people earning up to $400,000 who could not afford affordable insurance under the current Affordable Care Act system.

“It turned out that the Affordable Care Act was not very affordable at all. And it’s not affordable when the government comes in and takes out the competitive market, or decides that the competitive market is working so well, that we could handle this as well as the competitive market was, only to find that a decade later we decided that we were just going to cancel all loans because it is easier to cancel loans than to recover loans.

“And as Senator Thune said, for people who didn’t go to college because they couldn’t afford it, or people who got a certificate that was helpful for them to find a job, but no grants or loans were available for those kinds of programs, or people who went straight to work, or people who repaid their loans, these are the people who are now responsible for somewhere between 600 billions and trillions of dollars that have just been transferred from the revenue side of the government balance sheet to the debt side of the government balance sheet.

“Incredibly unfair, incredibly myopic. If you look at what just happened and you think people are going to be rushing to pay off their student loans in the future you just don’t think how people react to this kind of government irresponsibility .

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