Category: Banking

22
Sep

U.S. Bank Simple Loan vs Payday Loan

The CFPB has compared bank & credit union overdraft [NSF] fees to a short-term styled payday loan products with a 17,000% APR!”

According to Pew a bipartisan – in our opinion – “research association” –  12 million people a year take payday loans. If borrowers can’t make the payment, they often pay more fees to renew the loan. Payday borrowers, Pew found, spend an average of $520 in fees to repeatedly borrow $375.”

Yes, and a taxi costs $4800 from New York City to Los Angeles. BUT WHO WOULD DO THAT?

Here’s a letter from a consumer who wrote Consumer’s Union:

I am a single mother who works two jobs, is working on my masters and doesn’t receive child support. My family network is from Mexico, so we don’t have a lot of money. I am doing all of this on my own. My bank cashes the largest item first and deliberately causes my checking account to overdraft so they can charge me more in overdraft fees. The most recent situation was when my rent check was sent to be cashed a month after it was written. I had several small debit transactions out for less than $5. Had those debit transactions been paid first, I would have avoided all NSF fees as I most likely would have only been over by a few cents if anything. Instead, the bank cashed the check first and automatically imposed a NSF fee causing several other of the smaller debits to overdraw. So, now I am paying over $100 for being less than $20 over. All this does is keep me from being able to pay my other bills and put food on the table for my son. Without these fees, I would be able to save some money so I could avoid this from happening, but I can’t. It makes my stomach hurt knowing that I am simply being punished for being poor, when I desperately need help.

US BANK  Launches New Loan Product

“U.S. Bank’s new loans cost $12 for each $100 borrowed, when payments are automatically debited from a customer’s account. The fee is $15 per $100 if a customer opts out of automatic payments.”

Florida payday loans are currently $10 per $100 borrowed.

How to Start a Consumer Loan Business: Installment lending, car title loan lending, payday loan lending, personal loan business

Click This Image for Some Light Reading 🙂 Over Your Weekend!

California payday loan fees are $15 per $100 borrowed.

I could go on…

U.S. Bank Simple Loans are “between $100 and $1,000, are meant to help customers deal with unexpected expenses, like a car repair or a medical bill.”

Gee whiz! So are payday loans!

“U.S. Bank and several other institutions, including Wells Fargo and Regions Bank, for a time offered  “deposit advance loans,” which were costly and had to be repaid in a lump sum when the customer’s next paycheck was deposited. Banks abandoned the loans after regulators clamped down on them in 2013.”

Well sort of. Actually, banks and credit unions make MUCH MORE money via Non-Sufficient Funds Fees [NSF’s] then they ever could with these “deposit advance loans.” The DAL’s were simply for public consumption; PR. Nothing more.

“Overdraft fees are a real money-maker for banks. According to the Wall Street Journal, overdraft revenue is up 2.5% to $33 billion since 2015. Overall, in 2016, the top 10 biggest banks made $7.5 billion. These fees are costly for consumers. The Consumer Financial Protection Bureau (CFPB) has compared overdraft to a short-term loan with a 17,000% APR!”

U.S. Bank Simple Loan
Simple Loan FAQs

On a $400 loan, the fee would be $48, which equates to an annual interest rate of about 71 percent.

Where can I apply for a Simple Loan?
Log in to Online or Mobile Banking and access the Simple Loan application in your checking account dashboard.

How do I set up direct deposits to my checking account?
Download the U.S. Bank Direct Deposit Authorization Form (PDF).
Provide your U.S. Bank deposit account type (checking or savings), account number and routing number, and other required information.
Submit the completed direct deposit form.

When is the first payment due on my Simple Loan?
Your first payment will be due at least 30 days after the date you complete your loan. The next two monthly payments will be due on the same date each month.

Note: Your first payment due date will not fall on the 29th, 30th or 31st.

How do I make payments?
If you choose automatic payments, the minimum due on your Simple Loan will be automatically deducted from your checking account on the day it is due.

To make manual payments you can visit a branch, call us at 800.872.2657, mail a check to the address on your statement, or log in to Online and Mobile Banking and transfer money from a U.S. Bank account or an account you hold at another financial institution.

Can I pay off my Simple Loan early?
You can pay down your loan faster by paying more than the minimum due, but doing so will not reduce the total amount or fees that you owe. There is no pre-payment penalty for paying the loan off early.

Will I incur any fees if I miss a payment or make a late payment?
There are no missed payment fees, non-sufficient funds fees, or late payment fees on a Simple Loan.

When will the money be deposited into my checking account?
After your loan is approved and booked, you can access funds immediately. Please note: funds deposited to your account after 8 p.m. CT will be available for withdrawal, but will not post to your account until the next business day.

What if I need less than $100?
Simple Loan has a minimum of $100 and maximum of $1,000. For an amount less than $100 a Reserve Line or credit card may be right for you.

When can I apply for another Simple Loan?
You can apply for another Simple Loan after 30 days has passed since you’ve paid off your previous Simple Loan.

Are alternative, small dollar lenders concerned about the banks? NOPE!

Payday loan, car title loan, installment loan, line-of-credit lenders… JUST WANT A LEVEL PLAYING FIELD.

Banks must enable any legal business to have a bank account.

Banks & Credit Unions must disclose fees CLEARLY.

Credit Unions should pay taxes.

Then, bring on the competition. Allow consumers to choose the loan product that meets their needs.

Banks & Credit Unions are big, fat and slow. Are you a lender? Don’t worry about competition from these behemoths! Have you been into one lately?

You want into the “business of lending money to the masses?” Get started here: Click to Launch a Consumer Loan Business!

How to Start a Consumer Loan Business: Installment Loans, Car Title Loans, Payday Loans, Consumer Loans

How to Start a Consumer Loan Business

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19
Jan

CFPB Drops Suit against 4 Payday Loan Tribes

The CFPB continues to capitulate in the payday loan space!

President Trump and acting director Mick Mulvaney have had an astoundingly positive influence on the outlook for payday lending and the upbeat environment for US households as well.

Previously, the CFPB received an astounding 1,000,000,000+ comments from US consumers “praying” for continued access to payday loans and other small dollar loan products.

These consumer comments in the form of electronic and hand written communications fell on deaf ears at the CFPB.

The CFPB ignored them. Additionally, the CFPB ignored the payday loan industry, their employees, vendors and pro-payday loan legislators throughout the USA – of whom there are many.

This continued attack of a lawful industry became further weakened today by the announcement that the CFPB is dropping all lawsuits against 4 payday loan tribal lenders!

The lenders are: GOLDEN VALLEY LENDING, INC., SILVER CLOUD FINANCIAL, INC., MOUNTAIN SUMMIT FINANCIAL, INC., AND MAJESTIC LAKE FINANCIAL, INC.

The reason the CFPB threw in the towel? They want to ” consult with new leadership” at the CFPB  🙂

Before Hon. Julie A. Robinson, the FED’s filed a “Notice of Voluntary Dismissal” against the four lenders owned and operated by the Habematolel Pomo of Upper Lake.

NO REASONS WERE GIVEN!

[Sponsor: Need a bank account for your MSB or lending business? Want to “push” loan funds to a consumer’s phone? Need ACH, credit card or debit card process? Need a second “backup” enabling your Team to sleep at night? Get an introduction here: Click “PROCESSING.”

Recall that last October, under the lead of former Director Richard Cordray, the CFPB had intended to implement new rules requiring all lenders to make a determination as to the borrower’s ability to repay the loan.

This would have caused massive disruption; after all, the typical payday loan is less than $400! How on earth coild a lender be expected to analyize ther loan applicant’s personal income, household and expense situation? Most of these folks are simply caught in a temporary financial emergency; utilities turned off, car repair, prescription needed…

For many LONG months, the payday and car title loan industry has been expecting overly aggressive CFPB rules to be implemented.

Today? These expectations are at an end! President Trump’s administration has delivered a HUGE dose of common sense to “the business of lending money to the masses.”

[As a result, our inbound phone calls and emails for consulting, capital raises, bank accounts, credit and debit card processing and “$$ push to borrowers” is escalating dramatically! TrihouseConsulting@gmail.com]

These are proving to be VERY GOOD TIMES for US households and lenders! It’s been such a LONG time that we’ve had a sense of optimism and entrepreneurship in America.

FEELS GREAT!!

Here’s the announcement from the CFPB regarding the 4 tribes:

notice-of-voluntary-dismissal-c-4-Tribes-01-19-2018

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20
Dec

Bank Accounts for MSB’s, PDL, Check Cashers: “Bank Discontinuance Solved.”

A seriously experienced provider [20+ years in the industry] for MSB bank accounts, money transmitters, check cashers, ACH services, Pin Debit & EBT, ATM services… reached out to me today for introductions to our industry.

If you’ve ever received a 30 day “Bank Discontinuance Notice” from your bank you’ll recall that sick feeling in your gut! And if you really think “Operation Choke Point” is a thing of the past, I have a bridge for you to invest in; it’s a crypto digital bridge so you know it will 1000X in the next day or two  🙂

It’s likely you need a back-up Bank! Read on…

Here’s the nitty-gritty on this “Solution:”

For all MSB’s, Online Money Transmitters, Store Front Check Cashers, Storefront Money Transmitters…

  • Banking
  • RDC
  • Cash Services- Vaulting, Cash delivery, cash pickup
  • ACH
  • PIN debit and EBT
  • PINless debit
  • Credit card
  • ATM services
  • We provide services to large and small MSB’s in every state.

“We have a unique approach to the MSB market. In a typical Agent Model, the Agent controls the bank account(s) and remits to the Licensed MSB. We do the opposite. All depository accounts are in the Licensed MSB’s name and controlled by the Licensed MSB. The Licensed MSB simply pays the Agent their commissions. Our solution eliminates collections, improves cash flow and facilitates execution. For the Agents, this reduces their oversight and costs associated with the services provided by the licensed MSB.”

“Our solution mitigates the continuing assault and increasing regulatory pressure put on our industry daily by state and federal agencies by providing a level of compliance our industry has not experienced until today.”

“Improved MSB profitability: We have merchant processing solutions that eliminates fees for the merchant and passes them on to your customer.”

“Our solution magnifies the capabilities of storefronts by providing PINless debit and EBT. This enables your MSB to perform ATM type transactions at the cashier and add multiple methods for transactions.”

“We use state chartered banks who’s infrastructure is more compatible with MSB’s regulatory requirements.”

We have:

  • 2 banks that service all 50 States
  • 3 ACH providers
  • 3 PIN debit providers
  • 3 PINless debit providers
  • 2 Credit Card processing solutions

“We can set up concentration as well as settlement accounts, operating accounts, and depository accounts  for you, our valued client.”

“We API integrate to virtually any platform or POS.”

FOR A PRIVATE, DISCREET INTRODUCTION, GO HERE: “Click for Private Intro.” or Form Below.

Here’s a few Success Stories and Testimonials: 

700 location MSB with online money transmitter program.

We were able to secure Pin debit and EBT for the storefronts. This MSB did not previously have merchant processing at their locations prior to partnering up with our Team and our solution. They did have processing for their online money transmission program. We cut their costs by 40%. “XXX Inc. [redacted by Jer] is an experienced team that really understands the challenges we face as MSB’s. They not only secured payment processing for our online solution, but they cut our costs considerably. I searched for months for an affordable solution. Not only did I experience reduced costs but additionally I was able to add additional processing services to my store fronts where I did not have processing in the past.”

POS Provider:

“We are now a preferred vendor for certain POS systems used in the MSB space. We provide banking and processing to anyone they refer to us. XXX Inc. [redacted by Jer] is a single point of contact that supplies bank account and processing. XXX Inc. [redacted by Jer] are knowledgeable and efficient. I did not have to go back and forth with them to negotiate pricing. I got a great deal. They deserve rave reviews.”

MSB Agent program:

A 3200 location convenient store consortium. XXX Inc. [redacted by Jer] sets up bank accounts and  merchant processing for my convenient stores who are licensed MSB’s. We are in 32 states. XXX Inc. [redacted by Jer] provides a complete suite of services including Cash Pickup, Cash Delivery and Vaulting. We would recommend them to anyone for their banking solutions. This is traditional banking services and the banks are motivated to expand their MSB footprint.”

FOR A PRIVATE, DISCREET INTRODUCTION

Provide your contact info: online form.

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07
Jul

Payday Loans vs Bank NSF and Overdraft Fees: Reported by CFPB

You think payday loan, installment loan and car title loan APR’s are high?

You want to know why banks, credit unions and so-called consumer advocates hate small dollar lenders?

Did you know the folks who initially funded the Center for Responsible Lending [CRL] launched a credit union – an entity treated as a non-profit?

Follow the money…

Payday Loan, Installment Loan, Title Loan APR's vs Banks

Payday Loan, Installment Loan, Title Loan APR’s vs Banks

Check this out! The USA’s 628 biggest banks reported – after being forced to by the FFIEC – $11.2 BILLION dollars in NSF and overdraft fees in 2015. [2015 is the first year banks having assets exceeding $1B were required to report this number!]

$11.2 BILLION is 8% of these bank’s net income.

The median bank fee was $34.00. However, because of the way bank algorithms work, 25% of bank customers paid $90 per instance [2013].

Average payday loan APR? Just under 400%

The average bank NSF fee? 1400%

Now, realize that these banks have virtually ZERO RISK! They are at the front of the line. Their account holder; their customer – must pay the bank/credit union or they put their customer in the ChexSystem data base and close their customer’s bank account.

And, let’s not forget that the banks borrow their money from the FED’s for approximately 1%. THIS IS NUTS!

[Note: If you would like a copy of the original CFPB Report in PDF format, email: Jer@PaydayLoanUniversity.com ]

60 of the reporting banks derived 20% of their net revenue from overdraft and NSF fees!

  • So… installment, car title and payday lenders must raise capital at average rates of 1.5% to 3%+ per month; typically with personal guarantees.
  • Assume the risks associated with launching a new business.
  • Overcome the challenges the search engines place on them.
  • Face the continued negative pummeling brought down on them by their competition: banks and non-profit credit unions.
  • Approve loans for consumers with zero collateral.
  • Face-off the FED’s regarding Operation Choke Point – we did get a nice victory on this matter recently 🙂
  • Keep their loan portfolios on their books [balance sheet lending] vs securitization by the big boys.
  • And a host of additional B.S. that comes with the territory.
  • Banks and credit unions HATE US because we are cheaper!!

Now mind you, we are not whining! Just asking for a level playing field – never going to happen – AND the realization by all parties that payday loan, car title and installment loans make a GREAT DEAL of sense for millions of consumers EVERY YEAR!

 

 

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10
Jun

Payday Loan Operation Choke Point-Update

Operation Choke Point Lawsuit Update via Judge in District of Columbia.

Judge Kessler in the District of Columbia, denied a group of payday lenders allegedly affected by the Department of Justice’s (DOJ) controversial Operation Choke Point.

Banks for payday loan lenders.

Payday loan industry fails to demonstrate harm due to an inability to secure bank relationships.

“For example, the payday lender told the court that it received termination notices from 21 banks since 2013. But the company did not indicate how many banks it continues to have accounts or business relationships with leaving the court unable to conclude that they have been “cut off” from the system. ‘In sum, the fairest reading of Plaintiffs’ submissions is that, presently, they do have a right to hold bank accounts and otherwise access the banking system,’ the court wrote.”

Car title loan company

Start a PDL Business

The CFSA and additional payday loan plaintiffs requested the U.S. Court of Appeals for the D.C. Circuit to review their case.

Here’s a link to the “Opinion.”

Here’s a link to the original discussion appearing in JD Supra.

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