Citing prepayment speeds at multi-year lows, Spector noted those volumes continued to drive the organic growth of the company’s servicing portfolio, which ended the quarter at more than $576 billion in unpaid principal balance. Inflationary market blamed for quarterly performance Spector blamed the various inflation-induced dynamics for the lowered gains from last year: “With mortgage … [Read more…]
ANALYSIS: If your home loan has come to the end of its fixed term and you’re facing refixing from a rate about 2.5% to one more like 6.7%, it might sting a bit.
But spare a thought for those borrowers who are now facing much higher rates.
Here are some of the ways that people are facing interest rates near double-digits, in some cases.
If you bought a house recently using a small deposit, and its value has either fallen or not moved, you face a double blow.
In this situation, borrowers usually do not qualify for banks’ “special” home loan rates, and they are also often charged a low-equity fee or premium on top.
How that works depends on which bank you are with – some charge an upfront, one-off fee. Others apply a margin to the interest rate.
The extent of that depends on how small your deposit is. Someone with a 10% deposit could face an extra 75 basis points being applied to their home loan rate. At the moment, that would mean a standard interest rate of 7.39% for two years, plus 75 basis points of margin, taking them to a total rate of 8.14%.
Between January 2020 and October 2021, when the official cash rate started to lift, there was about $15 billion in home loan lending done via more than 31,000 loans to people with equity of less than 20%.
Are you stuck with a high interest rate? Email [email protected]
When house prices are rising quickly, buyers often plan to have their properties revalued in the future to have the margin removed and allow them to access better rates. But when the market turns, as it has since 2021, that strategy becomes less possible.
Mortgage adviser Hamish Patel, of Mortgages Online, said he had dealt with a few clients in that position.
He said, when the banks were competing hard for business, some had offered low-deposit borrowers their special rates, plus the margin. But then when they came to refix, the bank’s appetite to offer the special was gone and they had to settle for a standard rate.
He had one client who bought a townhouse in Auckland for $1.05 million. But when it was revalued recently, its value had dropped to $950,000. She had a loan of $900,000.
STUFF
Susan Edmunds speaks with four mortgage advisers what how best to prepare yourself financially when buying a home.
That left her with limited options, he said. People with 10% or 15% equity could change to a different bank because the loan-to-value rules allowed banks to refinance clients dollar-for-dollar without it counting towards the total low-deposit lending they were allowed to do. But when someone’s equity dropped to 5%, it was virtually impossible, he said.
“Theoretically, ANZ will do 95% but the low-equity fees are large so it makes no sense to do it.”
ANZ’s website notes that when someone has less than 10% equity, the low-equity premium applied is equal to 2% of the loan amount.
“There are people who kind of a year ago thought they might be paying 6% to 6.5% when they refixed – not up near 8% with a margin. That’s surprising.”
He said it was also tricky for those borrowers because shorter-term rates were more expensive than longer fixes, but many were reluctant to lock themselves in.
Another home loan adviser, Susan Templeton, agreed buyers who purchased houses at the peak of the market would be stuck with a low-equity margin longer than anticipated.
“First, ask your mortgage adviser for a desktop valuation to get a fix on where you stand. If that doesn’t fly, you can pay for a registered valuation and hope for the best. It’s worth having a conversation about your timing and current market trends. If you have the means, consider paying down your mortgage or upgrading your home to raise the value, or changing banks. Each option has potential consequences.”
She said borrowers should talk to a mortgage adviser who understood their financial position and goals.
Glen McLeod, from Edge Mortgages, said he was also seeing people running into trouble with second-tier, non-bank lenders.
He said they were often used by buyers whose businesses were affected by Covid and did not have the financial history to get a traditional home loan.
“Fast forward to where we are now and sadly interest rates have increased and with the second-tier providers if they were on a fixed rate at the time they are coming off with interest rates being in the late 9%, early 10% range. This is indeed causing financial stress particularly if they are on principal and interest based lending.
“We have a number of cases been able to refinance the client back to the mainstream however there are cases where it is not possible. This is due to either the value of the property reducing or income to service not working because of the increase in the serviceability rates with the mainstream banks.
“In these cases what we’ve had to do is apply back to the existing provider to see if we can get an interest only payment regime put in place. This is to give a small reduction and payments over the next 12 to 24 months.”
Source: i.stuff.co.nz
Dusaan, an Indian homegrown marketplace that provides premium home decor at affordable prices, have 150+ brands, including 10+ international brands across 40+ categories under their umbrella and are only expanding further.
Simran Kohli, the Founder of Dusaan Retail Technologies, promotes Dusaan as a destination for affordable, premium home furnishings. She started her career at McKinsey and Company – working on coveted clients in finance and banking, private equity, and industrials. She later became an investor at Sequoia Capital and focused on early-stage consumer companies, and eventually started her own company.
Also read: The Art of Symmetry: European Classical Interiors
Her vision for Dusaan Retail Technologies is to make the user’s experience easy and smooth when shopping for their home, and for the marketplace to become the go-to destination for everything home. She aims at doing that by providing all home furnishings in one space.
It was co-founded with Moulshree Aggarwal, (both founders were ex VCs) after seeing a wave of opportunity in the home furnishings industry. Within six months of making the brand operational, they now have thousands of happy customers and more than 15,000 products listed on the marketplace. There are more than 150+ coveted brands listed on Dusaan, which includes top international names as well.
Simran Kohli, , the Founder of Dusaan Retail Technologies, speaks to Indulge about what make the e-commerce platform unique, inspiration behind the venture, future plans and more.
What makes Dusaan unique when compared to other e-commerce platforms?
Dusaan is a meticulously established and unique platform that deeply comprehends the special bond you share with your home. With us, you can explore a handpicked selection of top-notch brands from all over India, allowing you to bring home products that resonate with your style and preferences. Dusaan prides itself on its distinctive blend of convenience, rigorous quality checks, and thoughtful curation, setting it apart from the rest. Given that not everyone has home decor expertise, Dusaan helps customers design their classic living spaces entrancingly.
What was the inspiration behind this venture?
The home decor industry is a $10 billion industry and growing, yet 85% of it is still unorganised. More than just a place to live, a person’s home is also a blank canvas on which they can showcase their artistic flair. At Dusaan, we want to provide a one-stop destination for all things home. Curating a home should be a joyful experience, but it ends up being a hectic one. Thus, we aim to bring the best quality products to all homeowners at affordable prices while also spoiling them with amazing choices. It’s a truly personalised design journey that will make your space a true reflection of your taste and personality. It can be started by visiting the Dusaan website, where you will find an unrivalled selection of home furnishings and decor items.
Did you face any challenges?
There are unique challenges that come with being a novice in the field. Firstly, acquiring new customers for the platform and then converting them into loyal customers; secondly, bringing on reliable, high-calibre vendors. The home decor industry can be difficult because there are many well-established businesses and new competitors who are constantly vying for market share. However, keeping in mind the various expectations and preferences of customers in this field, we are willing to offer comprehensive solutions to these challenges and provide clients with the best products accessible.
In your opinion, what are the must-have features of a great e-commerce platform?
To provide your clients with a fantastic shopping experience, your e-commerce platform absolutely must possess the qualities listed below.
● Simplified navigation: Online shopping should be an easy experience, as the customer has shown interest and is spending time going through the platform. The homepage, catalogue, product page, etc. should be easy to navigate for customers to find exactly what they are looking for.
● Wide collection: A wide collection is essential for e-commerce because it caters to diverse preferences, meets customer expectations, enhances satisfaction, capitalises on trends, and provides a competitive advantage. It also offers cross-selling opportunities, addresses seasonal demand, and facilitates international reach while providing valuable data insights for informed decision-making.
What are some of the unique brands that are featured at your site?
● Joseph Joseph: Born in 2003 in England, Joseph Joseph has simple, brilliant, and thoughtful designs that make daily tasks faster and more efficient. From kitchen tools to kitchen organisation, one can unlock much superior performance by using them.
● Madehome: It’s a sustainable kitchenware brand that curates products with natural materials like neem wood. The brand aims to bring customers back to their roots and enjoy wholesome serveware.
● House of Banjara: The House of Banjara is the essence of Boho living with artisanal decor, creating a truly sophisticated and unique experience for your home. Their curated collection embodies the Bohemian spirit, blending intricate craftsmanship with contemporary aesthetics to offer a diverse range of sophisticated decor pieces.
● Ministry of Decor: The Ministry of Decor provides carefully crafted and manufactured home decor products through a team of experts in innovation, design, aesthetics, and quality. The brand was born with a vision to provide high-end boutique products that won’t burn your pocket.
Which e-commerce trend do you consider essential?
In our opinion, the most significant e-commerce trend that we consider essential is curation, which allows online retailers to tailor product offerings to individual customer preferences. With the overwhelming number of products available online, customers often face decision fatigue and information overload. Curation helps streamline the shopping process by presenting a thoughtfully selected collection of products, making it easier for customers to find what they are looking for quickly.
Also read: IKEA’s new collection MAVINN brings sustainable home decor and furnishings
Are you doing something special on handloom day?
We’ll put together a unique assortment of handloom goods, such as rugs, table runners, floor mats, etc. This collection will be prominently featured on our online storefronts. In addition to celebrating Handloom Day, we also want to show our consumers how much we value them and their choices and emphasise how important the handloom industry is to the socioeconomic development of the entire country. As a home decor company, we cherish and believe in the beauty of handloom textiles, and we want to pass this legacy on to future generations.
Source: indulgexpress.com
If you live in a typical American household, 66% of which own a pet, you know the many benefits of being a pet parent. Pets provide companionship, reduce stress and even improve your health. Pet owners, especially those with dogs, are more likely to get outside and take a stroll through the park. So what could be the down side?
Although the benefits outweigh the costs, pets are expensive. It’s important to take a close look at the financial side of pet ownership before you add a new member to the family. Even if you’ve considered the adoption fee and supplies, the ongoing costs of food, grooming, and routine vet bills add up.
If you’re financially savvy, you may have looked into ways to save on pet food or perform at-home pet pedicures, but veterinary visits can add up. Scheduling routine physicals and keeping up to date on vaccines is the best preventative measure against future health conditions that may be costly to treat. Emergency medical care can leave even the most prepared pet owner in a mountain of debt. Or in the worst cases, economic euthanasia—a heartbreaking decision for any family.
Most people agree that the unconditional love of a pet is worth any amount of money. Still, preparing for the true cost of pet ownership can help you plan your budget. Pets become a part of the family, and making sure you can afford one can help you avoid tough decisions down the road. Fortunately, if you plan ahead, you can maintain the health of your pet and your finances.
Based on the average life span of 12 years, the lifetime cost of owning a dog can range from $20,000 to over $55,000. Studies show about half of all pet owners underestimate the cost of raising a pet. Before purchasing a dog, it’s important to understand both the initial cost of bringing a dog into your home and the ongoing annual expenses of raising a dog.
Note: Expenses and costs are possible ranges
Aside from emergency care, most major expenses occur in the first year. New pet owners can expect to shell out nearly $400 for the bare necessities alone. Depending on the specific breed and size of dog, these costs could range well over $2,000. Below is a look at some initial costs you can expect to incur.
Total one-time expenses: $420 to $2,180
In some cases, puppies can be more expensive than healthy adult dogs, since they need more shots and veterinary procedures. They may also require obedience training due to their boundless energy and tendency to chew on household items.
How much do dogs cost per year? According to the ASPCA, the average pet owner spends nearly $1,400 annually on their furry pal. However, other sources put this number much higher.
Below is a look at some of the expenses you can expect to incur every year you have a dog. If you have multiple dogs, these costs will be a lot more.
Total average cost of owning a dog per year: $773 to $1,848
In addition to the basics, such as food and veterinary care, other routine and unexpected expenses will arise. You’ll also need to consider pet-related costs that come along with life events, such as travel and moving. For instance, many apartments charge a pet deposit. You also may need to pay additional cleaning fees.
While raising your dog is a significant investment, most pet owners feel it’s money well spent. After all, you get paid back with unconditional love and affection.
Cats may be less expensive to own than dogs, but even these lower-maintenance creatures can put a dent in your bank account. For one reason, cats tend to live longer than dogs—they have a life span of about 15 years. Additionally, 44% of cat owners have more than one cat, compared to just 35% of dog owners. The average lifetime cost of owning a cat can range from $12,000 to $26,000.
The biggest factor affecting the life span and total expenses of a cat is whether it lives indoors or outdoors. An outdoor cat has a much shorter life span—only five years on average—and is at greater risk of injury from other animals, traffic, and diseases. If you plan to let your cat outdoors, lower your financial risk by vaccinating against diseases and purchasing pet insurance to cover potential injuries.
You also want to ensure it’s not illegal to let your cat roam outside in your area. If your beloved cat ends up at animal control, you’ll have to pay a fee to get it back.
As with dogs, the initial expenses of cat ownership are the highest. You can expect to pay up to $1,000 when buying a cat.
Total one-time expenses: $355 to $965
Of course, cats aren’t always predictable. You may have a certain cat food in mind—one that fits your budget—but that doesn’t mean your cat will like it. Cats can also be particular about the type of litter they use. Still, the following ranges give you an idea of what to expect in the years ahead.
Total annual cost to own a cat: $788 to $1,693
Cats have a penchant for knocking things off tables, and they don’t differentiate between empty toilet paper rolls and expensive vases. Additionally, they have sharp claws, and if you don’t give them someplace to scratch, they may turn your furniture into a shredding post. This is all to say you may want to set aside money for miscellaneous expenses.
Here are some other extras you may want to consider:
Pet costs can quickly get out of hand if you’re not careful. Fortunately, you can do several things to save money on care for your pets.
Unless you’re a breeder, having your pet spayed or neutered should be one of your top priorities. Not only can this step help you save money in the long run, but it can also prevent unwanted litters of puppies or kittens.
Setting a budget for your pet expenses can help you avoid spending too much on unnecessary purchases. Start by tracking how much you spend per month on pet care expenses. Use this information to set your budget for these costs.
You can save a significant amount of money throughout the year by purchasing your pet food and treats in bulk. With proper storage, many types of pet food have a shelf life of up to 18 months.
The best way to keep your pet’s medical expenses down is to invest in preventive care. Scheduling regular checkups, including dental care, and ensuring your pet is up to date on all necessary shots, including heartworm and vaccines against fleas and ticks, can avoid costly medical charges later.
Instead of paying anywhere from $200 to $400 for professional grooming services, you can groom your pet at home. Once you purchase the original supplies, which can cost around $50, you can groom your pet at home for significantly less money.
Consider purchasing your pet supplies using a cash-back rewards credit card. This step can help you save money by earning cash back on your everyday purchases.
One step that can make the cost of pet ownership more affordable is pet insurance. The right insurance plan can help cover some of your pet’s medical expenses. This, in turn, can reduce your out-of-pocket expenses.
Pet insurance can also give you peace of mind knowing that if your pet requires unexpected medical care, some costs may be covered. It’s important to realize not all pet insurance policies are alike. Be sure to carefully read the benefits and exclusions for each policy to ensure you select the one that’s right for your situation.
When you bring home your new fur baby, the last thing you want to think about is a tragedy or major illness hitting them, but it’s important to be prepared. Even if you establish healthy habits such as regular exercise, you should plan ahead for unexpected veterinary bills.
Once you become a pet parent, you may find that you’ll do anything for your canine or feline companion, even risking your credit to save their lives. While many pet owners feel that their pet’s well-being is worth the necessary sacrifices, setting aside money for a rainy day can help deflect some of the costs of an emergency procedure or unexpected illness.
Putting money aside for unexpected pet expenses is a good idea, but it’s difficult to save enough to cover a major medical bill—especially if you’re paying off existing debt at the same time. A diagnostic procedure alone can cost up to $2,000. And common medical conditions, such as orthopedic surgery or removing a foreign body can cost $7,000. If your pet has a chronic condition requiring regular follow-up visits or medications, your pet could rack up tens of thousands of dollars in medical expenses.
Rather than set yourself up to be forced to decide between your financial health and your pet’s health, plan for the worst by taking out pet insurance. With ongoing expenses adding up, it’s tempting to cut corners by skipping pet insurance, but the peace of mind it will give you is invaluable.
Advance planning, such as signing up for health insurance or contributing to a savings account with your pet in mind, can help keep you out of financial water. But there are other ways to make pet ownership affordable and keep costs down.
Consider whether you’re willing to cut back in other areas
Being a responsible pet owner requires sacrifices of your time and sometimes, your finances. You may need to reconsider your morning latte once you’re splurging on treats for your new best friend.
It takes a village
Pet sitting or boarding can cost you $15 to $60 a day, but asking for help from friends and neighbors can save you money, even if you offer to pay for their time.
Search out low-cost clinics for routine pet care
Animal welfare organizations often offer low-cost vaccinations, spaying, and neutering, saving you money both now and in the long run by helping prevent costly medical conditions. Check with your local humane society or local pet rescue groups to get more information.
Prevention can be the most effective tool for avoiding surprise pet costs. Regular exams help detect problems earlier making them less expensive and more likely to have a positive outcome. For example, spaying/neutering your pets reduces their risk of certain cancers.
If you can’t afford an expensive but necessary medical procedure, you may be able to get financial assistance from veterinary medical colleges or non-profit organizations. The American Veterinary Medical Association has a list of organizations that offer aid to pet owners with financial needs. This list is by no means comprehensive, so if you don’t find an option there, keep looking.
While you don’t want to rely on credit cards alone to cover the cost of owning a pet, choosing the right card can help you earn cash back and rewards points on pet-related purchases you’re already making. Some even offer 0% financing, which is useful for transferring a hefty vet bill from an existing card to a new one. Depending on whether you plan to use the card for pet purchases alone or everyday spending will help you determine which card is best for you.
If you’re considering bringing a furry friend home, make sure your credit is in good standing first. A credit card that rewards pet purchases can make it more affordable to own a pet. You’ll want to check your credit scores to know where your credit stands before you apply, so you can reduce the risk of a rejected application and come up with a plan to work your way toward better credit if necessary.
Sources:
Source: credit.com
Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations.
Can you pay a loan with a credit card? Yes, paying a loan with a credit card is sometimes possible. Yet, whether or not you can do so depends on factors such as the lender’s policies or the type of loan you want to pay off.
Are you looking for a creative way to pay off your loans? If you hope to get extra travel points while reducing your monthly payments, you might wonder, “Can you pay a loan with a credit card?”
This post will delve into the types of loans you can pay off with a credit card and the pros and cons of making these payments.
In This Piece:
Whether or not you can pay a loan with a credit card depends on various factors, including the lender’s policies and the type of loan you wish to pay off.
While some lenders may allow credit card payments, others may not accept them. Understanding the terms and conditions of your loan agreement before attempting to pay it off with a credit card is crucial.
You can use credit cards to pay off different loan types, providing flexibility and potential benefits. Here are some common types of loans you can typically pay with a credit card:
Using a credit card to pay off loans has its own advantages and disadvantages. Let’s explore both sides to help you make an informed decision.
Then, is it a good idea to pay a loan with a credit card? It depends on your unique circumstances. It can be advantageous in certain situations, such as consolidating high-interest debts or taking advantage of rewards programs.
However, it’s crucial to consider the interest rates, fees, and potential impact on your credit score. Assessing your financial goals and consulting with an advisor can help determine if this approach aligns with your financial well-being.
If you’ve decided to pay off a loan with a credit card, follow these steps:
Many questions come up regarding paying loans with a credit card, but there are four common questions people always seek answers for. Let us take a look.
In most cases, paying your mortgage with a credit card is impossible. Mortgage lenders typically require payments through bank transfers, checks, or online bill payment methods. However, you may be able to indirectly use a credit card by utilizing balance transfer checks or money transfer services to pay off a mortgage. Before considering this option, assessing the fees, interest rates, and credit card terms is essential.
Car loan lenders generally do not accept credit card payments directly. Like mortgage payments, you can typically make car loan payments through bank transfers or other approved payment methods. However, you may be able to use a credit card to indirectly pay off a car loan by employing balance transfer checks or money transfer services. Evaluate the feasibility and costs associated with this approach before proceeding.
Paying student loans with a credit card is usually not possible. Most student loan servicers do not accept credit card payments because they have high transaction fees. However, you can explore alternative options such as balance transfers or personal loans to pay off student loans. It’s crucial to evaluate the interest rates, fees, and terms of these options before proceeding.
While it’s possible to use a credit card to pay off a payday loan, it’s generally not advisable. Payday loans can come with high interest rates, and adding credit card interest can lead to significant debt.
Exploring other alternatives for paying off payday loans is recommended, such as negotiating a repayment plan with the lender or seeking assistance from credit counseling organizations.
In conclusion, paying off a loan with a credit card can be a viable option depending on your specific circumstances. It offers convenience, flexibility, and potential rewards or debt consolidation benefits. However, it’s essential to consider the higher interest rates, fees, and potential impact on your credit score.
Assess your financial situation by consulting with professionals if needed, and ensure that your credit card terms align with your goals. To find the right credit card and loans, visit our credit cards and personal loans. Empower yourself to take control of your credit and achieve your financial well-being.
Source: credit.com
Sales of second homes, otherwise known as vacation properties, slipped 30.8 percent to 512,000 units last year, down from 740,000 in 2007, the National Association of Realtors reported today.
Meanwhile, investment-home property sales slid 17.2 percent to 1.12 million units in 2008, down from 1.35 million a year earlier.
The market share of home purchased for investment stood unchanged at 21 percent, while second home sales accounted for nine percent of total sales, down from 12 percent in 2007.
In 2005, a peak year for speculating (which partially explains how we got into this mess), a staggering 40 percent of homes sales were vacation or investment properties.
“We expected vacation-home sales to fall given the impact of a declining economy on discretionary purchases,” said Lawrence Yun, NAR chief economist, in a release. “A steady share of investment-home sales results from buyers taking advantage of deeply discounted prices in many areas, with a smaller portion of new homes in the sales mix.”
The median price paid for a vacation home was just $150,000 last year, down 23.1 percent from $195,000 a year earlier, while the investment property median slipped 28 percent to $108,000 from $150,000.
“As in the market for primary residences, it appears that many sales of deeply discounted distressed homes are pulling down the median price in the second-home market as well,” Yun said.
Of course, he doesn’t seem too concerned because of an expected influx of eligible buyers is on the horizon.
“Given that most people become interested in buying a second home in their 40s, the bulge of population approaching middle age should drive the second-home market over the next decade.”
Perhaps he’s forgetting that many of these same prospects have seen their savings wiped out by the ongoing mortgage crisis.
NAR’s analysis of U.S. Census bureau data shows there are 8.1 million vacation homes and 40.5 million investment units in the United States, compared with 75.5 million owner-occupied homes.
Sales of primary residences declined 13.2 percent to 3.77 million units in 2008 from 4.34 million in 2007.
(photo: skagman)
Source: thetruthaboutmortgage.com
If you or someone you know has dealt with a collection agency, you know how trying it can be. Debt collection agencies have a long history of harassment and illegal practices. Can a collection agency report to a credit bureau without notifying you? The answer might not be that simple. Knowing illegal debt collection practices can help identify when you’re being treated unfairly.
The Fair Debt Collection Practices Act is a federal law that protects consumers against certain unfair collection practices. It applies to only external or third-party debt collectors and only for personal debts. It does not come into play for creditors collecting their own debts. State laws may provide additional protection.
In its annual report to Congress about debt collection complaints, the Consumer Financial Protection Bureau described collection complaints received by the Federal Trade Commission (FTC).
In 2019, the FTC received 75,200 complaints about debt collectors—down from 84,500 in 2018. A complaint does not mean a law has been broken, and some complaints may result from overseas debt collection scammers who harass consumers.
If the FTC finds the complaint to be valid, the agency can ban parties from participating in debt collection. The FTC keeps an up-to-date list of all prohibited parties.
A collection account can significantly affect credit score. If you’ve been contacted by a collector and are worried your credit is being hurt, it might be a good idea to check your credit scores to see if anything has changed.
Every year the FTC releases a report discussing the six main types of debt collection complaints from consumers. Understanding these complaints gives you a better idea of your rights as a consumer. If you’ve experienced any of these types of actions from a debt collection agency, you can report them to the FTC.
Before we delve in, a quick note: keep in mind that state laws can vary. So whenever we mention the law, we’re specifically referring to the Fair Debt Collection Practices Act (FDCPA).
Percentage of complaints: 45% in 2019
The law: If you don’t think the debt belongs to you, you can send a request in writing within 30 days of receiving the initial notice that you want verification of the debt. You can also request that the debt collector no longer contact you. You may consider making the request in writing so you have proof of the request
Often, this issue arises after identity theft occurs. That’s why it’s essential to keep an eye on your credit report, so you can spot these issues early.
Percentage of complaints: 18% in 2019
The law: Within five days of initially contacting you, the collector must send written notice of the debt and include:
You can file a complaint with the FTC if you believe the debt collector never sent written notice. Most individuals complaining about written notifications (65%) say they didn’t receive adequate information to identify and confirm their ownership of the debt. Additionally, some individuals (30%) complain that their written notice never included their right to dispute the debt.
Percentage of complaints: 12% in 2019
The law: Collectors are not allowed to call repeatedly just to harass you. However, there is no specific number of calls specified in the FDCPA limiting calls they can make within a given period. That’s for the courts to decide. If you think a debt collector is calling too often, start keeping a record of the time of the call and any messages left. Collectors also may not call before 8 a.m. or after 9 p.m. unless you’ve given them permission or at times you’ve told them are inconvenient.
The majority of complaints surrounding communication tactics are about repeated phone calls (55%), foul or abusive language (12%) or calls outside of the allotted times (5%).
Percentage of complaints: 12% in 2019
The law: Collectors can’t threaten a lawsuit, criminal prosecution, wage garnishment, jail time, or a poor credit rating unless they have the legal authority to do so and intend to do so.
The most common complaints in this category in 2019were:
These threats are often in violation of the FDCPA. Usually, collectors must take you to court and win before they can take these kinds of actions—if they even have the right in the first place.
Percentage of complaints: 11% in 2019
The law: Collectors can’t use false statements or representations to try to force consumers to cooperate, including:
These claims are in violation of the FDCPA to make if they are untrue. Sometimes, collectors may be allowed to make a claim if they have taken the consumer to court and received a court-approved judgment.
In 2019, the majority of complaints in this category were for:
Percentage of complaints: 3% in 2019
The law: Collectors can call third parties such as family members, neighbors, friends, or co-workers only once to locate the debtor. When they do, they are not allowed to reveal the debt.. They can only make contact again under specific circumstances.
In 2019, the majority of complaints in this category were for debt collectors who contacted:
The federal Fair Debt Collection Practices Act (FDCPA) limits what debt collectors can do and say when attempting to collect a debt. This law covers mortgages, credit cards, medical debts, and any other debt for personal, family, or household purposes.
Unfortunately, the FDCPA doesn’t cover business debt or debt that is owed to the original creditor rather than a collection agency.
As stated earlier, time and place, harassment, and representation are all factored into this federal act. Debt collectors cannot contact you in an unusual place or at a time they know is inconvenient.
Additionally, if collectors are aware you have sought legal representation for the matter, they must immediately stop direct communication with you and, instead, contact your attorney, except for a few exceptions.
Many people ask, “If a debt is sold to another company do I have to pay?” Once your debt is transferred, you owe the money to the current company rather than the original creditor. However, the new collector must still adhere to all the regular debt collection laws. In addition, the company cannot add interest you didn’t agree to or change any other terms of your original contract.
So, when does this happen? Can collection agencies buy from other collection agencies? Yes. Once your debt crosses a threshold that indicates it’s less likely to be paid, your original creditor will send it to a collection agency. After some time, the collection agency might sell your debt to a debt buyer.
If you do choose to pay off your debt, always make sure you pay the party currently holding your debt.
Another federal law is the Fair Credit Reporting Act. It covers certain financial aspects, including debt being collected and reported on your credit report.
This law protects consumers from unfair, deceptive, or abusive acts or practices by collection agencies or creditors.
If you think a debt collector or collection agency has broken the law while trying to collect a debt, you can:
Whenever you’re dealing with debt, it’s smart to review your credit reports for accuracy, because errors can unnecessarily damage your credit standing. Should the worst case happen, there are ways to dispute credit report errors.
If you’re ready to improve your credit score, you can begin the process of credit repair. Debt sent to a collections agency doesn’t have to ruin your financial life—you can work to fix your credit report with credit repair. ExtraCredit is offering an exclusive discount to one of the leaders in credit repair, so sign up today.
Source: credit.com
An eviction notice is a written statement informing you the landlord believes you’re in violation of the rental agreement. Depending on why you’re being evicted, the type of notice you receive and the state you live in, you may need to vacate the property by a certain time. But if you have an eviction notice in your past, you might be worried about getting approved for a new rental situation.
Find out below what happens if you get evicted, including whether you can or should fight the notice and whether you can get a new rental. As with any situation involving your credit and money, being prepared with knowledge can often make a huge difference in the outcome.
Evictions aren’t included on your credit report, and neither are certain types of public records such as eviction judgments. However, that doesn’t mean an eviction leaves your credit squeaky clean or that potential future landlords won’t know about your eviction history.
First, collection accounts or debts leading up to your eviction do appear on your credit report. If you fell behind on rent and tried to right the situation with a personal loan that you also fell behind on, for example, that could hurt your credit. And if the landlord turned uncollected rents over to a collection agency at any point, that can also negatively impact your score.
An outstanding debt (such a collections account) on your credit report can significantly impact your overall credit score. In fact, your payment history accounts for up to 35% of your credit score. So, just one missed payment, including one missed rent payment, can drop your credit score.
Second, judgments related to evictions are a matter of public record. Future landlords might not see them on your credit report, but they can easily find them by searching court records. Many landlords use tenant-screening services that provide rental backgrounds on prospective tenants, and court records related to evictions are typically included.
If you’re having trouble making your monthly rent payments, consider setting up a budget to track your spending. This step may help you avoid a potential eviction.
No, landlords can’t report evictions to the credit bureaus because these agencies don’t collect this type of information. However, this doesn’t mean future landlords can’t find out about the eviction. Court judgments, including evictions, are public records. This means landlords can still find out if you have an eviction in your past.
While searching public records can be a cumbersome process, many landlords use tenant screening services to conduct background checks on potential tenants. This service makes it easier for landlords to learn about past evictions. So, even though an eviction won’t directly impact your credit, it can affect your ability to rent in the future.
Specific landlord rights vary from state to state, but there are several reasons a landlord may have the right to evict you, including:
Landlords can’t evict tenants without cause. Once a lease is signed, both landlords and tenants are bound to its terms. It’s illegal for landlords to discriminate against their tenants and evict them based on their color, race, gender or national origin.
Additionally, landlords can’t evict tenants as retaliation. For example, your landlord can’t evict you because you complain about property conditions or request repairs.
Yes, you can dispute an eviction. A legal eviction requires a judgment from the courts. Before a judgment is rendered, there must first be a court hearing.
You have the right to attend this court hearing, hire an attorney and present your evidence to the court. It’s important to be present at this hearing because the judge can make a final decision without your input.
If you’re legally evicted from your rental, it won’t be on your credit report. However, any unpaid rent balance that you still owe your landlord can end up on your credit report. If this happens, it’s likely to impact your credit score.
It’s important to pay off this balance as quickly as possible. This step can minimize the impact on your credit score. If there’s an incorrect unpaid rent balance on your credit report, you should take steps to remove that information. You can do this by writing to the credit reporting agencies and providing evidence that the information listed on your report is wrong.
Eviction processes vary by state. Eforms, a site that provides sample eviction notices for landlords, summarizes the eviction process for each state. A good first step is to find out exactly what the process in your state is so you know how to respond appropriately to an eviction.
Eviction notices come in two main types: curable and incurable. Curable notices detail how the landlord thinks you broke the lease agreement and how you can fix it. If you cure the issue, the eviction is retracted. Incurable notices don’t have any fix and simply require that you vacate the premises by a certain date.
A common reason for an eviction notice is that the landlord claims the rent hasn’t been paid. In many cases, this would be a curable eviction notice. If you catch up on your rent, the landlord might not move forward with the eviction.
In many cases, if you don’t respond to the eviction notice to cure it or move out, the landlord must go to court to get a judgment against you. This allows law enforcement to require you to move out of the property.
You usually have an option to appear in court and fight the eviction. For example, if you’re withholding rent because the landlord has not fixed something that is his or her responsibility under the lease, you could use that as a defense.
A judge might rule on your side, requiring the landlord to make those repairs before you are required to catch up your rent. But keep in mind that we’re not legal experts—if you find yourself in this situation, we recommend consulting with a lawyer.
If you know you’re at fault or the judgment doesn’t go your way, you are likely going to have to move out of the rental property. It’s important to know how the eviction might impact your credit history and chances of getting another rental in this case.
If you’ve been evicted from a townhouse, apartment or rental home, it may be difficult to qualify for a new rental if a potential landlord checks your rental history. If you have an eviction hampering your ability to find a place to live, you have a few options:
If you were evicted for unpaid rent, the best way to make amends is to reach out to your former landlord or collection agency and make up those missed payments. Doing so could make finding a new place easier, especially if you get proof in writing that you made good on the old debts.
Abiding by your rental agreement is the most important thing you can do to avoid being evicted. Your agreement is a legally binding contract, so understanding everything expected of you—from maintenance of the property to noise restrictions and timely rent payment—is critical, as is knowing the tenant laws in your state.
If you have problems, talk to your landlord as soon as possible. Things happen, but landlords often appreciate knowing you want to do the right thing, and communication is essential. Also keep in mind that finding new tenants is a hassle most landlords would rather avoid. They can often be willing to work with you, but you have to take the first step.
Even if you do everything you’re supposed to do, when you live in someone else’s property, keep in mind that you might have to move unexpectedly. A landlord could potentially sell their property, or you could decide that the landlord isn’t someone you want to rent from anymore, for example. Keeping an eye on your credit regularly helps you improve your score, which can help you secure a new rental property as needed.
Check out Credit.com’s Credit Report Card. It gives you the everything you need to know about all the factors that make up your credit score, so you know exactly what areas you need to work on to improve your score.
Source: credit.com
Over the last couple of weeks, those of us currently saddled with student loan debt have watched closely as the topic of debt relief has bounced around between the Biden Administration, Congress, and the Supreme Court – which only very recently struck down the Administration’s plan to cancel up to $400 billion in student loans as unconstitutional.
As of Friday, July 14, however, the Biden-Harris Administration announced that over 804,000 borrowers will have a total of $39 billion in federal student loans automatically forgiven in the coming weeks. But what does that mean for you?
This action is specific to borrowers who have income-driven repayment loans, meaning borrowers whose monthly student loan payment is calculated based on income and family size.
As of April 2022, borrowers with income-driven repayment plans are offered forgiveness upon completion of a specified number of monthly payments, most commonly after 20 to 25 years.
However, this announcement broadens the definition of that forgiveness threshold and counts new circumstances as credit towards loan forgiveness, including:
Note: For a complete list please see the announcement on the U.S. Department of Education
According to the Biden-Harris Administration, this will happen immediately. Eligible borrowers should expect to receive a notification of their eligibility starting Friday, July 14, 2023. They can then expect to receive a discharge 30 days “after emails are sent.”[1]
The stated goal from the administration is to address issues with income-driven repayment (IDR) plans and ensure accurate tracking of borrowers’ progress toward loan forgiveness. There has been some question as to whether qualifying payments made under IDR plans were not properly accounted for in the past.
[1] https://www.ed.gov/news/press-releases/biden-harris-administration-provide-804000-borrowers-39-billion-automatic-loan-forgiveness-result-fixes-income-driven-repayment-plans
Source: credit.com
It might sound a little bittersweet, but former homeowners are now authorized to purchase the properties they lost to foreclosure at fair market value, instead of having to pay back the entire amount owed on the old mortgage.
This new rule applies to real estate owned (REO) properties held by Fannie Mae and Freddie Mac.
The Federal Housing Finance Agency (FHFA) announced the news today in a press release, with director Met Watt referring to it as a “targeted, but important policy change” intended to reduce the number of vacant homes and stabilize property values.
In other words, a larger pool of potential buyers should lead to fewer empty homes, which in turn should boost home prices and aid the ongoing housing recovery.
Previously, borrowers who lost their homes to foreclosure couldn’t repurchase them at their current value. Instead, they were forced to pay off the associated mortgage balances if they wanted the properties, something I doubt anyone actually did.
The old rule also applied to anyone who attempted to buy a foreclosed property on behalf of the previous homeowner.
Going forward, previous homeowners (or third-parties who purchase on their behalf) will be able to scoop up their old properties at their present value, as determined by Fannie and Freddie.
This policy change is limited to properties held by the pair as of November 25th, 2014.
For the record, the fair-market value policy already applied to purchasers of REO properties who did not originally own the homes.
If a former homeowner wishes to purchase their old property (or have someone buy it for them), it must be used as a principal residence. Simply put, you can’t buy your old home and rent it out.
The FHFA also noted that some property exclusions may apply and will be dealt with on a case-by-case basis.
At the moment, Fannie and Freddie hold about 121,000 REO properties in their collective inventory. It’s unclear how many former owners want to move back in.
If you’ve lost your home and want it back, you might be able to reacquire it more easily, though it should be noted that home prices have surged in recent years. So you’ll probably still pay more than you originally did, but I suppose it’s better than nothing.
However, you’ll need to be able to qualify for a mortgage again (assuming you can’t pay with cash), which can be difficult after experiencing a foreclosure.
The timeline to get a mortgage after foreclosure ranges from three to seven years for conventional loans, depending on the circumstances involved. It can be as short as one year via the FHA.
Source: thetruthaboutmortgage.com