Smith | 29 Jul 2013
A bankrupt former mortgage giant will have to pay $230m to borrowers in an enforcement action by the Fed.
The Federal Reserve Board on Friday amended an enforcement action from earlier this year, announcing that it will require GMAC Mortgage, which entered bankruptcy last year, to make approximately $230m in cash payments to mortgage borrowers. The Federal Reserve said the enforcement action was due to "deficient practices in mortgage loan servicing and foreclosure processing".
The amendment will see payouts to more than 232,000 borrowers whose homes were in any stage of foreclosure in 2009 and 2010 with GMAC. As a result of the amendment, which was approved by the bankruptcy court overseeing bankruptcy
proceedings involving GMAC, independent foreclosure reviews on GMAC borrowers will be halted.
The Federal Reserve Board said accepting a payment will not preclude borrowers from taking action related to their foreclosures, noting that servicers are not permitted to ask borrowers to sign a waiver of any legal claims they may have
against a servicer.
If you are looking for money for your business than you will be happy to know you only need one "C" to qualify.
In lending when we look to see if a client is fundable we are looking for one of the 4 "C"s. You don't have to have all of the 4 Cs, only 1 to secure funding.
The first C is Cash Flow. When you have an existing business with good cash flow you can qualify for business funding.
If you do have verifiable cash flow this substantial increases your chances of being approved for funding.There are
many funding programs you might qualify for including Business Revenue Lending.
If you don't have cash flow your business still might have Collateral, the second C. Collateral for your business is really your business assets. Many things can be used as collateral including equipment, purchase orders, even account receivables. Having Collateral greatly increases your chances of being approved.
If you don't have cash flow or collateral, don't worry you still can qualify for business funding. Lenders also look at your business Credit to qualify you.Business Credit is our third C. Lenders will lend you money with no personal guarantee based on your business credit profile and score. If you have a good business credit profile you can use that as security to obtain funding.
If you don't have business credit built now, call me so I can help you quickly build an excellent business credit score and profile. Maybe you are just starting a new business, and you have no business credit, cash flow, or collateral. In this case you can still qualify for funding. But lenders will use your personal Credit to qualify you.
Personal Credit is the fourth and final C that lenders will look at to approve you for funding. You can secure credit lines, through me, up to $250,000 with as low as a 650 credit score.
These types of unsecured credit lines do not look at revenue or financials. Your credit is all that is used to qualify you for funding. If you don't have good credit, call me. I can also help you insure you have an excellent personal credit profile to secure funding.
All you need is 1 of the 4 "C"s to qualify. Contact me and I will help you secure money for your business.
If you are a business owner - even if your credit is flawed and you own no commercial real estate - you can borrow between $25,000 and $150,000 based solely on your signature! Some of the uses can be to bolster liquidity, to pay for third party costs - like appraisals, inventory, environmental reports, - or for any other business need.
Using this program, you can get as a business owner money within just three to five business days without any collateral. There are no up-front fees to get this loan.
There is no requirement to own commercial real estate either. Your borrower could just be renting commercial space.
There are no mortgage or UCC costs or liens. It is strictly a signature loan. Credit can be as
low as a 500 FICO to qualify.
The key issue with this program is that the borrower must own a business. He can borrow up to 10% of his annual sales / revenue.
A buddy of mine used this program to get his client a quick $50,000 when his client's credit deteriorated so badly that his SBA loan was turned down.
This program was also used recently to raise the money for third party reports. In this case, the borrower owned commercial real estate, and he was trying to borrow almost $500,000
secured by his industrial building. The problem was that the borrower's cash flow was so overstretched at the moment that the borrower couldn't come up with the $6,000 he needed for the appraisal and toxic report. This borrower was able to use this quick, unsecured commercial loan program to borrow the money necessary to eventually obtain a $500,000 commercial real estate loan!
The paperwork requirements are pretty easy too - just a 1003 loan application, a credit report, 12 month's worth of bank statements for the company, and last year's company tax returns. As I mentioned earlier, there are no application fees, and your client will have an answer within just 3 to 5 days.
A word of caution! The money is expensive, but if you as an owner - borrower desperately needs the dough, this program can be a lifesaver.
Got a potential deal? Please send me an email at email@example.com with your contact information and a brief description of the deal. In the subject line, please type, "Dan's Special Unsecured Business Loan."
Our Inventory Financing is a perfect way for you to get money for your business if you own more than $150,000 in inventory now.
With inventory financing you can use your inventory as collateral and quickly be approved even if you have personal credit challenges now.
Plus you get to enjoy generous payback terms and loan amounts, insuring your payments are affordable. You can be approved for one hundred and fifty thousand or more in inventory financing with us. Your approval amount will be based on the actual value of your inventory.
You can typically be approved for financing up to 50% of the value of your actual inventory. And interest rates on this program are very low, typically as low as 2% monthly on the outstanding loan balance. Plus you can be approved in 3 weeks or less.
To be approved you should have at least $300,000 in inventory. No jewelry, apparel, highly seasonal items, or high tech items subject to rapid obsolescence will be accepted. Our Inventory Financing is a perfect way for you to get money for your business if you own more than $150,000 in inventory now.
Your money is waiting, contact me directly so we can get you access to your own finance suite and start putting $$$ in your pocket today. With 30 core programs and thousands of participating lending sources we have or possibly can create a program that fits your needs.
I saw this follow up story on Money Talk News and I had to post it because it's another example of the creative measures banks are taking to pick the pockets of the people who can lease afford it.
July 5, 2013
By Brandon Ballenger
I wrote about a woman who sued her employer for paying her by prepaid debit card. It turns out that payment method is pretty common, and not necessarily optional. In many instances, it’s at least the default choice, The New York Times says:
At companies where there is a choice, it is often more in theory than in practice, according to interviews with employees, state regulators and consumer advocates. Employees say they are often automatically enrolled in the payroll card programs and confronted with a pile of paperwork if they want to opt out.
Taco Bell, Walgreens, Walmart and dozens more offer this payment method, the Times says, and it’s gaining popularity with employers. Last year, $34 billion was loaded onto 4.6 million payroll cards. Those figures are expected to more
than double by 2017.
Bank of America, Wells Fargo and Citigroup, among others, pitch payroll cards as convenient for employees. But the truth is, they’re cheaper for employers, the Times says, and some banks even pay employers, per head, to enroll people.
Citibank pays the New York City Housing Authority $1 per person, the Times says.
The cards shift the financial burden of processing payment onto the employees. There are often fees for everything from an ATM withdrawal to a balance inquiry to inactivity and card replacement. Added up, these costs associated with just receiving a paycheck put many employees below minimum wage, the Times says.
Banks defend the fees by saying they’re cheaper than what someone who doesn’t have a bank would pay — even though fees are one good reason those people might avoid banking to start with.
“Someone cashing a payroll check for $500 would end up paying $15 at a 3 percent check-cashing fee,” Citigroup spokeswoman Nina Das told the Times.
My ears hear that as: We screw minimum wage workers more gently. (Though in some ways, banks are little different from payday lenders.) How can this be a fair method to pay someone for their work?
Accion Texas Inc.’s Lending Data Helps Researchers Prove That Credit Greatly Increases Entrepreneurial Survival Rates, Sales Growth and Job Creation in the United States
SAN ANTONIO — Gearing up for Small Business Week June 17 to June 21, the nation’s largest nonprofit microlender, Accion Texas Inc., announces the remarkable outcome of a recent academic study: “Startups receiving funding are dramatically more likely to survive, enjoy higher revenues and create more jobs.”
That’s the conclusion of four university professors who have published their results in a research paper titled “How Much Does Credit Matter for Entrepreneurial Success in the United States?”
“Obtaining a loan has a strong effect on the future financial position of startups,” wrote the researchers after analyzing client data collected by Accion Texas from 2006 through 2011.
“Receiving a loan increases the probability of survival by 44 percentage points, which is an enormous effect,” said Mark J. Garmaise, associate professor at the University of California’s Anderson School of Management. “Loan provision also increases firm revenues and employment.”
Garmaise worked with Cesare Fracassi and Shimon Kogan, both assistant professors of finance at the McCombs School of Business at the University of Texas Austin; and Gabriel Natividad, assistant professor of management and organizations at the New York University Stern School of Business.
The researchers also analyzed survival rates and loan provision for specific groups to determine who might benefit the most from receiving a small business loan.
“We find that the biggest benefits go to applicants with at least some college and those without previous senior management experience at another firm. The latter group probably can secure financing from other sources and therefore the Accion Texas loan has a smaller impact on their eventual success,” the report concluded.
The four researchers studied data on 5,400 Accion Texas applicants by accessing the organization’s proprietary Microloan Management Services™ - the only small business loan underwriting platform of its kind in the United States.
Key findings include:
The full study can be downloaded from this web address: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2157707
About Accion Texas Inc.
Accion Texas Inc. is a nonprofit, multi-state micro- and small business lender that helps new and existing entrepreneurs successfully grow their businesses. Through affordable lending and business development services, Accion Texas Inc. is committed to empowering diverse individuals and small businesses that have limited access to traditional sources of capital.
Accion Texas Inc. manages the nation’s largest microloan portfolio and operates 20 offices in eight states: Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Missouri, Tennessee and Texas. The organization is the largest member of the Accion U.S. Network. Since its founding in 1994, Accion Texas Inc. has disbursed more than 13,400 loans totaling $143 million and helped to create or retain more than 10,500 jobs.
Well, I saw this article in the MPA by Kelli Rogers | 01 Jul 2013 and I thought it was interesting enough to repost.
Bank of America has joined the growing trend of financial institutions offshoring mortgage BPO to cut costs, according to a new report.
Bank of America has opened a unit in India to review home-valuation reports as it seeks to rebuild share in U.S. mortgages at a lower cost, according to Bloomberg reports.
Workers in the new Bangalore office follow checklists to determine if appraisals are complete, several people who requested anonymity told Bloomberg. The firm also eliminated jobs of licensed U.S. workers in its LandSafe business, the appraisal division of the Charlotte, North Carolina-based company, which made $78.7 billion in loans last year, the people said.
In February, BofA cut about 5% of LandSafe employees, saying they weren’t needed as overdue loans fell. Licensed reviewers, who check the accuracy of appraisal valuations and can earn more than $100,000 a year, were among those who lost their jobs, according to reports.
The trend to move mortgage BPO offshore is largely driven by banks’ need to reduce costs, and the labor cost in India is, spending on skill level, approximately 50% less than in the U.S., according to Judy Wheatley, senior vice president of
compliance for Indecomm Global Services, a consulting and outsourcing company.
Lenders are under greater pressure than ever to reduce costs because demand for refinancings, the biggest source of volume for the firms, is falling amid surging mortgage rates.
“The mortgage industry is cyclical with ups and downs, so what outsourcing allows companies to do is to staff internally at a certain level, and utilize outsourced resources to flex up their volume and meet consumer demand faster,” Wheatley said.
Bank of America, once the biggest U.S. mortgage lender, spent more than $45 billion to settle disputes tied to defective mortgages and foreclosures, so it may come as little surprise that the company has plans for an aggressive cost-cutting
scheme, with CEO Brian T. Moynihan planning to save $8 billion a year.
Other firms have added staff in lower-cost cities. Goldman Sachs Group saw headcount in places including Bangalore and Salt Lake City almost double since 2007 to 22% of employees, CEO Lloyd Blankfein said in November.
Trevana Properties is a placement company working with a variety of hedge funds, REIT's, commercial banks, specialty boutique lenders, private investors and other funding sources not widely known to the general public.