Monthly Archives: August 2014

2014
08/28

Category:
Pay Day Loans

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Loan shop takes on pay day lenders

A credit union loan shop, offering a more affordable alternative to pay day lenders, has been opened in Leeds.

Leeds City Credit Union will offer loans with an APR of 26.8%, compared to the average APR of 299% from high cost lenders. It will also help raise awareness of local, more affordable alternatives to pay day loans, pointing people in the direction of finance and debt advice.

Chris Smyth, chief executive of Leeds City Credit Unio,n said: lsquo;By providing affordable credit union loans we intend to significantly undercut the excessive rates of interest, that the high cost money shops charge.

lsquo;Whats more the credit union, unlike the payday and high cost loan shops, will take care when giving credit we carefully check that a person applying for a loan can afford the repayments.

Leader of Leeds City Council, Cllr Keith Wakefield, said the new credit shop would help with the drive to make Leeds a lsquo;pay day lending free city.

He said: lsquo;We want to continue to encourage people to take advantage of responsible lenders in the city such as the credit union to get a better understanding of how they get out of debt, but also what other options may be available to them.

2014
08/27

Category:
Pay Day Loans

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Stowmarket news

Stowmarket and Area Food Bank has been running childens lunch clubs this summer to help people overcome the impact of food poverty.

As demand for food parcels has increased by 31 per cent over last year the food bank run by the New Life Family Church and Stowmarket Churches Together recognised a growing need among families whose children normally benefit from a free school meal during term time.

It has also been signposting more and more people to debt counselling and credit union financial help at a time when more and more people nationally are falling foul of pay day loans.

Pastor Mike Smith said they had been working with the local childrens’ centres and running lunch clubs at the Sunshine Centre at Hillside Community Centre where the Food Bank operates.

On Wednesday this week 30 children and carers sat down to a hot dinner.

Mr Smith said: “We have been working in Africa, Uganda and Rwanda feeding children there and I never thought we would be doing this in Suffolk. I never thought there would be a need.”

This week the Trussell Trust which runs several Food banks in Britain including one in Lakenheath announced it was providing financial help to prevent people resorting to Pay Day loans. This was thanks to £100,000 donation from money saving expert Martin Lewis,

“We know that food poverty is just one level of poverty and here we signpost people to Children’s Centres, the CAB and Credit Union. At the moment this partnership works well. They refer people to the food bank and we refer people to them. We’re all doing what we’re doing well,” said Mr Smith.

The Food bank is expanding its operation into Hadleigh in co-operation with Babergh District Council so that people can collect from its offices.

In its first year 398 families have been helped through the Food Bank with 55 more receiving Christmas Hampers. In the first six months of this year the numbers helped had gone up 31 per cent.

2014
08/27

Category:
Debt Settlement

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Senate should keep for-profit debt outfits out of Mass.

The bill, which passed the House and now sits in a Senate committee, would require that debt management companies be licensed and offer an up-front agreement to the consumer that clearly states fees and other details about how the debt will be handled. For-profit debt counseling companies typically charge a percentage of the debt as a fee. Some demand as much as 18 percent. Yet the bill sets no fee limits. Even more surprising is the momentum the bill has gained despite the generally poor record of the industry. In a 2010 report, the Government Accountability Office noted that the percentage of consumers who successfully complete a debt settlement program is in the single digits. In other words, for more than 90 percent of customers, there is little or no gain in exchange for the fee.

Debt-settlement firms often make the appealing promise that distressed consumers can get out from under their debts by paying a negotiated lump sum at a significant discount. They often advise clients to stop paying their debts in the interim and instead deposit the money into a separate account that will eventually be used for the lump sum offer to the creditors. But in many cases, the promised settlement never comes through, creditors wont stop calling, and consumers are left with most of the debt, fresh penalties, and worsened credit, plus the additional burden of fees to the debt-settlement company.

The need for sensible debt counseling is abundant in Massachusetts, where 48 percent of residents have a credit score thats considered subprime. Theres already a legion of nonprofit credit counselors who work to modify terms and gradually bring clients finances under control. Quick debt fixes, like the ones offered by debt-settlement firms, rarely work. In legalizing them here, the Legislature would be sure to create a new category of financial victim. The Senate should stand up for consumers and keep for-profit debt-settlement firms out of Massachusetts.


2014
08/26

Category:
Credit Ratings

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Morningstar Inc.: Morningstar Credit Ratings, LLC Affirms ‘MOR SBC1’ Small …

michelle.weiss@morningstar.com

Morningstar Credit Ratings, LLC Affirms MOR SBC1 Small-Balance Commercial Mortgage Servicer and Special Servicer Rankings for KeyBank, NA

NEW YORK, July 17, 2014-Morningstar Credit Ratings, LLC today affirmed its MOR SBC1 small-balance commercial mortgage servicer and special servicer rankings for KeyBank, NA, a wholly owned bank subsidiary of KeyCorp. KeyBanks servicing and special servicing platform formerly operated as KeyCorp Real Estate Capital Markets, Inc. until that entity was merged into KeyBank in late 2013. The affirmed small-balance servicer rankings are based on the following factors:

Small-Balance Servicing
? Proven capabilities to effectively integrate large portfolio acquisitions: During 2013, KeyBank acquired Bank of Americas commercial mortgage servicing business. It also acquired nearly all of Berkadia Commercial Mortgages special servicing rights, became the named servicer for a number of newly issued commercial mortgage-backed securities (CMBS), and expanded its work for government services clients. KeyBank managed this rapid portfolio expansion, which included many small-balance assets, along with the associated technology conversion challenges, in a highly effective manner while concurrently meeting the ongoing servicing requirements for its existing clients. Integral to supporting this growth, KeyBank expanded and extended its shared-servicing agreement with Berkadia.
? Investor reporting expertise: Morningstar has a favorable view of KeyBanks capabilities to provide accurate, complete, and timely reporting to CMBS and other investor clients. Its reporting capabilities fully address both CMBS and non-CMBS client requirements.
? Proactive and controlled asset administration: Morningstar has a positive opinion of KeyBanks asset administration capabilities for smaller-balance loans. KeyBank continues to have a successful performance record with respect to pooling and servicing agreement compliance and meeting its service-level agreements. Morningstar believes that KeyBank effectively oversees the Berkadia shared-servicing relationship with proactive oversight controls.
? Excellent technology: KeyBanks technology tools and centralized data management enable the company to service a diverse servicing portfolio efficiently. In particular, Morningstar believes KeyBanks proprietary, integrated asset management and reporting application, RECWeb, is highly effective for automated workflow management.
? Strong management and professional depth: KeyBank has retained an experienced management and professional staff. Morningstar believes that the company operates with a well-designed organizational structure that addresses its myriad servicing requirements efficiently. Additionally, Morningstar views KeyBanks managers and staff as quite adept with small-balance loan administration and asset management.
? Robust internal audit program: KeyBank has a thorough internal audit program that examines a broad range of loan administration and portfolio management processes. The audit reports issued during 2013 did not contain any material findings related to operational controls and practices. KeyCorps audit report also assigned its highest rating to the loan servicing operation. KeyBank supplements its audit function with performance monitoring activities administered by a dedicated compliance unit.
? Effective portfolio management: KeyBank has diligent, thorough practices for proactive asset-level management and portfolio oversight for smaller-balance loans. In particular, the company continues to achieve a very high collection rate of annual property operating statements and has a policy of pursuing annual property inspections for all small-balance loans. KeyBank effectively uses its proprietary technology to monitor collateral performance, track loan covenant compliance, and monitor trigger events for small-balance loans.

2014
08/26

Category:
Pay Day Loans

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Today’s Policy Update: Can Startups Help Kill Pay-Day Loans?

The Fed is going to continue stimulus for the time being. Conservatives should be happy.

In the New York Times, Binyamin Appelbaum reports on Federal Reserve Chairman Janet Yellen’s testimony before Congress.

The decline in the unemployment rate, meanwhile, has exceeded expectations, reaching 6.1 percent in June, but Ms. Yellen maintained her view that the decline was overstating the progress of the labor market. Some people who stopped looking for work are likely to return as the economy improves, she said. Wage growth also remains weak, suggesting employers still find it easy to replace workers.

Ms. Yellen also spoke about the “serious psychological toll” of unemployment and its long-term costs, underscoring her commitment to the Fed’s efforts.

Inflation also remains sluggish, suggesting that the economy continues to operate below capacity, and allowing the Fed to extend its stimulus campaign.

Many inflation hawks are ready for monetary stimulus to end, and to their point, there may be finally be some signs that inflation could start to creep upwards soon. However, it seems that Yellen is correct that, first, the labor market is in much worse shape than the unemployment rate would suggest (this is, ironically, an issue conservatives often point out), that the monetary stimulus is helping heal the economy, and that inflation is well below our target of 2 percent over the longer run.

In fact, even if Yellen were to continue stimulus for too long, inflation a little over our target would probably be a good thing by reducing debt burdens and increasing business investment. Fighting joblessness should be the top priority for conservatives, and monetary stimulus is still one of our most important tools in the fight.

Exclusion from the mainstream financial system can prevent upward mobility — can startups change that?

In The Atlantic, Derek Thompson examines the poor’s interaction with the financial system:

Middle-class families falling on hard times and grappling outside the traditional banking system are alarmingly common. Approximately 70 million Americans don’t have a bank account or access to traditional financial services. That’s more people than live in California, New York, and Maryland combined. It’s more than the number who voted for Barack Obama (or Mitt Romney) in the 2012 election. 

Instead of direct deposit, many rely on physical pay stubs. Instead of checking accounts, they have to drive to check-cashing services, like Pay-O-Matic. Instead of automatic payments, they drive again across the suburbs to pay utility bills in person. In lieu of a credit history that qualifies them for bank loans, they have a history of cash that is disqualifying. Instead of low-interest loans, they rely on payday lenders whose services can ultimately cost three- or four-times the original loan. And so, replacing the services of a bank on your own becomes a second part-time job, an odyssey of stripmalls, check-cashing storefronts, money orders, prepaid cards, and miles and miles on the road.

Ron Brownstein has called it the “archipelago of alternative finance.”

As Megan McArdle discusses in her recent AEI “Vision Talk,” accumulating capital is essential and often near impossible for those near the bottom of the income distribution. Derek Thompson’s piece touches on one of the barriers to accumulating that capital – lack of access to traditional financial institutions that leads to a reliance on payday loans. This is particularly troublesome to conservatives, who care a great deal about inclusion and helping the disadvantaged to lift themselves up.

There are policy possibilities here, but the private sector can help too. One tech startup, LendUp,

uses technology to approve borrowers with damaged or thin credit files.  As customers establish a responsible borrowing history with LendUp, they move up the LendUp Ladder, giving them access to more money, at lower rates, for longer periods of time.  The top two levels of the Ladder report to credit bureaus, giving customers the chance to improve their credit and gain access to mainstream financial services products.

The breakthrough is the technological innovation enabling approval of questionable credit, but the firm also has aligned their incentives so they don’t benefit if a client becomes trapped in debt and has committed “to building credit through education, gamification and a transparent fee structure.” As someone who’s always more optimistic about bottom-up innovations from the private sector than massive government interventions, it’s exciting to see a young startup working to solve one of society’s most vexing problems.

Land-use regulations aren’t only unjust; they hurt economic growth.

Often discussed in this space is the way that excessive zoning regulations that restrict housing reduce economic mobility, and Chang-Tai Hsieh and Enrico Moretti have released a new NBER working paper that examines the broader effects of such regulations.

Incumbent homeowners in high wage cities have a private incentive to restrict housing supply. By doing so, these voters de facto limit the number of US workers who have access to the most productive of American cities. Our findings indicate that in general equilibrium, this lowers income and welfare of all US workers. In essence, this amounts to a large negative externality imposed by a minority of voters on the entire country.

By segregating workers and preventing some from being able to access jobs for which they’d be well-suited, the regulations imposed by NIMBYs to increase their own property values reduce growth throughout the entire economy. A fundamental principle of policymaking must be working to eliminate artificial weights government places on the economy.

These authors suggest the federal government should limit how much local governments can regulate and improve mass transit to mitigate the costs of the regulations. There are other ways to fight these regulations, too, like paying off incumbent residents through TILTs. But the most important thing is that both liberals, who don’t always trust free markets, and conservatives, who reflexively defend the rights of property owners, realize that zoning restrictions are some of the biggest barriers government has placed in the way of society’s growth and mobility. 

2014
08/25

Category:
Debt Settlement

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Wealth Arranges Debt Settlement and 4:1 Share Consolidation

VANCOUVER, BRITISH COLUMBIA–(Marketwired – Aug. 8, 2014) –

NOT FOR DISSEMINATION IN THE UNITED STATES OR VIA US NEWSWIRE SERVICES.

Wealth Minerals Ltd. (the Company or Wealth) (TSX VENTURE:WML)(FRANKFURT:EJZ) announces that it has arranged to settle up to $1,918,472 of corporate debt through the issuance of common shares at a price of $0.08 per share. Following the completion of the debt settlement, the Company plans to consolidate its common shares on a 4:1 basis following which the issued and outstanding common shares will total approximately 21,433,626.

Debt Settlement

The Company has arranged to settle an aggregate sum of approximately $1,918,472 owing to insiders and trade creditors, by the issuance of approximately 23,980,894 common shares at a deemed price of CAD 0.08 per share. These securities will be subject to a hold period of four months from the date of issuance. Completion of the debt settlement will not create any new control persons.

Share Consolidation

The Company plans a share consolidation through a reverse stock split on a four old for one new common share basis. Following the debt settlement, the Company will have approximately 85,700,606 shares issued and outstanding and following the completion of the reverse split on a 4:1 basis there will be approximately 21,425,152 shares issued amp; outstanding.

Completion of the debt settlement and 4:1 share consolidation are subject to the acceptance for filing thereof by the TSX Venture Exchange.

The foregoing securities have not been and will not be registered under the US Securities Act of 1933, as amended (the 1933 Act) or any applicable state securities laws and may not be offered or sold in the United States or to, or for the account or benefit of, US persons (as defined in Regulation S under the 1933 Act) or persons in the United States absent registration or an applicable exemption from such registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the foregoing securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About Wealth Minerals Ltd.

Wealth is an early stage mineral exploration company with listings on the TSX Venture and Frankfurt Stock Exchanges.

On Behalf of the Board of Directors of WEALTH MINERALS LTD.

Hendrik van Alphen, President amp; CEO

For further details on the Company readers are referred to the Companys web site (www.wealthminerals.com) and its Canadian regulatory filings on SEDAR at www.sedar.com.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release, which has been prepared by management.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements and forward-looking information (collectively, forward-looking statements) within the meaning of applicable Canadian and US securities legislation. All statements, other than statements of historical fact, included herein including, without limitation, statements regarding the anticipated completion of and timing for the debt settlement and share consolidation (reverse split) and the anticipated business plans of the Company, are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company or any of its joint venture partners are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, the state of the financial markets for the Companys equity securities, the state of the commodity markets generally, variations in the nature, quality and quantity of any mineral deposits that may be located, variations in the market price of any mineral products the Company may produce or plan to produce, the inability of the Company to obtain any necessary permits, consents or authorizations required for its or their activities, the inability of the Company to produce minerals from their properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies, and other risks and uncertainties disclosed in the Companys latest interim Management Discussion and Analysis and filed with certain securities commissions in Canada. All of the Companys Canadian public disclosure filings may be accessed via www.sedar.com and readers are urged to review these materials, including the technical reports filed with respect to the Companys mineral properties.

This press release is not, and is not to be construed in any way as, an offer to buy or sell securities in the United States.

2014
08/25

Category:
Pay Day Loans

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New Focus For The ASA

The ASA has a new strategy for regulating ads, meaning it
won#39;t always wait for complaints before acting against an
offending brand. While the ASA has always had the power to take
action itself without having to receive complaints, it#39;s clear
that the regulator is now planning on taking a more proactive
approach to enforcement.

Following crack-downs on advertising fast foods, pay-day loans
and advertising directed towards children, these areas will be
prioritised at the expense of lower-order violations of the
advertising codes.

Chief executive Guy Parker stated that for many complaints, the
ASA will not be providing the level of service we are at the
moment.

Parker continued: Complaints don#39;t perfectly correlate
with the problems that are out there and we know our complainants
are not perfectly representative of the Great British public.
There are probably issues we are not addressing to the extent
we should because they are not coming through in our complaints
bag.

For more, read Marketing Week#39;s article here.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

2014
08/25

Category:
Pay Day Loans

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Poverty Is Profitable: 1 out of 3 US Consumers in Debt Collection

A new report by the Urban Institute and Encore Capital Groups Consumer Credit Research Institute shows 77 million Americans — 35 percent of those with files at a major credit bureau — have a debt in collection.

Nevada has the worst record, with 47 percent of consumers with a credit file showing a debt in collections. In 12 other states, including Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, New Mexico, North Carolina, South Carolina, Texas, West Virginia as well as the District of Columbia, more than 40 percent of residents with a credit file have a bill in collections. In some smaller areas, the in-collection number is as high as 61 percent.

The report also shows that one out of 20 Americans hold debt that is past due, ie, more than one month delinquent, though not yet in the collection process. Collection usually kicks in after 180 days past due.

Meanwhile, about 22 million Americans make so little money that they do not have credit files.

Poverty Is Profitable

But as you can expect, there is always someone profiting from poverty.

For example, in another area of debt, writing checks that exceed the amount in an account (bouncing a check), often in hopes of creating faux credit planning on money to flow in before the check is actually cashed, American banks collect $30 billion a year in overdraft fees.

Collection companies can be seen as a great investment. The companies buy debt cheap and collect high. For example, Bank A itself has no interest in chasing a person for, as an example, a $1000 overdue payment. Thats not the banks core business, banking is. So they sell it to a collections company for say 10 percent, or $100. If the company can get back from the consumer anything more than the $100, thats profit. It can be a lot of profit — one hyper-successful company boasts of a 239 percent return. A more typical return on investment for a collections company is 20 percent, a nice profit in itself.

In 2010, agencies collected about $40 billion from consumers. Business seems good: There are 4,100 debt collection agencies in the United States, employing nearly 450,000 people, and the industry expects to grow by 23 percent over the next three years. The Association of Credit and Collection Professionals, the industrys largest trade association, spent more than $660,000 on Congressional lobbying over three years.

So Stop Spending. You Dont Need That Big Screen.

The average American holds $15,000 in debt, about half of that on credit cards (though others put the credit card number at about $4000.) But more significantly, the national averages for mortgage debt are $154,365 and for student loans, $33,607.

A common statement at this point regarding those credit cards is So stop buying things you cant afford, especially with high interest rates. Duh. While there are no doubt people who misuse their credit to buy frivolous things, credit cards are to many in the middle class what pay day loans and pawn shops are to the poor: easy to access money for daily needs when there are no alternatives.

However, according to an analysis of spending from First Data, a major payment processing company, Americans increasingly used credit to purchase food and other everyday necessities.

During the month studied we saw consumers reducing the growth of their discretionary spending at retail merchants and increasingly resorting to credit for necessities, said a statement. Spending in clothing stores, restaurants and bars declined, while credit spending at general merchandise stores, including value retailers and discount stores, increased.

2014
08/24

Category:
Debt Settlement

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2014
08/24

Category:
Pay Day Loans

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Move to curb pay day firms unveiled

Published: 15 Aug 2014 11:00

BOLD plans to cut down on the numbers of new pay day lenders setting up shop in communities have been unveiled.

Local Government Minister Derek Mackay last week launched an action plan designed to help limit the numbers of new pay day lenders and stop people being exposed to financial credit they cannot afford.

Last year it was revealed that more residents in Clydebank were turning to short term and pay day loans as they struggle to cope with the financial crisis.

Joe McCormack, of West Dunbartonshire Citizens Advice Bureau, told the Post that his staff had dealt with desperate families who had turned to loans of 4,000 per cent just to make ends meet.