Ways to Work Works Its Way to DC

As the economic crisis gets the better of some United States residents, a program was formulated to help struggling Americans with in getting the car they need to be more efficient with their work. Ways to Work was introduced by the government to the public last April 10 with the help of Family Matters of Greater Washington a Non-profit organization.

Those who wish to get into the program and get money to purchase second hand cars are first given a lesson about finance. After they become financially literate, they are taught the importance of good credit; they are taught how to get better credit and taught how to set standards and budgeting.

The customers are also referred to automobile dealers, they inspect the car’s condition and they get it protected. The program is only available for citizens that have been employed for at least 6 months, who has a not-so-good credit status and can be capable in paying back the loan.

The main goal of Ways to Work is to help fight against abusive loan practices and help alleviate the lives of those individuals that have no choice but to commute through the busy and dangerous streets of the city.
It was first introduced to the public in 1984.

According to customers, the program was the only one of its kind. They were not only satisfied that they got a loan for the car they needed to operate in work, they were also enlightened about the ways they can improve their credit score and turn their lives around for the better.

The program is currently operating with 50 offices in 22 different states across America. They have aided about 32,000 families and have profited $63 million worth of loans. According to study, one half of those who engaged in the program had raised salaries and 94% were promoted in their work. More and more are repairing their credit status and becoming independent from the government.

The Mayor of D.C. Vincent Gray commended the program for giving the residents the help they need to access a better and more efficient life, not only for themselves but most especially for their families.

Consumer Financial Protection Bureau Retreats from Cards with High Fees

The consumer financial supervisor of the Obama administration would like to cancel a restriction on initial fees on credit cards, which brought about disapproval that it could be difficult for borrowers with bad credit.

The Consumer Financial Protection Bureau is retreating from limits on fee-harvester cards. The issuing bank of these cards charge borrowers a very high fee prior to receiving the cards with low credit lines.

The bureau said that its decision was a result of a court ruling. It said that the fee limit seems to be excluded by plain and ambiguous words in the related law. Prior to making the last decision, protests and criticisms can be filed until June 11.

Congress passed a credit card law which consists of a condition saying non-penalty fees should not be greater than 25 percent of the credit limit throughout the first year once the account is opened. This is applicable to fees every year and fees during application.

High fees were charged by First Premier Bank and Premier Bankcard as a provision of getting the cards.

Issuing banks offer fee-harvester cards so that borrowers with poor credit can make the credit scores higher. However, consumer groups believe that the cards are made to get overdraft and huge charges.

The two banks sued the Federal Reserve because of its ruling that the initial fees be taken in the fee cap during the first year. They allege that the Fed went beyond its power, which might damage to the banks.

The Consumer Financial Protection Bureau said that the policy change would bring about higher cost for cardholders and more profits for card issuers.

A staff attorney from Consumer Union, Lauren Bowne, said that the cards are supposed to help borrowers with poor credit or zero credit improve their credit scores. However, it has caused higher fees and penalties for the cardholders.

Banks Give Out Loans to Borrowers with Poor Credit Again

Jessica Silver-Greenberg and Tara Siegel Bernard, both from The New York Times, said that banks are beginning to improve again. As a result, lenders such as Capital One and GM Financial are trying to lend money to borrowers with poor credit. Not only are banks giving out loans, but also credit cards.

In addition, based on a report from Experian, Silver-Greenberg and Siegel Bernard said that 1.1 million worth of card were given to borrowers with poor credit last December and this was an increase of 12.3% from last year. These borrowers comprise 23% of car loans in Q4 of 2011, which increased from 17% in 2009.

According to The Times, investors picked up $11.7 billion last year in car loan securities, which increased from $12.7 billion in the year 2008. The Times was told by the GM’s risk manager that car lenders can handle the risk at the same time with lending money to those with bad credit.

The higher credit card lending is not encouraging as well. This is because credit card spending increased by 9.5 to 13 percent last year with credit cards like Visa, Mastercard, and American Express despite the fewer consumers who own those cards. Bloomberg’s Elizbeth Ordy said that credit and debit card holders use their cards more even though prepaid cards are becoming more popular.

Also, Ordy added that costumers’ credit card spending increased by 5.7% during the month of March compared to that of last year, as said by First Data Corp.

However, the figures are not that accurate. Moreover, Experian cannot separate the debts and spending into those made by borrowers with poor credit and those made by the borrowers who have lots of money.

It seems that this is all positive. Silver-Greenberg and Siegel Bernard emphasize that subprime lending indicates that the economy is recovering, that consumers have been paying loans, and that unpaid car loans and credit cards are not that many anymore.

How to Get Back Up Even After You’re Cleaned Out

Getting a loan is not as easy as ABC in today’s world. Lynn Richardson, expert in addressing financial problems, and the writer of the book Yes, You’re Approved: The Real Deal About Getting a Mortgage and Buying a Homeshares some secrets in getting the money you need.

You may think that bad credit, being bankrupt will hinder you from buying properties. You think these circumstances will make it impossible for you to rebuild your life and save enough money to start anew, with a clean slate. Well, according to the GlobalGrind coach, there are plenty of ways to get back on your feet. The thing you need to put in mind is that you need to have the right information. Here are some ways you can get a loan even after you are cleaned out.

Be honest.Write a letter about your situation, clarify every detail and do not lie about your current position. Explain clearly to the company or individual you are trying to borrow from how you got to the point of being bankrupt. If ever you lost your job, or you had an incident in the family, or you became incapable. After you state the reason why you lost your money, the next thing you should do is to relate the lessons you have learned from the experience. Finally, end the letter with what measures you plan to take in the future to make sure that the same thing will not happen again.

Do not procrastinate. Put in mind that you should never let your bills get any higher. Pay your liabilities on time. You should show the company that you will not be a problem, and that you will be a responsible money borrower. The delays will taint your records and this will not be very good for the company. If you receive mailed bills, tend to it immediately, do not wait for the due date to mind it. The earlier you pay it off and get rid of the bill; you are one step closer to your mortgage.

Do not start a credit card collection. One or two is enough. The lesser cards you have, the more you can control and monitor your spending. You should also take track of the due dates of each credit card and pay more than the minimal amount every month if possible. You should always remember to pay before the deadline because once you pay too late, you suffer from interest rates. And not only high interest rates, but your credit score will be affected too.

‘No More Student Loans for Non-members’ JPMorgan

Banks in the United States are taking tighter measures against lending to clients who are not members of the entity. This new regulation is going to be adopted by the JPMorgan Chase & Co., as they would cease to give student loans.

According to Steve O’Halloran, a spokesperson of the bank from New York, the loan given to private persons when it comes to education has decreased. He adds, that the government is stepping up and is providing the aid that students need.

JPMorgan will now demand Chase accounts from their clients. Furthermore, they could only apply for a loan or credit-card to get the financial aid. The bank will still go on in collecting and processing loans that they had given to student. They will also continue to negotiate with other entities that are engaged in giving financial aids to students.

According to the American Banker, the decision of JPM came after they were cutting off loses. Student loans composed about $1 trillion of the bank’s shops and $2.27 trillion was recorded in its trial balance.

The loans decreased 15% ($13.4 billion) in 2009 and the doubtful accounts of the company increased in a very alarming rate. The uncollectible account was at 72% since 2009, this is according to JPM itself. In 2012 the bank made lesser transactions with student loans, they cut the number to only $300 million from 2010 which was $1.9 billion.

Since July of 2010, private entities were no longer allowed to give loans to those who were given financial help by the government. The financial aid for students became the main reason for the nation’s debt.

The Consumer Financial Protection Bureau is now conducting an investigation on private financial entities. They are also receiving protests from clients about them. For now, the agency has identified the largest money lender to be Sallie Mae, which had given $36 billion for student loans.