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Serving A Terrible Blow to The Idea of Fast Cash Online, Justice Supported the Debt Collection Companies in The Debt Collection Case

On Monday, it is ruled by a divided Supreme Court that no one can sue the debt collection companies if they attempt to recover credit card debt of years old from those who look for bankruptcy protection. To be more specific, according to the Supreme Court, no debt collection companies can be sued while trying to recover their years-old debt of credit card from people seeking bankruptcy protection. The justices ruled this verdict 5 – 3 in favor of the Midland funding. Though the fast cash online seems to be a great solution to get quick cash, still, with this new verdict being ruled, the consumer groups have received a terrible blow.

Yes, the 5- 3 ruling is nothing less than a shock or a serious blow to the consumer groups, who often complain about the debt collection companies to mislead people unfairly into repaying the old debts, even though the consumers are not required to do so under the law.

The court finally sided with the Midland Funding on Monday. Midland Funding is a debt collection company that was trying to recover a debt of around $1879, which have incurred by an Alabama woman for more than around 10 years ago.  The name of the Alabama woman is Aleida Johnson who had argued that the debt collection company named Midland Funding was totally wrong to try to collect the debt. She also stated a reason behind her claim. According to her, the company has wronged because as per the law of Alabama, there is a six-year limitation statute for a creditor for collecting the overdue payments.

Based on this very reason, Aleida Johnson had successfully avoided paying the debt of $1879. According to a federal appeals court, Aleida could have sued the debt collection company for attempting to collect the debt, based on the existence of Fair Debt Collection Practices Act. It is based on this Fair Debt Collection Practices Act in Alabama that a money collection company can be sued as according to the Act, all the money collection companies are strongly prohibited from making any misleading, deceptive and false representation in any way or trying to recover the debt by any unconscionable or unfair mean. This particular law prohibits any attempt of the collection companies in trying to collect the debts outside the statute of limitations, which is, in this case, is around six years.

However, according to Justice Stephen Breyer, this Act doesn’t apply in case of bankruptcy proceedings. Yes, writing for the majority, and breaking with his liberal colleagues, Justice Stephen Breyer confirms that any effort made in order to recoup years old debt during bankruptcy do not violate the law or the Fair Debt Collection Practices Act in any way. He said that the attempts made by the money collection companies were neither misleading nor false as technically the bankruptcy law supports such claims.

Breyer also added that the attempt of recovering the debt by the money collection companies, such as in the case of Midland Funding, was neither unconscionable nor unfair, as a bankruptcy trustee definitely can object to claims which are so much old that they no longer have to be repaid. And it is exactly what happened in the case of Johnson’s, which also reduces the concerns of that of the consumers might unwillingly pay a years-old debt.

Justices Anthony Kennedy, Samuel Alito and Clarence Thomas along with Chief Justice John Roberts also joined the opinion of Breyer. Though, Justice Sonia Sotomayor considered the practice to be both unconscionable and unfair.

According to Sotomayor, professional debt collectors and providers of fast cash online, have built a business out of filing unfair claims in bankruptcy proceedings to collect the debt and buying stale debt, assuming that no one noticed it. The dissent passed by her was also joined by Justices Elena Kagan and Ruth Bader Ginsburg, while Justice Neil Gorsuch preferred not to participate in the case.

Mr. Cordray, It’s Time to Step Down to Let Payday Loans Online Providers Breathe

CFPB or the Consumer Financial Protection Bureau is a controversial agency and continues to remain polarizing. The US Court of Appeals for the District of Colombia recently declared that the structure of 1 director followed by the bureau is unconstitutional. In light of the criticisms and the voters’ desire for a modification of the status quo, CFPB need to refrain from pushing regulations about payday loans online providers before the presidents enters his office.

It is common trend for federal agencies to implement some last-minute regulations when a new administration takes over the government. These regulations are usually rushed and supported by low quality assessment of the benefits and expenses. Since CFPB’s regulation can influence the financial well-being of tens and thousands of Americans, they should take time and act in good faith.

For instance, the proposed regulations on payday lending and arbitration have sparked a lot of public interest. 1.4 million comments have been received by the payday rule, which ranges from legal and economic analysis to people’s personal stories about how they quite terrified about losing access to important products and services.

The CFPB needs some time to carefully consider and reply to genuine concerns highlighted by the commenters. The staff of the bureau will really need to work 24/7 to be able to sift through, review and analyze the 1.4 million comments internally before the new administration takes over the reins of the government. Scrutinizing the comments of the arbitration rule is going to take some more time. The bureau’s proposed rule on arbitration and payday lending is going to influence significant change in the financial services market and affect so many consumers, along with their accessibility to credit. The bureau should give it the attention and time that it needs.

CFPB need to exercise control to get the rules right and to maintain legitimacy. Originally, the bureau did not have any accountability to the president and the Congress. Its structure was recently held as an independent agency by the decision of a federal appeals court. The court even said that the director of the CFPB is the single most powerful official in the entire US government, next only to the president.

The problem was addressed by the court and it gave the president the power to sack the director for various reasons other than neglect of his duty. The president has the authority to oversee the work of the CFPB and fire the director, just like for any other agency.

The CFPB also need to avoid taking aggressive actions for the interest of legitimacy until the new president decided on who he wants as director for the bureau. The future of CFPB is uncertain, and therefore, any new rules will be viewed as an invalid attempt to dictate policies. This can lead to the rules being overturned by the new administration and can cause even more uncertainties in the industry.

Instead of putting the financial industry under whipsaw policy, the bureau and its director need to step away from the pen. CFPB should spend some time to work through the information that it has received as response for its proposed rules. This way, the new administration will be able to make better, informed decisions. The major goals of the bureau is to protect the customers and promote innovation and access in financial products and that does not change. The best way for the bureau at this moment is to wait before inaugurating and announcing the final policy regarding payday loans online industry. They need to really take the time to evaluate and assess the whole situation.

Latest CFPB Payday Regulations are not as much of a Slam Dunk as the Bureau Believes

As you probably already know, the Consumer Financial Protection Bureau has introduced a new rule that the Bureau believes will effectively put an end to what they call “debt traps” that consumers allegedly wind up snared in due to the payday lending industry. The regulation is more than likely going to be challenged by payday lending advocates, some political leaders and those who work in the payday lending industry. There are many opposed to not just the new regulation, but the Consumer Financial Protection Bureau itself. There are charges being leveled that the CFPB, an arm of the United States government, is unconstitutional in its structure and that it lacks the official authority to implement any type of regulations on the short term lending industry.

When considering the CFPB and its new payday lending rule, it is important to consider not just the structure of the regulation, but the potential obstacles that the Bureau is likely to face in getting the new rule pushed through and made official. There are questions that interested parties need to consider.

How will the proposed payday lending rule actually protect consumers from falling into “debt traps” that some people associate with the payday lending industry? The rule is very comprehensive. To read through all of it, you’d have to be prepared to scour over 13,000 pages. But for all of the details covered in the rule, the descriptions for what makes up an actual payday loan are a big generalized. Some types of short term loans are covered, as well as some longer-term loans. Lenders who make these types of loans will need to comply with the newly created ‘ability to repay’ requirement covered in the rule. This is something that mortgage lenders and credit card companies have had to adhere to for a long time, but is new for short term lending institutions.

This requirement will force lenders to look into the potential borrower’s income, debt situation and then find out whether or not additional debt will work for the borrower. Will the person be able to make the loan payment with their existing debt level? Additionally, this rule forces lenders to consider everyday expenses, like food, utilities and other expenses that borrowers have to deal with. Here’s where it gets sticky – the lenders have to not only make these inquiries, but they have to verify all of the information. This means they will need to get paycheck stubs, credit reports and other documentation about each and every person they have to process loan requests for. These additional checks will likely make the costs of making loans so high, and the overhead costs of running a lending company so unmanageable, that many lenders will have to drop out of the market.

Will the rules even provide new levels of protection to American consumers?

Some experts believe that the new rule will prevent borrowers from “rolling over” too many loans, and that this will prevent people from getting into situations where they are rarely able to realistically pay off the principle of their short term loans. However, the elephant in the room is the fact that if the new rule effectively closes the doors of the majority of payday lending companies, then lower income borrowers, and people with low credit scores will have virtually no access to emergency lines of credit. The traditional banks are of no help to consumers with low incomes and subprime credit when those people need to borrow a few hundred dollars to keep their heads above water. By protecting consumers from loans that they don’t like, while potentially preventing those same consumers from getting access to short term lines of credit, the CFPB has shown that they have not paid a whole lot of attention to creating any type of rule that would benefit American consumers in a realistic manner.

Making Smart Credit Choices: Requesting a Credit Limit Increase

People often get their first credit cards when they are young and have not quite established themselves financially. As such, it is easy to understand why so many people find themselves with lines of credit that have very low limits. It is not unusual for credit card companies to give new account holders lines of credit that are only for $1,000 or a little bit more. As people begin to progress a bit with their finances, though, they often need credit cards with higher credit limits. This can often prove to be a stalling point for some consumers, as they are not sure how to go about requesting a credit limit increase from their credit card companies.

Use Credit Responsibly

With so many financial experts suggesting that people avoid using credit cards, it may be difficult to understand why some people would want to increase their credit limits. If someone is responsible with their use of credit, though, it is very easy to wind up in a situation every month where they are utilizing a large percentage of their existing credit. Some people like to charge purchases, like gasoline, groceries and other common items, and then to pay off their credit card balance entirely when the payment comes through. If someone only has a $1,000 limit, and spends $500 on the card, they are regularly going to be at 50 percent credit utilization. That is something that can lead to a lower credit score. Suffice it to say, that everyone should use their credit responsibly and should make efforts to pay off their balances in full – or as close to that as possible – every month. Only then, should you seek to get an increased credit limit.

You’re Not Asking for a Favor

People often get intimidated when calling to talk to representatives from their credit card companies. They believe that if they say the wrong thing, they will get turned down flat, or that if they don’t mind their p’s and q’s that they will wind up getting slapped with a higher interest rate or something. Nothing could be further from the truth. You are the customer, and they are making money from supplying you with a line of credit. You never have to feel nervous about approaching a credit card company, be it to ask for a different payment date, to negotiate a lower interest rate or, in this case, to ask for a higher credit limit.

It’s Easier than you think

Most of the time, you will not even have to speak with anyone to get this done. All the major credit card companies have online portals that allow you to access your account. Typically, there is a link that you can access once you are signed in that will allow you to request a higher balance. Use this link. You will be taken to a form that asks you the reason for needing a higher credit limit. For example, the company may want to know if you are doing so to transfer another balance or to make a large purchase. Be honest, and fill out the form entirely. If you qualify, you will get a notification from the credit card company.

However, if you get turned down, you may want to call their customer service department directly. Speak to the representative professionally, and explain why you need a higher balance. If they turn you down, ask to speak to their manager or supervisor, then repeat your request. It may take a couple of calls, but if you persist, and have a valid reason for needing a higher credit limit (like the fact that you are making a lot more money now than you were when you got it, and want to avoid high credit utilization) you should be successful.

The Clock Runs out on Proposed Payday Lending Regulation in Nebraska

A new change to the payday loan regulations in Nebraska – a change that was endorsed in full by the Greater Omaha Chamber of Commerce, along with TD Ameritrade – has died out. This proposal would have changed the payday lending rules in big ways, but will not wind up taking effect any time soon. The bill – 1036 – was introduced by way of State Senator Kathy Campbell from Lincoln. It was designed to cap interest rates on payday loans at just 36 percent. This cap represented a major reduction from where the loan fees – when amortized for an entire year – currently stand.

In addition to APR caps, the bill was also aimed at changing the way debts are collected, while requiring more reporting to be done on the payday lending companies doing business in Nebraska. However, the payday lenders can breathe a sigh of relief, since the overhaul failed to get past the Nebraska Legislature’s Banking and Commerce Insurance Committee. This means that the 60 local payday lending locations in Omaha, and more than 90 throughout the state will operate per usual for the foreseeable future.

Senator Jim Scheer is from Norfolk and is the chair of the committee. He indicated that time was a real factor with regards to the folks supporting this bill. Those same folks met a roadblock when it came to a relatively shorter legislative session. The session this year is 60 days, while the following year will be 90. Session days alternate every year. If the senator does not name a particular bill as being a priority it will more than likely not make it out of the committee. The bill is then to be talked about on the full Legislature floor. Campbell did not indicate that the payday loans bill was a priority.

Sheer said, “It got past the point of being named a priority bill, and without that designation, it had no vehicle to get anywhere on the floor.  It didn’t make much sense from the committee’s standpoint to move it into the general file if it wasn’t going to go anywhere.”

When the 90 day legislative session rolls around there may be more time for discussions and amendments to the bill via negotiations submitted from both opponents and supporters. In a 60 day session, though, lobbyists and other interested parties do not have as much time to arbitrate and come up with solutions. This process proves disappointing to those who have a stake in the proposal.

The executive director of the Women’s Fund of Omaha Michelle Zych said, “Quite frankly, we were really surprised that it didn’t make it out of committee.” Zych’s group was the organization that originally pushed for the new regulations. Her supporters criticized the fees that are currently permitted on Nebraska payday loans. They believe that there are not many other states that will allow these higher rates, and that the fees currently contribute to consumers getting stuck in “debt traps.”

Opponents of the reform, like Brad Hill said that the industry is already sufficiently regulated and that borrowers are stopped from rolling over loans that they cannot afford to pay back in time. Hill then told the hard truth that many people don’t want to hear about: the fact that people who need small dollar loans do not have anywhere else to turn, other than to local payday lending locations or to online lending companies. Time is on the side of the payday lenders in Nebraska, for at least a little longer. Both opponents and proponents of the regulation will likely turn out in force when the time for the 90 day session arrives.

The Facts about Payday Loans for College Students

The college experience is, for many, the first time that a person strikes out on their own and achieves a greater measure of independence. Oftentimes, though, students are not prepared for what it means to be somewhat “financially independent” when they are also just getting started and trying to earn a degree. There is no doubt that many college students, even those who come from well-to-do families, often find themselves broke and in desperate need of cash. This all begets the question of whether or not payday loans for college students are a good financial alternative.

People who are strapped for cash often find that payday lenders are their only alternative when they need to get funds for emergency expenses. There are tens of thousands of lower income, working class households in this country that depend on the services that payday lending companies provide. It should come as no surprise, then, that college students are seeking out payday advance loans at a higher rate these days. Many college students are on their own, as it were, and they oftentimes cannot turn to their parents for any extra cash. Mom and dad are probably already paying a lot for their offspring’s college education. And with so many college students being young and not having a proven track record with credit, college students often have very low credit scores.

A low credit score can immediately disqualify a borrower from getting loan approval from banks or credit unions. This does not, however, negate the fact that students need to have access to cash to get by from one week to another. There is food to by, expenses to pay and a whole host of other financial obligations that college students have to deal with; just like the rest of us. But is seeking a payday loan the best path for college students to take when they need access to fast money for emergency expenses?

The Right Kind of Payday Loan Applicant

Everyone really has to make their own choice about whether or not they should get a payday advance loan. But there are some criteria that student applicants should be aware of if they are planning on getting a payday loan. Here are some of the things that students should consider before they apply for a payday cash advance loan:

  • Is the student borrower employed? Payday lenders only provide loans to people who are employed and brining in a regular income. Because payday loans are typically paid back from the pay check of an applicant, there is no use in students without jobs applying for these types of loans.
  • Does the student have a checking account? Payday lending companies typically use either a postdated check or an automatic withdrawal from a borrower’s bank account. Any student who wishes to get a payday loan should make sure that they have a valid bank account.
  • Is the financial need relatively inexpensive? Payday lenders typically provide loans that run between $100 and $1000. In other words, payday loans shouldn’t be used to pay back student loans or to take care of larger debts. Typically, these types of loans are used to help pay for things like car repairs, emergency medical bills or simply to give the borrower enough cash on hand to get by until they get paid at work again.

Students should consider all of the information that we just shared to determine if they can/should get a payday loan. Payday loans do help young people to understand how important it is to pay back debts on time, and when used responsibly they can be a great financial help for working students who need fast cash for expenses.

The Average Credit Card Debt in America

All of the new and upcoming technological advances in the financial industry have gone a long way toward changing our society into more of a cash-less society. The bottom line is that many consumers are turning away from using cash and using credit or prepaid debit cards to make purchases. Even minor things, like getting coffee every morning, are winding up on some peoples’ credit cards, and the result is consumer debt accruing like never before.

iStock_000014696238XSmall-300x225Credit Card Debt is on the Rise

The United States is just starting to get back to a place of relative financial stability. After the last Great Recession, you would have thought that people would have learned their lessons about avoiding debt when it is at all possible. That doesn’t appear to be happening, though, as credit card use is rebounding, with the Federal Reserve announcing that Americans owe in excess of $880 billion dollars in revolving credit as of this past October.

All that debt is great news for the big credit card companies, but it’s not necessarily good news for the average consumer. As those big credit card companies continue to rack up profits like never before, all of that excess debt can leave the average person scrambling to make payments on time and can actually lead to people suffering from lower credit scores than they ought to have.

How do you compare?

A recent study by Credit Karma revealed that about half of its 30 million online members have credit card balances that equal 40 percent or more of their credit limit. That is not good news, since the big credit bureaus are known to penalize consumers when their credit card balances go above 30 percent of the credit card limit.

So what are the penalties that get handed out? Lower Credit Scores! And once someone has a lower credit score, higher interest rates are soon to follow. Those higher interest rates can wind up costing the average consumer thousands of dollars over the years. Even worse is the fact that lower credit scores can lead to people getting denied mortgage loans, auto loans and even jobs or better insurance rates.

How much of an impact can a lower credit score have on your finances in the future? Let’s say you were borrowing around 165 grand to buy a house. With a 4.5 percent interest rate you would wind up paying over 130K over the life of a traditional 30 year mortgage. But if you had a lower credit score that resulted in you paying 5 percent interest instead you’d wind up paying over 150K on the same loan. Just a half point difference means that you’d wind up paying nearly $18,000 dollars more than you would have if your credit score was higher…

That extra almost $18,000 could have been invested in your savings for retirement, used to purchase a new vehicle or even used as college tuition for your kids, instead of getting that extra money, though, too many Americans are simply racking up the credit card debt like never before…

Here’s what everyone needs to do if possible. Pay off high interest credit cards as quickly as possible or negotiate with the credit card companies to get lower interest rates. And never, ever allow your credit card debt to exceed 30 percent of your credit limit on any card. Finally, pay cash or use prepaid debit cards to pay for things instead of putting them on the credit card. Small purchases add up to bigger payments and more debt that most of us simply don’t have the financial wherewithal to deal with over the long haul.

Getting Out of a Sticky Situation

Being financially stable is something we all strive to accomplish. Unfortunately, life isn’t always that kind to us. One day, we can be living a great life, the next day we can be jobless and stressed out concerning how we are going to pay our upcoming bills. Fortunately, there is always a way out when it comes to you not having enough money to pay your monthly bills. Faxless Cash Advance Loans can get you out of a sticky situation when needed and can help you get you back on your feet.

Qualifying for a Loan

Car crash
Car crash (Photo credits: www.myparkingsign.com)

Unexpected Emergencies happen all the time. Whether you or your spouse get into a car accident, or your water heater needs to be repaired. Many people live on a fixed budget, so there are times when you need Fast Cash. Borrowing money from a bank may not be an option for people, especially with the high Bank Fees. Another reason that they may not be able to borrow from a bank is that they may not qualify for loans. Nowadays, the guidelines have changed, and they have become more stricter in who can qualify for such a loan.

Terms of a Loan

Payday Loans make it possible for you and your family to be able to get out of emergency situations. Following a budget is very important to many people. So, when we have unexpected things occur, and you don’t have money to pay for things, then looking into a loan could be a life saver for you. Look at the terms of that loan, make sure that you are able to pay it off within the time line given by the loan.

Finding a Way Out

We are not in control of accidents, and we cannot predict when things are going to go wrong in our lives. People get laid off from their jobs all the time. It is unfortunate, but it is a reality. If you are able to save for such emergencies on a monthly basis, then that is advised. If you cannot put money aside for such things, then know that there is a way out if you ever need it. That way involves cash loans.

Getting Things Done Slowly

One of the most important things that you can do in your life is to take things slowly. While it is nice to think that you can jump onto a situation and make it right, the truth is that, well, going about something quickly is not always the way to get it properly taken care of. Take an unexpected financial emergency for example. While it is nice to think that you can get a situation taken care of within a matter of a couple of minutes, the fact is that you never want to rush into a situation when you don’t have to. Even if things tend to look a bit “murky”, it is important to recognize that you at least have the time to do your research in order to get the outcome that you are looking for. When it comes to getting the money that you need to pay off a monthly bill, you need to really look at what your options are for Payday Loans.

Taking Time To Look

All it takes is a couple of minutes to learn about what you are going to need for a payday loan. Info is available both online, and with the professionals who give said loans. It is not just about going out there and trying to get a loan quickly, it is about making sure that you take the time to figure out a loan that is going to not harm your financial future. After all: you want the type of loan that is going to give you the money that you need, not fees and penalties that will harm you for months on end.

Why Payday Loans Make Sense At Times

affiliates_bgWhen you need money to pay off a bill, it is important that you are able to take the time to figure out what the right type of loan is for you. With all of the loans that are out there for you, it is important that you don’t rush into taking just any loan that is out there. When you are looking for a loan to take care of an unexpected bill, you want to take a look at what Payday Loans can do for you. Here are four items you should know about a payday loan:

You Can Get The Exact Amount Of Money You Need

Why take out more money that you need, especially when you know you are going to have to pay it back for interest. When you get a payday loan, you need to make sure that you are able to get the exact amount of money you need, typically between $100 and $2500.

You Are Borrowing Your Own Money

Because you are getting the loan based on your next paycheck, you are essentially borrowing your own money, with the idea that you can pay it back when you get your paycheck.

You Can Get It Quickly

Payday loans can typically be completely in a couple of hours. Why wait days for a loan when it is only going to make a financial issue worse over time.

You Pay It Off Quickly

Because you can pay it off with your next paycheck, you don’t have to worry about an extended payoff which can cost you a lot of money in fees and penalties.