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Californians with student loan debt now have more rights

Four million Californians owe nearly $ 150 billion in student loans, according to LendingTree.

These borrowers now have more rights under a law that went into effect this year and got teeth this month with a new ombudsman empowered to investigate complaints about student loan providers.

The law limits excessive late fees and loan providers will be required to process payments in the best interests of borrowers in accordance with the law.

Here’s What You Should Know About What Proponents Called The “Student Loan Contract”:

How did this law come about?

Proponents have been calling for the law for years after student loan providers reportedly took advantage of borrowers.

A 2015 report by the Federal Accountability Office found that 70% of defaulting borrowers could have reduced their monthly loan payments by capping them on a percentage of their income. But providers have failed to educate many of these borrowers about the opportunity, the report said.

This finding, along with other practices such as failing to pay student loans to borrowers with permanent disabilities, led California to sued Navient, one of the largest student loan providers in the country, in 2018.

Rep. Mark Stone, D-Scotts Valley, introduced the law in 2019, citing California’s lawsuit.

“California will continue to push for increased consumer protection because we know that student loans not only affect borrowers’ lives, but also have a negative impact on the entire economy,” Stone said in a statement when he introduced the law.

What does this law mean for borrowers?

The law requires providers to act in the best interests of borrowers. That said, if you’ve paid more than you should be paying on your loan, that overpayment should be used to reduce your principal debt – rather than the interest on your next loan payment.

Providers must also minimize their fees.

For example, you can have four loans with $ 100 monthly repayments for a total of $ 400. You can choose to pay just $ 200 on time this month.

Previously, vendors could spread $ 200 across your four loans and charge late fees for all. Now they need to use that $ 200 to pay off two of your loans, which means you will only be charged for the two late fees that you did not pay on time.

The providers must also tell you how to save on your student loan payments. If you are on the verge of defaulting on your payments, the providers may have previously urged you to forbear, which often leads to additional interest. Now the providers must inform you about other options such as income-related repayment.

With Income-Based Payback, “you can make as little as $ 0 and still make progress on payback terms,” said Suzanne Martindale, assistant commissioner for consumer finance for the California Department for Financial Security and Innovation.

The law limits late payment interest to 6% of the amount overdue. The cap is especially true for those who have private student loans, which often have a flat late fee charged regardless of how much you owe, said Mike Pierce, co-founder and policy director of the Student Borrower Protection Center.

The law also requires vendors to have customer service professionals trained to serve populations such as veterans, senior borrowers, people with disabilities, and those in the public sector.

Staff should be able to notify these borrowers of any protections they have, such as: B. the issuing of public sector loans or the ability to redeem their loans, Martindale said.

The law applies to virtually all student loan providers except for federal credit unions, Martindale said.

How can I use this law?

The law of July 1st established an ombudsman to examine complaints about student loans.

The state has yet to recruit for the position, Martindale said. She hopes to fill the position by the fall.

However, borrowers can still file complaints about DFPI now, either through the website (dfpi.ca.gov/file-a-complaint) or by calling 866-275-2677 or 916-327-7585. Borrowers can also email questions to [email protected].

Keeping written records such as payment history and forms and being as specific as possible will help DFPI best handle your complaint, Martindale said.

The law now also allows borrowers to sue providers in court. You can contact your district’s highest court for recommendations on no or inexpensive legal services. For Sacramento County, the information is available online at saccourt.ca.gov/.

You are entitled to at least $ 500 for each breach or at least $ 1,500 if it significantly affects your ability to repay the loan, Pierce said.

What’s next?

Stone put another bill, Assembly Bill 424, aimed at private student loans. The bill, now in the Senate, would require debt collectors to document and prove that borrowers actually owe the money, said Chuck Bell, program director at Consumer Reports.

Debt collectors have filed lawsuits against borrowers with no proof that they owe the money. Many of these borrowers are unable to hire lawyers and go to court, which has resulted in debt collectors garnishing wages, Bell said.

Similar stories from Sacramento Bee

Jeong Park joined the Sacramento Bee Capitol Bureau in 2020 as part of the newspaper’s community-funded Equity Lab. It deals with economic inequality and focuses on how government policies affect working people. Prior to joining Bee, he worked as a reporter on cities for the Orange County Register.

source https://www.cassh24sg.com/2021/07/13/californians-with-student-loan-debt-now-have-more-rights/

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cassh24sg · 4 years ago

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5 Quick-Hit Personal Finance Tips To Help You Invest In Yourself

Making enough money is just the beginning – then you have to manage it. Everyone from college graduates to young professionals can take advantage of the benefits of developing their personal financial literacy.

Financial literacy is crucial

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Everyone knows that money can be tough. Getting enough of it is just the beginning – then you have to manage it. Millennials regret their share of the money, including credit card debt, lack of financial planning, and of course the big one: college debt.

Many university graduates now also carry considerable educational debts into the next phase of life. The national average of college debt is around $ 37,000 per borrower. Respondents in a recent CollegeFinance survey had graduated with an average of $ 22,000 in student loan debt, had $ 14,000 left to pay, and expected the repayment to be completed within six to seven years.

College debt affects more than just your financial prospects. Overall, 27% of CollegeFinance respondents say their student loans make career changes difficult, including 36% of those who owe $ 51,000 or more. Three in ten say the same when taking career risk, including 44% of those with $ 51,000 or more in student loans outstanding.

“Managing significant student loans adds stress,” said Ryan McPherson, director of coaching at SmartPath. “This can be compounded if the recent graduate’s income does not match his required debt payments. Higher debt burdens can mean that graduates need longer to save emergency funds and home payments. “

5 tips for managing money smarter

Of course, not only young people could benefit from a little more awareness in the area of personal finance. “Overall, Americans could take advantage of additional money management training for various life events, such as: Things like dealing with student loans, buying a home, preparing financially for children, paying taxes, and retirement planning, ”says McPherson.

“Employers have an opportunity to help with this problem by incorporating financial wellbeing into their HR benefit packages to train their employees in money management skills,” he says. However, workers shouldn’t wait for their employer to take the first steps towards better financial literacy. McPherson offers five quick tips that college graduates – and the rest of us – can use right away to create a better financial future:

Spend less than you make. Seriously. “This is the basis for any long-term financial success,” says McPherson. Of course, in order to spend less than you make, you need to keep both numbers in mind. Budgeting software like Mint, YouNeedABudget, and others can help you keep track of your money.

If your employer offers pension compensation, you are contributing enough to receive full compensation. “This is free money – don’t miss it,” says McPherson. Even if you’re just getting started in your career, it’s never too early to start saving for retirement.

Pay off your credit cards in full on each billing cycle to avoid interest. “There is no need to enrich the credit card company,” says McPherson. “It’s surprisingly easy that a $ 2,000 to $ 3,000 credit card balance becomes a $ 6,000 to $ 9,000 problem. Compound interest (which works wonders with investments) becomes your enemy on credit card balances. “

Build an emergency fund. Yes, there will be surprising expenses. “Start with a month’s spending and then build up three to six months of spending over time,” advises McPherson. Again, budgeting tools can aid your planning by helping you determine what an average month looks like. You can also anticipate flat-rate expenses that only come up once or twice a year, so it won’t be a surprise or an emergency when that bill arrives.

When you have student loans, devise a strategy. “Are you going to seek forgiveness or are you going to try to pay off your loans asap?” Asks McPherson. “These loans are not going to take care of themselves. Establish a payout strategy and let it work for you. “

Resources to get financially savvy

When it comes to personal finances, knowledge is power. “Start by reading as much as you can,” says McPherson, who recommends blogs like NerdWallet, Financial Samurai, Mr. Money Mustache, The Penny Hoarder, and Millennial Money. “These cover the basics such as creating a budget and intelligent ways to repay credit card debt and go through to advanced topics such as investing in rental property.”

McPherson also has some book recommendations, including The Psychology of Money, Fuel: The Most Important Number in Your Financial Life (written by SmartPaths CEO / Co-Founder), and The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money.

“Some of the topics in these resources will interest you and others will be awfully boring,” says McPherson. “That’s fine as long as you understand the basics. Dive deeper into what strikes you. “

SmartPath also offers a free online resource called the Money Moves Quiz, where anyone can answer 15 questions about their current finances and receive an actionable plan tailored to their individual situation.

Invest in yourself

The pandemic has created additional challenges for younger workers who not only had higher unemployment rates but also missed mentoring, networking and training opportunities in the office during the lockdowns. “While this doesn’t seem like an immediate financial challenge, it could hurt some career opportunities and career opportunities,” notes McPherson.

Despite these challenges, CollegeFinance found that about 6 in 10 people continued to make payments during the interest rate freeze, of which 86% made progress in paying off their loans.

People will continue to experience financial stress even after the pandemic ends. “It’s a scary time for new graduates to step into the ‘real world,’ so it’s more important than ever for employers to provide financial wellness resources and support previous open enrollments,” says McPherson. This can benefit both employers and employees, as surveys show that more employees would stay with their employer longer if they offered financial wellness benefits.

Money can be tough, but there are plenty of tools and sources of knowledge that can make it a little easier. No matter what point in your career you are at, it is always worth investing time in your finances – and ultimately in yourself.

source https://www.cassh24sg.com/2021/07/13/5-quick-hit-personal-finance-tips-to-help-you-invest-in-yourself/

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cassh24sg · 4 years ago

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Disaster office remains open for loan help

Almost 40 people in Bloomington have received help with questions about federal loans to pay for damage caused by the June flood, and personal advice will remain available through Friday evening.

Homeowners can obtain low interest loans of up to $ 200,000 from the US Small Business Administration for structural damage sustained by the flood. Homeowners and renters can also receive up to $ 40,000 to repair or replace damaged contents in their homes and vehicles.

Corporations can receive up to $ 2 million for physical loss and economic damage.

The SBA determines the amount of credit available based on proven losses. The loans cover everything that the insurance does not cover. Applicants do not have to wait to receive their insurance statement, said an SBA spokeswoman.

Julie Garrett, public affairs specialist with the SBA’s Office of Disaster Assistance, said the agency wanted homeowners, renters, and nonprofits to start rebuilding as soon as possible. Once they get their insurance statement, they can use those dollars to repay part of the SBA loan.

Damaged:Downtown businesses are still recovering from the Bloomingtonington floods

A loan from the Bloomington area has already been approved, she said, although applications typically take two to three weeks.

Garrett said people don’t have to borrow the full amount the SBA approves, but can apply for additional dollars for improvements aimed at preventing future flood damage. SBA loans also cover some areas that insurance policies typically don’t, such as: B. Damage to driveways, sheds and decks.

The city of Bloomington was hit by the heaviest one-day rainfall in more than a century in mid-June. The event killed a local resident, flooded parts of the city center and damaged homes, businesses and public infrastructure, displacing police officers and firefighters from their headquarters.

Staggered:Firefighters need to work from a temporary location

Homeowners can get loans with interest rates as low as 1.625%, while the interest rate on business loans can go as high as 2.88%. The rate for non-profit organizations is 2%. Borrowers must repay their loans within 30 years but can do so as early as possible. Initial payments can be postponed for 18 months, but interest will accrue during this time.

The local disaster credit bureau at the Monroe Convention Center, 302 S. College Ave., will be open 8 a.m. to 5 p.m. daily. It will finally close at 5 p.m. on Friday, but Garrett suggested that people don’t show up on time for closing time that day.

People can also have their questions answered by phone from 8 a.m. to 8 p.m. seven days a week: 800-659-2955. The credits can also be applied for online at sba.gov/disaster.

How to apply for a flood loan

Personally: Friday by 5:00 p.m. (but please arrive early) at the Catastrophe Credit Center at the Monroe Convention Center, 302 S. College Ave.

On-line: Sba.gov/desaster.

Phone: 800-658-2955 from 8 a.m. to 8 p.m. seven days a week.

Deadlines:

For property damage: September 7th

For economic damage: April 7th

Fees: None

Note: You don’t have to wait for your insurance statement to be requested.

source https://www.cassh24sg.com/2021/07/13/disaster-office-remains-open-for-loan-help/

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cassh24sg · 4 years ago

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What Credit Score Is Needed For A Personal Loan? – Forbes Advisor

Editor’s Note: Forbes Advisor may earn a commission on sales made through affiliate links on this page, but this does not affect the opinions or ratings of our editors.

Personal loans are one of the most versatile and practical loan products on the market. But, as with any form of debt worth having, the requirements for closing it can be strict. In addition, different lenders have different minimum requirements and different credit ratings result in different loan terms.

For example, we recommend a credit score of at least 670 to qualify for a personal loan. However, there are some lenders who may ask for a higher credit score and some that only require a minimum score of 580. However, the best conditions are usually reserved for highly skilled applicants.

We will show you how you can increase your chances of qualification and improve your score in order to receive more favorable loan terms.

Factors That Affect Your Credit Score

There are several credit scoring models, but FICO is the most likely model your lender will use, which has the following components.

Payment history

Payment history represents 35% of your creditworthiness and refers to your records of on-time monthly debt payments. Since it is a huge part of your credit score, a missed payment can result in a 100 point drop. Lenders can only report late payments after 30 days. If it has only been a few days since the due date, then you know. The number of days late and how long you have missed a payment also play a role and will affect your score. For example, a 30-day late payment is better than a 60-day late payment. A late payment from this month will affect your score more than one from 2018. Over time, the impact of late payment will decrease.

Credit utilization

Credit utilization makes up 30% of your credit score and is related to how much credit you are using compared to your total credit limit. You should aim for a quota of less than 30% but above 0%. Credit bureaus check both the credit utilization for each individual card and the total credit utilization of all of your credit cards. For example, let’s say you have $ 2,000 in credit on a credit card with a total credit limit of $ 10,000. In this case, your degree of utilization is 20%. If you withdraw $ 1,500, your new odds are 5%.

Length of credit history

The average age of your credit represents 15% of your credit score. Consumers with older credit history may have higher credit ratings than consumers with newer accounts. Lenders like longer credit histories because it proves that you can handle credit responsibly.

Credit mix

Revolving credit and installment credit are the two types of credit products. If you have both revolving and installment accounts, you have a good credit mix that is 10% of your creditworthiness. Revolving Credit refers to credit cards as there is no fixed withdrawal date and the user can keep the account open indefinitely. An installment loan product is a loan with a fixed repayment date, such as a mortgage, student loan, car loan, or personal loan.

New loans and tough inquiries

A tough query is when you apply for a new loan product and a lender checks your credit profile. These inquiries will remain on your credit report for two years, but will not affect your creditworthiness after one year. The number of tough inquiries makes up 10% of your credit score.

Here’s how to improve your score when it’s too low

If your credit score drops below 660 it can be difficult to qualify for a personal loan. Here are some easy ways to fix and improve your credit score:

1. Eliminate errors

According to research by the Federal Trade Commission, one in five people has a bug in their credit report, which can lead to a lower credit score.

Visit AnnualCreditReport.com and view all three credit reports from Equifax, Experian and TransUnion. If you notice a mistake, you can submit a dispute directly to Schufa.

If you see a negative mark that you recognize, check to see when it was originally created. Most fall off after seven years, but sometimes the company doesn’t report until after that time. File a dispute with any credit bureau to resolve this issue.

2. Lower your loan utilization rate

You can damage your credit if your credit utilization is greater than 30%. Fortunately, you can quickly improve your score by lowering the load. The easiest way to do this is to request a credit limit increase or to pay off your balance.

If you have multiple credit cards, focus on the one with the highest usage percentage. As soon as this ratio is below 30%, you pay extra for the one with the next highest occupancy. Do this until the usage percentages for each credit card are below 30%.

3. Finish applying for a new loan

Since tough inquiries and average credit age make up 20% of your credit score, if you want to improve your credit score, avoid opening new credit accounts.

4. Pay your bills on time

On-time payment history is the most important factor in determining your score, so paying bills on or before the due date can have a significant impact. Set calendar reminders for each credit card or loan due date. You can usually also set up automatic payments through the lender. When you set up Autopay, you make sure that you always have enough money in your bank account. Failure to pay and miss the due date could result in late payment.

Other factors that affect the creditworthiness of personal loans

Your creditworthiness isn’t the only element that lenders look at. Here are some other factors that can affect your application:

Debt-Income Ratio

The debt-to-income ratio (DTI) is the percentage of your monthly debt payments divided by your gross monthly income. Personal loan firms typically want to see a DTI of 36% or less; however, some allow a DTI ratio of up to 50%.

You can calculate your DTI by adding up your minimum monthly credit and credit card payments. Then divide that number by your gross monthly income, which is your pre-tax income divided by 12.

income

Many personal loan companies have a minimum annual income threshold that varies depending on the lender. For example, Avant has a minimum income of $ 20,000 while SoFi has a minimum income of $ 45,000. Before applying to any lender, check their income requirements to make sure you qualify.

Personal loans for fair or bad loans

Borrowers with a credit score below 669 have fair or poor credit scores, which reduces their chances of qualifying for a personal loan. But there are certain lenders who take care of these borrowers. Most charge higher interest rates and offer lower loan amounts than borrowers with good or excellent credit ratings.

Lenders who specialize in fair credit (580-669) borrowers include Upgrade, Wells Fargo, Avant, LightStream, Marcus, and Rocket Loans, to name a few. Bad credit borrowers (350-579) can apply for a personal loan at Upstart, Lending Club, Wells Fargo, Avant and Upgrade.

Compare personal loan rates from top lenders

Compare personal loan rates in 2 minutes with Credible.com

source https://www.cassh24sg.com/2021/07/13/what-credit-score-is-needed-for-a-personal-loan-forbes-advisor/

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cassh24sg · 4 years ago

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$57,000 to $0 — How This Software Engineer Eliminated Her Debt

Rawpixel / Getty Images / iStockphoto

When Carmen Perez enrolled at the University of South Florida, she didn’t expect it to lead to the litigation of her life. But thanks to a seemingly minor paperwork problem, that’s exactly what happened. The result? Not only did she have to repay a mountain of student loans, but she also had to grapple with a lawsuit that would drag on for a year and a half.

Read: How Millennial Women Can Take Control Of Their Debt Tips: 25 Ways To Save Yourself From Your Debt Disaster

One of Carmen’s student loans allowed her to defer payments, but only if she was still in school. When she was a junior, she received notices asking her to provide evidence that she was currently enrolled. But she didn’t think much of it, for she had already provided what she thought was sufficient evidence.

In 2009 Carmen graduated with a BS in Finance. After graduating, Carmen seemed to be doing pretty well. She has worked at various Wall Street firms, including an internship at Goldman Sachs and a position at Morgan Stanley. However, there was a dark side that most couldn’t see. Despite her financial background, she didn’t save any money, had credit card debt, and even took out payday loans. All of this added up to around $ 57,000 in debt.

Helpful: 19 ways to tackle your budget and manage your debt

Then, in 2016, she decided to put her finances in order. She has set a strict budget for herself and has taken up a sideline in photography. She wanted to get that debt out and take control, and it went well at first.

Then, three months after her debt was settled, she received notice that she had been sued.

Be careful: 16 key signs you will always be in debt

It turned out that these communications she received meant something, and now a lawsuit has been filed against her. And that wasn’t good. Remember, only three months earlier she had decided to turn her finances inside out. She wasn’t prepared for that. Still, she wouldn’t give up.

The story goes on

Instead, she defended herself and launched an all-out attack on her debt. Every penny she could raise was invested in paying off the student loan. This included bonuses, tax returns, and money that would otherwise have been invested. She even cut her spending as much as possible by getting rid of cables and capping her spending. With the help of her lawyer – and her determination – she managed to pay off the student loan in a year and a half.

Look here: How Much Debt Americans Have at Each Age

When the lawsuit closed, she shut down the rest of her debt – a car loan, medical debt, credit cards, and so on. In 2018 she was debt free. In 2019, she paid cash for a wedding and bought a house. Eventually Carmen began saving as much money as she could muster so that she could switch her career from finance to technology.

Of course, she also needed some marketable skills to help her shift gears. So she started teaching herself to code at night and on weekends. After all, she saved enough to quit her finance job. Then she attended a programming boot camp, which luckily was free.

Fix these issues: The 17 Biggest Budgeting Mistakes You Make

Carmen then started to work as a software engineer for a startup, but was unfortunately laid off in May 2020 for lack of money. Then she found a job at another startup, a fintech that specializes in anti-money laundering software. In a way, it came full circle when she worked in the same line of business in finance. Now she earns the same income working for the fintech startup as she does in finance.

Save more money: 37 Life Hacks That Will Save You Money

There’s no real secret on how Carmen paid off her debt. She faced an enormous challenge but did not give up. She buckled up and cut her expenses as much as possible. She took up a sideline, putting every penny she could raise to attack her debt. But getting hit in the middle of a lawsuit was a twist not everyone could have mastered. Carmen persisted and now helps others to put their finances in order.

While there is no secret or magic, it means that what Carmen did is reproducible. She has increased her income as much as possible and reduced her expenses as much as possible. The only “tricks” she used was to put extra money like bonuses and tax refunds on her debts. If she can, so can you.

More from GOBankingRates

Last updated: June 30, 2021

This article originally appeared on GOBankingRates.com: $ 57,000 to $ 0 – How this software engineer got rid of her debt

source https://www.cassh24sg.com/2021/07/13/57000-to-0-how-this-software-engineer-eliminated-her-debt/

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cassh24sg · 4 years ago

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APRA expects banks to prepare for negative rates

The Australian Prudential Regulation Authority (APRA) wants Australia’s Approved Depository Institutions (ADIs) to be prepared just in case the Reserve Bank of Australia (RBA) cuts the country’s cash rate into negative numbers. While the RBA has said in the past that negative interest rates are very unlikely, given the potential impact negative interest rates could have on Australian banks and their customers, it is important to think about what negative interest rates could mean to you.

What did APRA say?

APRA consulted with ADIs in December 2020 on their readiness for zero or negative rates and found that while most ADIs are well positioned to deal with these rates, some ADIs face operational challenges due to high costs and competing priorities would be.

According to APRA, ADIs are expected to “take reasonable steps to prepare for scenarios where the cash rate and / or market interest rates could fall to zero or turn negative”. In particular, APRA expects ADIs to develop “tactical solutions” by April 30, 2022 to introduce zero and negative interest rates.

What did the RBA say?

The RBA has said in the past that it “has no appetite” for negative interest rates in Australia and that negative interest rates are “extremely unlikely”. Recently, RBA Deputy Governor Guy Debelle said there are two reasons why the RBA does not consider negative rates to be appropriate for Australia in the current circumstances:

“Firstly, there is uncertainty about the effectiveness of negative interest rates, also because of the negative impact on savers. Second, and at least as importantly, there were other measures the bank could take to provide monetary incentives that we have put in place. ”

What could negative interest mean for you?

Australia’s cash rate affects how much it costs lenders to provide customers with loan products such as home loans, personal loans, car loans, and credit cards. When the cash rate falls or rises, so will the interest rates on many of these products. For example, whenever the RBA has cut the national cash rate in recent years, many mortgage lenders have passed the rate cut on to their customers.

In theory, a zero rate could mean zero-interest loans, or even loans where the bank is effectively paying interest to the borrower, rather than the other way around. For example, one bank in Denmark introduced 20-year home loans at zero percent interest, while another Danish bank offered a 10-year contract at -0.5 percent, with the borrower’s debt increasing by more than that each month Amount they pay (although there are still fees and charges to consider).

It’s also important to remember that zero or negative interest rates also affect savers. Many Australian banks already pay almost no interest on savings accounts and time deposits, although there are some higher interest rates. If the cash rate turns negative, banks could theoretically start charging customers interest on deposited savings – a scenario that could result in Aussies withdrawing their savings to cram cash under the mattress.

According to the RBA, however, banks in countries with negative cash rates have not passed these rates on to savings customers because it “made no economic or political sense to charge households and smaller businesses for the safekeeping of their deposits.”

What can you do about negative interest rates?

While the RBA has emphasized that Australia is unlikely to see negative interest rates introduced, it rarely hurts to get yourself a financial health check and wonder if you would still be in a good position with Australia’s cash rate at zero or less would be lowered below it. Similar to the APRA expectations for banks, it might be worthwhile to come up with a negative interest rate future plan, including comparing financial products that best suit your changing needs.

source https://www.cassh24sg.com/2021/07/13/apra-expects-banks-to-prepare-for-negative-rates/

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cassh24sg · 4 years ago

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July 12, 2021—Loan Rates Don’t Move – Forbes Advisor

Editor’s Note: Forbes Advisor may earn a commission on sales made through affiliate links on this page, but this does not affect the opinions or ratings of our editors.

Compare the refinancing rates for personalized student loans

Takes up to 3 minutes

Over the past week, the average student loan refinanced rate has remained the same. For many borrowers, interest rates remain low enough to warrant refinancing their student loans.

The average fixed rate on a 10 year refinancing loan was 3.65% from July 5-9. This applies to borrowers with a credit score of 720 or higher who have prequalified on Credible.com’s student loan marketplace. According to Credible.com, the average interest rate on a five-year floating rate loan for the same population was 3.05%.

RELATED: Best Student Loan Refinance Provider

Fixed rate loans

The average fixed rate on 10-year refinancing loans was 3.65% last week, like the previous week.

Fixed interest rates remain the same throughout a borrower’s loan term. This allows borrowers to refinance now to set a much lower interest rate than they would have received at this time last year. At that time last year, the average fixed rate on a 10-year refinancing loan was 4.32%, 0.67% above today’s rate.

A borrower refinancing a student loan of $ 20,000 at today’s average fixed rate would pay about $ 199 per month, for a total of about $ 3,902 over 10 years, according to Forbes Advisor’s student loan calculator.

Variable Rate Loans

The average floating rate on a five year refinancing loan skyrocketed last week. It fell from 3.04% the previous week to 3.05%.

Unlike fixed rates, floating rates fluctuate over the course of a loan period based on market conditions and the index to which they are linked. Many refinancing providers recalculate the interest rates for borrowers with floating rate loans on a monthly basis, but usually limit the amount of the interest rate – for example to 18%.

Refinancing an existing $ 20,000 loan into a five year loan at 3.05% interest would result in a monthly payment of approximately $ 360. A borrower would pay a total of $ 1,589 in interest over the life of the loan. However, because the rate is variable in this example, it can go up or down from month to month over this period.

RELATED: Should You Refinance Student Loans?

Fixed rate loans vs. floating rate loans

For most borrowers, the biggest motivation to refinance student loans is to reduce the interest they owe. This means that choosing the lowest possible interest rate is a top priority.

You may find that floating rate loans start out lower than fixed rate loans. But because they are variable, they have the potential to increase in the future.

Fortunately, you can reduce your risk by paying off your new refinancing loan quickly, or at least as quickly as possible. First choose a short, but manageable loan term. Then pay whenever you can. This can protect your risk against possible interest rate hikes.

As you consider your options, compare prices with multiple student loan refiners to ensure you don’t miss out on potential savings. Find out if you qualify for additional interest rate rebates, possibly through automatic payments or through an existing financial account with a lender.

When should you refinance a student loan?

Most lenders require borrowers to complete their deals before refinancing – though not all – so in most cases, wait until you get your deal before refinancing. You also need good or excellent credit and stable income to get access to the lowest interest rates.

If you don’t have enough credit or income to qualify, you can either wait and refinance later or hire a co-signer. The co-signer you choose should be aware that they will be responsible for paying the student loan when you can no longer do so and that the loan will appear on their credit report.

Finally, make sure you can save enough money to warrant a refinance. At today’s interest rates, most high credit borrowers can benefit from a refinance. But those with less than good credit who are not getting the lowest fixed or floating interest rates are not allowed to do so. First, research the rates you can prequalify for with multiple lenders, then calculate your potential savings.

Other student loan refinancing features to consider

One big catch with refinancing federal student loans into private student loans is that you lose many federal loan benefits like income-oriented repayment plans and generous deferral and deferral options.

You may not need these programs if you have stable income and want to repay your loan quickly. But make sure you don’t need these programs if you are thinking about federal student loan refinancing.

When you need the benefits of these programs, you can refinance just your private loan or just part of your federal loan.

source https://www.cassh24sg.com/2021/07/13/july-12-2021-loan-rates-dont-move-forbes-advisor/

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cassh24sg · 4 years ago

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Five Latin American Fintechs Disrupting Traditional Banking Showcased in Atlanta

Five fast-growing Latin American fintech firms used virtual conversations at the Fintech South conference in Atlanta last month to paint a picture of a maturing region where local innovation is translating into global integrations.

Atlanta has long been recognized as an international payments center, but has remained relatively isolated from consumer-facing companies across Latin America. And for good reason: the region itself was sluggishly innovated, blessed with rigid banking regulations, a conservative financial sector, and large sections of the population still excluded from the formal economy.

That is changing: Now fintechs are connecting the (often) unbanked masses with the broader system, while creating new products and services that expand their options for banking, investing and making payments.

Uala, an Argentine company whose name sounds like the French “voila”, started with the principle that everyone should have a digital account and a payment method. Now the company has 3 million users of its prepaid Mastercard and is expanding into Mexico, another major economy with a large population with no bank account.

Founder Pierpaolo Barbieri, a trained historian who has written a book on the economics of Spanish colonialism in the region, came up with the idea for the company after his research uncovered a problem that many had already identified:

“We have great financial services when you have a lot of money and no financial services when you don’t have a lot of money,” Barbieri said of the region.

Uala’s idea is to use technology to reduce the costs of integrating people into the system in a way that banks with their “analog” business models were previously unable or unwilling to do. By accepting everyone on its mobile platform, Uala enables people to build a credit history and ultimately gain access to investment markets, insurance products and loans.

“That can only begin if we give everyone an account and digitize these transactions,” said Barbieri.

Latin America, he added, is maturing as investors make the promise in the region in Nubank, a Brazilian fintech that has valued at $ 30 billion, and Argentine e-commerce giant Mercado Libre with a market cap at the NASDAQ of over $ 80 billion. Even the Southeast Asian ride-hailing startup Grab, valued at $ 40 billion, shows risk appetite in markets traditionally not served by Western venture capital.

“What has come of age is the ability to see the potential outcomes that you previously only saw in Europe and the United States in other regions,” said Barbieri.

Brazil-based Creditas was founded in 2012 and has also benefited from banks’ reluctance to deviate from their traditional business models. Because Brazil’s banks were so conservative, they were shielded from the effects of the 2008 financial crisis, but were also holding back the chance to unleash private sector productivity.

“Unlike the US, credit in Brazil is not seen as a leverage for growth; It’s just something you take when you can’t pay your bill, ”said Luana Bichuetti, vice president of auto business, who also spoke on Latin America during the World Stage Focus.

The proof: 60 percent of the US real estate market is leveraged, as opposed to 6 percent in Brazil, which means 94 percent of the money tied up in Brazilian homes could be used for investments, she said.

Creditas started out as a way for customers to compare the interest rates of different banks, but eventually realized that it could help them unlock credit by accessing loans backed by their homes, cars, and even salaries.

The company initially relied heavily on partner banks, but at a time of rapid growth it built its own tech stack and “developed the technology as we flew the plane,” said Ms. Bichuetti. After the Sao Paulo-based company raised $ 255 million in late 2020, its workforce grew to more than 2,000.

ADDI, based in Bogota, Colombia, offers a different type of loan and enters the “buy now, pay later” area, which allows the consumer to split the cost of a purchase into installments, often without interest. Klarna based in Sweden, Afterpay from Australia and Affirm based in the USA are among the largest providers in the world.

But ADDI co-founder Santiago Suarez says Latin Americans recognize and embrace this practice. He recalls seeing his father write 12 checks as a child after the date to make installments for a year.

“We just said: ‘Okay, it’s time to transfer that to the digital world,’” he said during the conference in a conversation with investor Quona Capital.

In Latin America, the prevalence of credit cards is below 25 percent, and many online credit card transactions are refused for technical or financial reasons. For merchants, processing can take days. Because of this, merchant and consumer alike – the parties they want to unite for a smooth transaction – are using “probably one of the really new payment methods since the advent of the credit card networks”.

The transformation was aided by a five-month COVID-19 lockdown that forced people in Colombia’s “low-trust society” to shop online. Mr Suarez saw his platform’s origination volume plummet in the early days of the pandemic, but things were slowly picking up again and many transactions started on mobile devices. ADDI recently raised $ 65 million in debt and equity financing to fuel its expansion, including entering the much larger Brazilian market.

Waiting there is Zoop, a Brazilian company that helped advance the “Fintech-as-a-Service” model that is being adopted by companies like Plaid in the US

“We joke we were there before it had a name,” said Dan Faccio, chief financial officer, during a Fintech South interview with Bianca Lopes of Talle.

Zoop’s platform, part of a development towards “embedded banking”, enables companies to offer financial services without duplicating the structure of payment channels and the handling of compliance issues. One of the main customers is iFood, the largest food delivery platform in the country, which offers banking-like services and point-of-sale terminals for restaurants that use Zoop’s technology.

Beyond the markets, Zoop’s ERP software systems also enable them to provide fintech services to the clientele they serve, said Mr Faccio, using those that focus on hair salons as a prime example. While a community bank may not be the size to handle the complexities of this particular segment – collecting payments, managing cash flow, getting tips – the ERP system can leverage the size of Zoop to offer its users a bespoke solution.

The Brazilian central bank has set out to reform a formerly closed and “oligopolistic” banking sector, to strengthen privacy, empower consumers and promote competition. Handling the back-end fintech problems enables clients to use their unique knowledge of the client to provide financial services without hiring a traditional bank intermediary.

The Jeeves expense management platform is also in a similar business of eliminating complexity. The company has created a single platform that enables companies to manage corporate spending in multiple Latin American jurisdictions. First of all in the form of a Mastercard, which can be paid back in local currency, but founder Dileep Thazhmon sees it as a “financial pile” for globally growing companies. Jeeves builds on and integrates with the payment and financial infrastructure of the respective country, while customers only communicate with the Jeeves app.

Mexico, where Jeeves started, and Latin America in general are at a “turning point” in their startup ecosystems at a time when people are entering the formalized economy and entering the digital world.

“You actually have second generation founders now that you didn’t have in the 80s and 90s, and they’re just a lot more risk tolerant,” Thazhmon said. “That is the lifeblood of what brings these amazing companies out of LATAM.”

And that attracts financiers: “The capital that comes into the market is only a huge, exponential amount than it was two years ago,” he said. Jeeves is a will as the company announced debt ($ 100 million) and equity funding ($ 31 million) from Andressen-Horowitz and other investors just weeks before Fintech South.

For Atlanta, the follow-up question will be whether the companies here will continue to integrate into a region where the city has deep development and connections, into an industry in which it has some undeniable advantages.

To view all of Fintech South’s content, including World Stage Talks from Latin America, Asia, Europe and beyond, click Here.

source https://www.cassh24sg.com/2021/07/13/five-latin-american-fintechs-disrupting-traditional-banking-showcased-in-atlanta/

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cassh24sg · 4 years ago

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Louis Zitting: Understanding What Today’s Borrowers are Thinking

Louis headquarters

PERSON OF THE WEEK: With borrower protection set to expire in the coming months, mortgage service providers continue to prepare for a potential wave of defaults due to the COVID-19 crisis.

According to the Mortgage Bankers Association’s Forbearance and Call Volume Survey, the percentage of mortgages in COVID-19-related forbearance plans was 3.76% of all loans as of July 4.

Around 1.9 million homeowners are still on deferral plans, as data from the MBA shows.

Added to the concern is that some of these borrowers are already “haunting” their mortgage service providers. In a recent interview with Mortgage Orb, Louis Zitting, Founder and CEO of MonitorBase, gave some tips on how servicers can deal with this problem.

Q: Borrowers ghosting mortgage managers during the pandemic has become a hot topic. How big is the problem? Why do some borrowers choose not to contact their service providers when they find themselves in financial need?

Seat: It’s a pretty big problem. The first thing we need to understand is that this is the age of robo-callers and spam caller filtering. Nowadays it’s just hard to get someone on the phone who you haven’t had a personal relationship with. This affects the financial services industry.

A word to the wise, you can’t spam someone’s phone or email for too long before they ignore you. If you call and call and your borrower doesn’t answer, your chances of being referred to as a “potential spam” caller by the borrower’s phone go up dramatically.

Second, there are still many borrowers who simply do not understand their rights under the CARES Act. If they knew how easy it is to get relief, they’d answer the phone or contact their servicer, right? As an industry, we need to better educate borrowers that help is available.

Q: What have some service providers done to address the “disappearing” borrower problem?

Seat: There is a lot a company can do to automate and coordinate contacting borrowers between their servicing and origination channels. Unfortunately, however, these business processes are often very incoherent. At this stage of the game, most servicers are also overwhelmed with handling the onboarding of billions of new originations and handling incoming phone calls.

Service providers need to get creative to stay in touch with their customers. For example, predictive analytics are available that can monitor the behavior of borrowers, for example whether a borrower has already applied for a loan elsewhere or has offered his house for sale. These tools can also automatically send messages based on a borrower’s communication preferences, allowing servicers to stay on their customers’ radar.

Q: What impact will the termination of the forbearance plans have on the market? Do you see many borrowers unable to make their payments?

Seat: It is possible, but not likely. Take a look at today’s market data. Inventory is so low that one sale can at least prevent most borrowers from defaulting and foreclosure. In 2007, homeowners who couldn’t pay their mortgage called their lender. Today a homeowner who is struggling can call their agent. Most understand that they can get out of their mortgage without too much collateral damage to their creditworthiness. The unfortunate part is that it will be a lot harder for them to get back into the market.

Q: What do you notice about borrowers’ behavior today? Are there certain characteristics that might indicate when someone might be interested in buying a home or refinancing?

Seat: Cash-out refinancing operations have become contagious as the demand for these products has increased significantly in recent months. Part of this was caused by the big banks suspending HELOC lending at the start of COVID. We are currently almost back to the pre-2007 mortgage crisis level when borrowers took out credit for everything on their home. However, today we see many of these funds returning to the borrower’s home. This can be an indicator of a future property supply, but it can also be a sign that your borrower will need another mortgage soon.

Q: What loan products seem to be the most popular among home buyers these days? Do you see certain products gaining momentum this year or 2022, and why?

Seat: With interest rates still relatively historically low, the lowest 30 year vanilla compliant fixed rate loan seems to be the winner. However, “popular” is not the word I would use to describe a loan in the current market. It’s more a question of availability.

As real estate values rise, many people are being priced out of the maximum loan amounts for government funding. Because of this, many lenders are sharpening their jumbo finance value proposition. However, there appears to be a growing gap between the haves and the haves when it comes to making a down payment and qualifying for those larger loans. You can prequalify with a 640 credit score and a 3% drop, but we are seeing fewer and fewer of these homebuyers reaching the finish line. You just can’t compete with people who have excellent credit ratings and are able to offer cash. Somehow we have to solve this problem.

I think that’s a big difference between this housing market and 2006. The markets are liquid and there are financing options, but you can’t buy a home these days without good credit. There are no crazy option ARM products that are going to explode with consumers. The difference in credit quality is night and day.

Q: Given the heating up in the housing market, what can lenders do to differentiate themselves from their competitors?

Seat: We’re still in the middle of a historic refi boom and lenders are keen to keep the party going. The party doesn’t seem to be over yet, but I think a lot of lenders are thinking about the “after party” so to speak. What happens when you have a third less volume and falling margins – and what do you do with all the underwriters you hired? If you are hoping to outperform other lenders, you need to do things differently than you did before.

I think that’s why we’re starting to invest a lot in marketing automation and rationalizing the point of sale. With today’s technology, lenders are able to analyze hundreds of data points to see which customers or prospects are showing signs of behavior that we call “in the market”. For example, it’s pretty easy to find out who is preparing to take out a mortgage or sell their home. As the market warms up, I believe these tools will become more and more the standard – at least with the best-performing lenders.

source https://www.cassh24sg.com/2021/07/13/louis-zitting-understanding-what-todays-borrowers-are-thinking/

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cassh24sg · 4 years ago

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Santa Cruz County Bank Hires Chief Credit Officer Susan Just

Early in her career at JPMorgan Chase and its predecessor organizations, Ms. Just established herself as a skilled underwriter of commercial, corporate and securitized transactions, assuming increasing responsibility roles and managing multi-billion dollar transactions. After 17 years at JPMorgan, Ms. Just shifted her focus to community banking and broader credit risk management. She was a Senior Credit Officer at First Chicago Bank & Trust, a $ 1.1 billion Community bank and was responsible for integrating and streamlining the credit functions of the merged predecessor banks. At Northern Trust, Ms. Just led the credit review and led the global compliance testing functions. She was also responsible for that as the lead credit officer $ 8.5 billion TCF Bank’s retail loan portfolio. More recently, Ms. Just headed the ALLL role at the Bank of Montreal, and worked as a loan portfolio manager for a new financial technology company during the pandemic.

Ms. Just received her MBA from the Kellogg Graduate School of Management at Northwestern University with a focus on finance and strategy and her bachelor’s degree in business administration from Loyola University of Chicago with a focus on marketing.

Commenting on her new appointment, Ms. Just said, “Santa Cruz County Bank is known in the industry as a well-run bank with exceptional financial ratings. I am honored to be part of the leadership team and look forward to contributing to the bank’s growth ”and continued success. As a former competitive sailor, I am drawn to the Monterey Bay area and I am thrilled to be part of the local community. “

Krista Snelling, President and CEO, commented, “We are pleased to have Susan as Chief Credit Officer and a valued member of our executive team. Susan’s extensive background in credit risk, her in-depth portfolio management experience and regulatory knowledge are essential to management. ” the increasing complexity of a loan portfolio for a growing bank of our size. We look forward to Susan’s contributions to the bank and the communities we serve. “

Ms. Just is based in the bank’s headquarters in Santa Cruz.

ABOVE SANTA CRUZ COUNTY BANKSanta Cruz County Bank was founded in 2004. It is a premier, locally owned and operated, full service community bank based in Santa Cruz, California. The bank has eight branches – Aptos, Capitol, Cupertino, Monterey, Santa Cruz (2), Scotts Valley and Watsonville. The Santa Cruz County Bank differs from “big banks” in its relationship-oriented service, its focus on problem solving and direct access to decision-makers. The bank is a leading SBA lender in Santa Cruz County and Silicon Valley and a leading USDA lender in the state of California. As a full-service bank, Santa Cruz County Bank offers competitive deposit and credit solutions for businesses and individuals; including business loans, lines of credit, commercial real estate finance, construction loans, agricultural loans, government-guaranteed SBA and USDA loans, credit cards, merchant services, remote deposit tracking, mobile and online banking, bill payment and treasury management. True to its community roots, Santa Cruz County Bank has supported regional welfare by actively participating in and making donations to local nonprofits.

Santa Cruz County Bank’s shares are publicly traded on the OTCQX marketplace under the symbol SCZC. Share buy orders can be placed online, through a brokerage company, or through market makers listed in the Investor Relations section of the bank’s website. More information about Santa Cruz County Bank can be found at www.sccountybank.com.

This press release may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties may include, but are not limited to, fluctuations in interest rates, inflation, government regulations and general economic conditions, and competition within the businesses in which the bank operates, including the real estate market in California and other factors beyond the control of the bank. Such risks and uncertainties could mean that the results for subsequent interim periods or for the full year differ materially from those stated. Readers are cautioned not to place undue reliance on forward-looking statements, which represent only management’s views as of the date of publication. The bank assumes no obligation to publicly revise these forward-looking statements to reflect future events or circumstances.

SOURCE Santa Cruz County Bank

More top readings from Oileli:

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source https://www.cassh24sg.com/2021/07/13/huge-dividend-cripples-worlds-largest-oil-company/

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cassh24sg · 4 years ago

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Why Banks & Credit Unions Should Pounce on the ‘Payday Revolution’

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The way banking and financial services are provided has changed massively with the advent of digital technology. But the industry is still trying to crack the code, so to speak, to figure out how to get the most pay people off.

Probably the greatest innovation in payroll over the last century has been direct deposit. And that was great. However, the payroll departments continued to pay workers on the first and 15th of the month or twice a month depending on the employer. That’s the way it was.

Until a few years ago when a handful of innovators found alternative ways to pay workers, especially as more Americans lived from paycheck to paycheck and wages stagnated for many.

One of the first innovations was the “get paid early” feature, first offered by the digital Neobank Chime and later by other neobanks such as Revolut and Varo.

The idea was to give customers access to direct deposit funds a few days earlier than they would normally appear in their account in case those customers couldn’t extend their previous paycheck until they were paid back.

The main driver:

A major reason for early pay, aside from customer loyalty, is to help consumers avoid going to payday lenders to make ends meet between paychecks.

Several traditional banks have also begun offering such services, including Cincinnati-based Fifth Third, which allows customers to withdraw a cash advance on a direct deposit. The advance can range from $ 50 up to $ 1,000, with more cash available over time.

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The rise of on-demand payments

The early access feature is hugely popular, and many attribute much of Chime’s rapid customer growth to it. The feature has now spawned other options, including pay on demand.

“Today people can access anything they want, from streaming entertainment to transportation,” said Seth Pelletier, principal product manager for Ceridian’s dayforce wallet product. “Waiting two weeks for payment feels archaic in this context.”

On-demand pay allows employees to access their earnings as soon as they have earned them, explains Pelletier. “Bills and expenses don’t wait until payday. With on-demand payment, employers give people the opportunity to access money they have already earned so they don’t have to rely on other means of payment such as loans. “

Key point:

New paycheck options are also useful as recruiting tools as companies seek to stand out in a fierce battle for talent.

A note to be careful with early wage plans

Some organizations have expressed cautious attitudes towards early access programs. In a brief paper on the matter released in March 2020, the National Consumer Law Center states that “Early Pay Services claim not to be credit and not subject to state or federal credit laws, including fee and rate limits and disclosures.

“The laws in force can be complicated,” the paper continues, “but conceptually, any service that advances wages and expects to be paid back later should be viewed as a loan. The mere fact that an employee has unpaid wages (like many payday borrowers) or that the repayment is through wage deduction does not mean that an advance is not a loan. A $ 100 advance paid five days prior to payday with a $ 5 fee or “tip” is an annual percentage of 365%. “

Add to this the fact that if a customer is continuously paid two days earlier than normal through such a service, that earlier date becomes the “new normal”. Then consumers can simply change their buying habits by expecting the early paycheck and it doesn’t get “early” anymore.

“Think twice about being able to move through the next pay period if your paycheck is dumped,” Lauren Saunders, assistant director of the National Consumer Law Center, told BankRate. “Wean yourself off from it. Take out less the next time you need it. “

Pelletier says pay on demand should be part of a broader financial wellness strategy that employers are offering to their employees.

“It’s an example of meeting the expectations of the modern workforce,” he says. “By evaluating key factors such as costs, compliance and integration requirements with other financial wellness offers, employers and their employees prepare for success.”

3 ways financial institutions can win over Generation Z and compete with fintechs

In this webinar, Zogo, the platform that helps over 100 financial institutions attract and engage Generation Z, will share three ways to effectively gain the trust of young adults.

Wednesday, July 14 at 2 p.m. ET

PNC’s three-way partnership for real-time wages

Getting paid anytime, based on what employees have earned up to a certain point, is the idea behind the partnership between New York-based payment technology company DailyPay, PNC Bank and The Clearing House. Leveraging TCH’s real-time payments network, the agreement enables PNC to offer its customers the ability to “receive instant wages when needed, without disrupting the employer’s normal weekly or biweekly payroll and processing,” it said in a press release.

These real-time payments, the billing notes, allow employees to receive funds instantly so they can better manage cash flow and avoid high fees and interest rates on payday loans and bank charges.

“The versatility of the RTP network enables new business models that enable us to help our customers differentiate their business operations,” said Chris Ward, executive vice president and head of digital and innovation, PNC Treasury Management.

The PNC offering allows customers’ employees to access the income earned up to a certain dollar amount in each billing cycle, rather than waiting until the next billing cycle. Workers can benefit from “an inexpensive way to resolve financial emergencies quickly, better maintaining financial stability without going into debt, even in the face of unexpected expenses,” a Paychex blog said.

Companies also benefit from higher productivity as employees are less stressed by personal financial problems and higher employee loyalty, Paychex continues.

Weigh up the pros and cons

Ceridian’s Pelletier says adding these new payroll options also won’t require any changes to the existing payroll process, including funding, timing and completion of pay. “That means administrators don’t have to spend time coordinating at the end of the pay period,” he says.

The thin one:

Paying on demand has advantages for employees, such as the ability to process unexpected invoices, but also disadvantages such as burdensome tax consequences.

On the other hand, the disadvantages for workers are potential consequences in terms of fees and taxes. A Business News Daily article advises that workers must pay fees to have on-demand access to their wages and that those on-demand wages are typically not taxed, meaning that employers will pay these taxes from an upcoming one Have to deduct paychecks.

However, it appears that various forms of on-demand payment are gaining acceptance in the economy. While only a handful of fintechs and banks currently offer such services, this number is likely to increase in view of the success to date. PNC’s partnership throws the weight of the country’s seventh largest bank behind the trend.

source https://www.cassh24sg.com/2021/07/13/why-banks-credit-unions-should-pounce-on-the-payday-revolution/

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cassh24sg · 4 years ago

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Student Loans Are Due Starting October 1 — Here Are Answers To 10 Popular Questions

President Joe Biden (Photo by ANDREW CABALLERO-REYNOLDS / AFP via Getty Images)

AFP via Getty Images

From October 1, 2021, your student loan payments will be due again.

Here’s what you need to know – and what it means for your student loans.

Student Loans

If President Joe Biden does not extend the student loan facility – which includes a temporary deferral of student loan for federal student loan – your student loan payments will be due again starting October 1, 2021. In that case, you may have to answer a million questions to head over to the end of the payment hiatus for your student loans. Here are the answers to 10 common questions:

1. Are the installments of my federal student loan due on October 1, 2021?

If Biden doesn’t extend student loan relief, September 30th would be the last day. This means that student loan payments will resume from October 1, 2021, but that is not necessarily when the student loan payments are due. Your specific due date for your student loans lies between you and your student loan service provider.

2. What is the interest rate on my student loan when the student loan payments are resumed?

When student loan payments resume, your interest rate should be the same rate you had in March 2020 when the student loan suspension due to the Covid-19 pandemic began. There will be no new interest on your federal student loans during the Covid-19 pandemic. The effective interest rates on your federal student loan were 0% for that period. If you think there is a problem with your interest rate, check with your student loan service provider.

3. I have an adjustable rate student loan. Won’t my interest rate change from October 1st?

All federal student loans are fixed-rate student loans. If you have a variable student loan, it is a private student loan. Due to the Covid-19 pandemic, private student loans are not covered by the temporary deferral of student loans. However, the variable interest rate on your personal student loan is subject to change.

4. Will I still have the same student loan service provider?

Most student loan borrowers will have the same student loan service provider they had before the Covid-19 pandemic. If your student loan was sold or transferred, you would have received correspondence from your previous student loan officer.

5. How do I contact my student loan service provider?

Contact your student loan service at any time. You don’t have to wait for the student loan payments to resume.

6. How will I know if student loan payments will resume after September 30, 2021?

If the payment hiatus expires on September 30, 2021 as planned, the U.S. Department of Education will contact you in writing to notify you that the regular payments of the federal student loan will be resumed.

7. Should I change my earnings-based repayment plan?

If you’re on an earnings-based repayment plan for your federal student loans, now is a good time to review your current student loan repayment schedule. There are four income-based repayment plans: IBR, PAYE, REPAYE, and ICR. Now is also a good time to update your income and family information. Your income, marital status or family size may have changed as a result of the Covid-19 pandemic. Make sure you update this information as it could affect your student loan payments. This is also a good time to update your contact and bank details for automatic payment in case there are any changes. For more information, please contact your student loan service.

8. I have not made any payments for federal student loans since March 2020. Do I get credit for student loan issuance?

Yes, one of the great benefits for student loan borrowers is that you can get a “loan” to make federal student loan payments even if you haven’t made any during the Covid-19 pandemic. This is helpful for anyone looking for an income-based repayment plan or student loan termination through the Public Service Loan Program after 20 or 25 years. In practice, from March 2020 to September 2021, you would receive a “credit” for paying a student loan every month, even if no student loan payment was made. This is especially helpful for student loan borrowers seeking government loan relief that requires 120 monthly federal student loan payments.

9. Will Biden extend the student loan payment hiatus beyond September 30th?

It is possible that Biden will extend the student loan facilitation beyond September 30, 2021, even if the unemployment benefits and eviction moratorium end. The expanded unemployment benefit and eviction moratorium are two other popular financial aid programs for those who got into financial difficulties during the Covid-19 pandemic. The federal government has decided not to extend any of the programs. However, there is no guarantee that Student Loan Facilitation will be extended. For example, Biden may extend student loan relief beyond September 30th, but there is one major dilemma. Senator Elizabeth Warren and other members of Congress and US Department of Education officials have urged the president to extend the student loan facility until at least early 2022. However, Biden or Education Minister Miguel Cardona did not say whether there will be any enlargement.

10. Will my student loans be canceled?

Some student loan borrowers believe student loan cancellation is possible while others say student loan cancellation has been canceled. Biden has canceled nearly $ 3 billion in student loans since taking office as president. This includes student loan cancellation of $ 1 billion in student loan for 72,000 student loan borrowers. Biden canceled an additional $ 1.3 billion in student loans for 41,000 borrowers with total and permanent disabilities. Biden has also issued student loan debt relief of $ 500 million for 18,000 student loan borrowers under the borrower defense policy to repay student loans. Last week, Biden also canceled $ 55.6 million in student loans, meaning that Biden canceled $ 1.5 billion in student loan this way. The termination of the student loan and the term of the student loan are separate topics. The Biden administration is considering canceling the student loan, but any decision to make extensive student loan forgiveness will not affect whether the temporary student loan relief (which involves paying student loans) is extended. It is possible that both or neither will happen.

There is no guarantee that the student loan facility will be extended. In any case, make sure that you are financially and strategically prepared to repay the student loan. Here are some popular options to save money:

Student Loans: Read More

Biden can extend the facilitation of the student loan beyond September 30, 2021, even if the unemployment benefit and the eviction moratorium end

Biden has now canceled $ 1.5 billion in student loans this way

Is this a game changer for student loan termination?

Supreme Court Denies Student Loan Termination – Here’s What Happened

source https://www.cassh24sg.com/2021/07/13/student-loans-are-due-starting-october-1-here-are-answers-to-10-popular-questions/

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cassh24sg · 4 years ago

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Can you get pre-approved for a home loan online?

The pre-approval process can be an exciting but time-consuming undertaking. Gathering all of the relevant documents can be a chore, but without prior approval you will not know your creditworthiness and may not be able to make a secure offer on a property.

Would-be borrowers may hope to streamline the process by avoiding going to a branch to apply for a mortgage. This is where online mortgage applications come in, allowing eligible borrowers to obtain pre-approval for a home loan online.

As long as you meet a home lender’s eligibility criteria, you should be able to apply for pre-approval through the lender’s website.

Barriers to online home loan pre-approval

While applying for a home loan online can be a relatively straightforward process, there are times when the application may not go through. Some common reasons why you may be denied online pre-approval for a home loan usually relate to problems with your records, problems with the property, or failure to meet eligibility criteria.

Reasons for denying online pre-approval can be:

The lender is unable to verify your identification documents or credentials.

The lender can evaluate the property and determine that it does not meet the loan-to-value ratio (LVR) requirements.

The lender can evaluate the property and determine that it is not an acceptable type.

Your financial circumstances change (job loss, reduced working hours, etc.)

Before applying for a home loan online, check that your records are up to date and in a readable format that is accepted by the lender. If there are inaccuracies in your application, such as the length of employment or the number of assets, this can lead to rejection.

It is also important that you check the lender’s eligibility criteria before applying. Not only can this help improve your chances of approval, but it also reduces the risk of the lender rejecting your application, which can affect your creditworthiness.

Benefits of Online Mortgage Pre-Approval

One of the main advantages of online pre-approval for mortgages compared to visiting a local branch is the speed at which your application is examined.

Online application processes can scan your documents and read your application immediately. This means that some home loan lenders can advertise online for pre-approval in 15 minutes.

Note that pre-approval and unconditional approval are separate and the latter can take several working days after a property has been valued.

And while the online pre-approval process for your home loan may only take 15 minutes, provided you have your documentation ready, the actual pre-approval time doesn’t take very long.

Most lenders offer pre-approval for home loans for 2-3 months. It is not perpetual, and it benefits everyone as your personal financial circumstances can change during this time (for better or for worse), as well as the home loan market itself.

You may find that your first pre-approval is about to expire, but because of a recent recruitment, for example, you are eligible to be approved for a larger amount of credit. Or the home loan market may have shifted and interest rates have come down.

If the process of applying for a home loan – whether in-store or online – is tedious, it may be worth seeking help. RateCity may be able to help you find a qualified broker near you to assist you with your application today.

source https://www.cassh24sg.com/2021/07/13/can-you-get-pre-approved-for-a-home-loan-online/

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cassh24sg · 4 years ago

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New lender Nano aims to put ‘outdated’ home loan process to shame with digital spin

As hundreds of thousands of Australians who take out or refinance new home loans each year attest, applying for and getting approved for a loan can often be painful.

New research by digital lender Nano supports this sentiment: three in four Australian homeowners admit their frustration with the “slow” and arduous mortgage process.

However, one of the country’s newest lenders, Nano, which was launched last month, is on a mission to highlight the flaws in the “outdated” home loan process. To begin with, the fintech launched its own inaction figure – a manifestation of the parts of the process that homeowners dislike.

According to nano research, the confusing jargon (72%), the slow process and hidden fees (55%), and the excessive paperwork (48%) were among the major annoyances.

“If you’ve ever had a home loan, you probably know The Inaction Figure and what it represents. Lenders are stuck in the past and drowning in paperwork, outdated technology and processes, ”says Nano Co-Founder and CEO Andrew Walker.

“There has been no innovation for decades, which means that the industry is sitting on old technology, old products, old processes and ultimately that means that the customer is still doing the heavy lifting.”

“You’re not going to ask anyone on the street what they think of the current mortgage process and then get a double thumbs up in return.”

The fastest home loan in the world?

In recent months, the volume of new home loans taken out by Australian buyers has skyrocketed, with ABS adding $ 32.6 billion in new loans in May alone.

While this has been a boon to lenders, the sheer volume of loan applications received has also put pressure on application and approval processes. As a result, there have been many reports of slower processing times.

So how long does the process usually take? According to nano research, one in two Australians said it took up to four weeks to get a home loan approved, while another in five said it took up to two months.

Enter nano. While the fintech isn’t the first Australian lender to take on long mortgage applications and approvals, its fully digital process aims to cut those times down significantly.

“We have developed a seamless home loan application and approval process. For example, we know it’s a world first – it’s the fastest mortgage approval process in the world that we’re pretty proud of, ”says Walker

“So far, the fastest loan application to unconditional approval – the end of the application, the credit check and the ID process – took 9 minutes and 41 seconds.”

Walker says the speed and simplicity of the process are beneficial to both Nano and its mortgage applicants.

“It benefits us because the shorter the process and the more automation you have, the lower the operating costs, which means we can offer our customers lower prices. We don’t expect customers to do the heavy lifting either – we think it should be a process that isn’t lengthy, obscure, confusing, or where they have to do all of the work. ”

Coping with refinancing sluggishness

As part of its final home loan research report released in December 2020, ACCC urged Australian mortgage holders with older home loans to reassess their interest rates in light of the significant amount of money they could save.

Despite this prompt, and despite what is currently the lowest mortgage interest rate ever, only a small percentage of homeowners regularly switch their mortgages. A recent numbers crisis at Mozo revealed that around 470,000 mortgages were refinanced in the 12 months to March 2021, which is about 8% of total mortgages in Australia. ^^

But what is behind this “sluggishness on home loans”?

Walker believes there are three main areas that matter: customers’ knowledge of their existing tariffs and fees compared to other offers, the monetary benefit they will get by switching, and the effort they will have to actually switch.

“We think we’ve solved all of these things,” he says. “We are completely transparent, our savings are substantial enough to see the benefits of switching, and thanks to our application and approval process, which can only take 10-20 minutes, the effort for the employees is kept to a minimum.”

With floating rates of 1.99% (1.99% comparative rate *) for owner-occupiers and 2.29% (2.29% comparative rate *) for investors, Nano’s variable mortgage rates are among the lowest in the Mozo database at 75% -Value Ratio (LVR) level.

The owner-occupier rate is also significantly 121 basis points below the average variable interest rate in the Mozo database of 3.20% for owner-occupier loans with a maximum LVR of 75%.

To put this difference in perspective, a owner-occupier able to refinance their existing home loan balance of $ 400,000 from an interest rate of 3.20% to 1.99% would reduce their monthly repayments by $ 237 to 56,883 Save USD in total interest over a period of 20 years.

Currently, however, nano home loans are only available to owner-occupiers and investor-refinancers, but Walker says they will be available for new purchases later this year.

RELATED: Do You Have an Energy Efficient Home? Loans.com.au has a discounted rate on home loans

To learn more about Nano’s mortgage offering, including all of its related features and tariffs, read our variable home loan review.

Otherwise, check out the table below to see how it fares against some of the great offers for refinancers, or visit the Mozo Refinance Home Loan Comparison Center to compare even more offers from a wider range of lenders.

^^ Refinancing figures from the ABS Lending Indicators from January 2021 and mortgage figures from the APRA report on loan deferrals from February 2021.

* ATTENTION: This comparison price is only valid for the given example (s). Different amounts and terms lead to different comparison rates. Costs such as redemption fees or early repayment penalties as well as cost savings such as fee exemptions are not included in the comparison rate, but can influence the cost of credit. The benchmark rate shown is for a secured loan with monthly principal and interest payback for $ 150,000 over 25 years.

** The initial monthly repayment numbers are only estimates based on the specified interest rate, the loan amount entered, and the term entered. Prices, fees and charges, and thus the total cost of the loan, may vary depending on the loan amount, loan term and loan history. The actual repayments will depend on your individual circumstances and changes in interest rates.

^ See Mozo Experts Choice Home Loan Awards information

Mozo provides general product information. We do not consider your personal goals, your financial situation or your needs and we do not recommend any particular product to you. You should make your own decision after reading the PDS or the offer documentation or after seeking independent advice.

While we pride ourselves on covering a wide range of products, we don’t cover every product on the market. If you decide to apply for a product through our website, you are dealing directly with the supplier of that product and not with Mozo.

source https://www.cassh24sg.com/2021/07/13/new-lender-nano-aims-to-put-outdated-home-loan-process-to-shame-with-digital-spin/

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cassh24sg · 4 years ago

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7 Major Reasons to Avoid Bad Credit

Many people know that having a bad credit score decreases their chances of getting a loan.

While that’s true, it doesn’t stop there. From missing a mortgage to buy your dream home to paying higher car insurance rates, bad credit makes life difficult.

Unfortunately, bad credit isn’t easy to fix. Improving a bad credit score takes time, depending on your current status. For example, if you are late in payment, it could stay on your credit report for up to seven years.

There are steps you can take to improve your credit score, such as using a secured credit card and working with a financial advisor. However, it is better to maintain your credit rating so you don’t have to struggle.

Here are seven reasons why you should avoid bad credit:

1. You become a financial risk

Before a lender approves a loan, they want to know whether you are in good financial condition. After all, a loan is a form of debt that must be paid back. If a borrower fails to repay the loan, they default on payments and the lender suffers a blow. Because of this, lenders aren’t exactly racing to let in bad credit borrowers.

Whether you’re looking to buy a car or a new house, a low score makes both of those things difficult to do. Even if you can get a loan, the lender will most likely charge a high interest rate.

2. Your credit card options are limited

Bad credit makes it difficult to get approved for a credit card. You may be thinking, “Good! Credit cards cause debt! ”True enough. But the quickest way to improve your credit score is with a credit card.

Even if you can be approved for a bad credit card, you will most likely have a high interest rate. You are also less likely to be approved for a card with rewards. But there’s good news: a secured credit card can help improve your score with minimal risk.

Unlike a regular credit card, a secured credit card usually requires a cash deposit. Before being approved, you will need to deposit money, which is usually the amount of credit. For example, if you make a deposit of $ 1,000, your credit limit is $ 1,000. If you miss a payment, the credit card issuer will use the money from your deposit to cover the cost. This makes the likelihood, if not impossible, of going into debt.

3. Buying a home is difficult

There are three common loan options when buying a home: VA, conventional, and FHA loans. VA loans are for veterans or active service members only. Traditional loans usually require a credit rating of 620 while an FHA loan requires a credit rating of 580.

According to FICO, a bad credit score is between 300 and 579. If your score is in this range, getting approved for any of the loans above will be challenging. With a larger down payment, you may have a better chance of getting approved with a lower credit score – but there are no guarantees.

4. Even renting it can be a challenge

Not only does poor credit make it difficult to get a loan, it also leaves you with fewer rental options. Like lenders, landlords want to know that you can afford monthly payments. Because of this, they will check your creditworthiness before approving your application.

If your credit score is low, your landlord can deny your application altogether. Alternatively, they may suggest that you find a co-signer who could be held legally responsible for any payments you miss.

5. You pay higher deposits for utilities and cellular phone contracts

If you have bad credit, you may find it difficult to set up some of your utilities. In fact, some companies charge a large down payment to people with poor creditworthiness. This allows the company to use the down payment on the balance if customers fail to pay the bill.

Even a cell phone contract can be difficult to come by if the credit rating is poor. Before a consumer concludes a new contract, mobile operators usually check their credit. The worse the credit rating, the higher the risk for the customer and the lower the likelihood that he will be approved for the contract.

6. You have higher auto insurance rates

This may come as a surprise, but some insurers charge higher car insurance premiums for those with poor credit ratings. Why? Because insurance companies associate poor creditworthiness with a person’s likelihood of making a claim.

Bad credit ratings increased insurance rates by 61%, according to one study.

7. You could miss out on your dream job

The main focus when applying for a new position is on polishing your resume and mastering your interview. It turns out that you should focus on something else – your credit report.

In a 2018 report, the National Association of Background Screeners found that 95% of companies are doing some kind of background screening of their prospects. Sixteen percent of these companies run credit checks on all candidates, while a third do at least some credit checks. If you are one of them then you should make sure that your report matches your application.

You may be wondering why an employer checks your credit report. One reason is for security reasons. You want to validate your identity, education, and background. But there’s another reason – they want to see how financially responsible you are. For some particularly sensitive posts, you may even need to determine if financial pressure makes you vulnerable to blackmail.

To prepare for this inquiry, make sure you know what it says on your credit report before applying for a job. That way, you can fix any inconsistencies and be ready to explain any problem areas that you are working to resolve.

While there are ways to fix bad credit, it is far preferable to avoid them in the first place. Use your credit in a sensible and sensible way and take special care to settle your bills reliably. If you pay on time and live within your means, you will have the credit standing you need for your best life.

source https://www.cassh24sg.com/2021/07/13/7-major-reasons-to-avoid-bad-credit/

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