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Leveraged Loan Funds See 14th Outflow In Last 16 Weeks; Year-To-Date Sum Falls Into The Red

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Cash outflows from bank loan funds totaled $406 million for the week ended July 30, according to Lipper. The outflow is on spot with $413 million last week, and once again, there was essentially no influence on the ETF front.

There have now been 14 weeks of outflows over the past 16 weeks, for a combined negative $7 billion over that span, which follows a record-shattering 95-week inflow streak totaling $66.7 billion.

The trailing four-week average also held relatively steady, at negative $302 million per week on average, from negative $315 million last week. However, this measure remains much narrower than a peak at $858 million in the week ended June 11.

Year-to-date flows turn into negative territory, at $54 million, based on a net withdrawal of $815 million from mutual funds set against a net inflow of $761 million to ETFs. In the comparable year-ago period, inflows were $33.4 billion, with 12% tied to ETFs.

The change due to market conditions was negative $145 million this week compared to total assets of $107.3 billion at the end of the observation period, so the change is essentially nil. The ETF segment comprises $8.2 billion of the total, or approximately 8%.

Matt Fuller

Follow Matthew on Twitter @mfuller2009 for leveraged debt deal-flow, fund-flow, trading news, and more.

[…]

Fitch Rates Nelnet Student Loan Trust 2014-6

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings assigns ratings to Nelnet Student Loan Trust (NSLT) 2014-6 student loan asset-backed notes as follows:

–$565,000,000 class A notes ‘AAAsf’; Outlook Stable;

–$8,300,000 class B notes ‘A+sf’; Outlook Stable.

KEY RATING DRIVERS

High Collateral Quality: The trust collateral consists of 100% Federal Family Education Loan Program (FFELP) loans including approximately 65% rehabilitated (rehab) loans. In Fitch’s opinion, the credit quality of the trust collateral is high, based on the guarantees provided by the transaction’s eligible guarantors and at least 97% reinsurance of principal and accrued interest provided by the U.S. Department of Education (ED). The U.S. is currently rated ‘AAA’, Outlook Stable.

Sufficient Credit Enhancement: Cash flow scenarios for class A and B notes were satisfactory under Fitch’s respective stresses. Total credit enhancement (CE) is provided by overcollateralization (OC) and excess spread, and for the class A notes, 1.45% subordination is provided by the class B notes. At closing, total and senior parity are expected to be 101.79% and 103.29%, respectively. A target OC amount equal to the greater of 2.27% of the adjusted pool balance and $2 million must be met before excess spread can be released from the trust.

Adequate Liquidity Support: Liquidity support is provided by an approximate $12.9 million reserve account (2.25% of outstanding note balance), funded at closing with note proceeds. On or after the January 2016 distribution date, the specified reserve requirement will be the greater of 0.25% of the outstanding note balance and 0.10% of the initial note balance.

Acceptable Servicing Capabilities: Nelnet, Inc. will service approximately 36.28% of the NSLT 2014-6 portfolio. Xerox Education Services LLC (Xerox-ES), Great Lakes Educational Loan Services Inc. (GLELSI) and Pennsylvania Higher Education Assistance Agency (PHEAA) will service 47.22%, 9.07% and 7.44%, respectively, of the remaining portfolio. In Fitch’s opinion, all servicers are acceptable servicers of FFELP student loans.

RATING SENSITIVITIES

Since FFELP student loan ABS rely on the U.S. government to reimburse defaults, ‘AAAsf’ FFELP ABS ratings will likely move in tandem with the ‘AAA’ U.S. sovereign rating. Aside from the U.S. sovereign rating, defaults and basis risk account for the majority of the risk embedded in FFELP student loan transactions. Additional defaults and basis shock beyond Fitch’s published stresses could result in future downgrades. Likewise, a buildup of credit enhancement driven by positive excess spread given favorable basis factor conditions could lead to future upgrades. For further discussion of Fitch’s sensitivity analysis, please see the presale titled ‘NSLT 2014-6’, dated July 28, 2014, available at www.fitchratings.com.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Global Structured Finance Rating Criteria’ (May 20, 2014);

–‘Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria’ (June 23, 2014);

–‘Representations, Warranties and Enforcement Mechanism in Global Structure Finance Transactions’ (April 17, 2012).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748821

Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=750530

Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=676496

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=843304

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch RatingsFFELP Contact:

Fitch Ratings

Primary Analyst

Nicole Edwards, +1-212-908-9114

Director

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 10004

or

Secondary Analyst

Victoria Ohorodnyk, +1-212-908-0866

Associate Director

or

Committee Chairperson

Tracy Wan, +1-212-908-9171

Senior Director

or

Media Relations

Sandro Scenga, New York, +1-212-908-0278

sandro.scenga@fitchratings.com […]

Fitch Affirms Nelnet Student Loan Trust Series 2009-3

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings affirms the notes issued by Nelnet Student Loan Trust Series 2009-3 at ‘AAAsf’. The Rating Outlook remains Stable.

KEY RATING DRIVERS

High Collateral Quality: The trusts’ collateral consists of 100% Federal Family Education Loan Program (FFELP) loans. The credit quality of the trusts’ collateral is high, in Fitch’s opinion, based on the guarantees provided by the transaction’s eligible guarantors and reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch currently rates the U.S. ‘AAA’ with a Stable Outlook.

Sufficient Credit Enhancement: Credit enhancement (CE) for both trusts is provided by overcollateralization (OC; the excess of trust’s asset balance over bond balance) and excess spread. The total reported parity for the trust is 113.25%. The Trust is a turbo structure and excess cash cannot be released until all of the notes are paid in full.

Adequate Liquidity Support: Liquidity support is provided by a debt service reserve fund sized at the greater of 0.25% of the pool balance and $429,301.

Acceptable Servicing Capabilities: Nelnet, Inc. is responsible for the day-to-day servicing of the loans in the trusts. In Fitch’s opinion, they are an acceptable servicer of FFELP student loans.

RATING SENSITIVITIES

Since FFELP student loan ABS rely on the U.S. government to reimburse defaults, ‘AAAsf’ FFELP ABS ratings will likely move in tandem with the ‘AAA’ U.S. sovereign rating. Aside from the U.S. sovereign rating, defaults and basis risk account for the majority of the risk embedded in FFELP student loan transactions. Additional defaults and basis shock beyond Fitch’s published stresses could result in future downgrades. Likewise, a buildup of credit enhancement driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

Fitch has affirmed the following:

Nelnet Student Loan Trust Series 2009-3:

–Class A at ‘AAAsf’; Outlook Stable.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Global Structured Finance Rating Criteria’ (May 20, 2014);

–‘Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria’ (June 23, 2014).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748821

Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=750530

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=843300

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch RatingsFFELP Contact:

Fitch Ratings

Primary Analyst

Jared Smith, +1-212-908-0371

Analyst

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 10004

or

Committee Chairperson

Tracy Wan, +1-212-908-9171

Senior Director

or

Media Relations

Sandro Scenga, New York, +1-212-908-0278

sandro.scenga@fitchratings.com […]

Osum Oil Sands Corp. Acquires Orion Oil Sands Project and Closes Senior Secured Credit Facilities

CALGARY, ALBERTA–(Marketwired – Jul 31, 2014) – Osum Oil Sands Corp. (“Osum” or the “Company”), a private in-situ oil sands company, today announced that its wholly-owned subsidiary, Osum Production Corp. (“OPC”), has completed the purchase of the Orion Oil Sands Project from Shell Canada (a Royal Dutch Shell Group entity) for Canadian $325 million.

Commenting on the success of the acquisition, Steve Spence, President and Chief Executive Officer, said: “The acquisition of the Orion project provides Osum with significant current production and cash flow. As well, we are pleased to welcome the high quality, experienced operating team members joining our organization today. We believe Osum has a unique opportunity to build a significant production platform from both Orion and our neighboring Taiga project in the Cold Lake region.”

The acquisition was funded from cash on hand and with the net proceeds of a new US$210 million Senior Secured Term Loan Facility to OPC (the “Term Loan Facility”). The Term Loan Facility has a maturity date of July 31, 2020 and an interest rate of LIBOR plus 5.50% with a 1.00% LIBOR floor. In addition, OPC has access to a US$15 million Senior Secured Revolving Loan Facility for general corporate purposes (the “Revolving Loan Facility”). Barclays Bank PLC and Goldman Sachs Lending Partners LLC acted as Joint Lead Arrangers and Joint Bookrunners for each of the Term Loan Facility and the Revolving Loan Facility.

Acquisition Highlights:

The Orion Project is located in the Cold Lake oil sands region, in close proximity to numerous major oil sands developments. It is approximately 18 kilometers SW of Osum’s Taiga Project, which has received regulatory approval for the construction and operation of a 35,000 barrel per day facility. The Project has been producing commercially since 2007 using the well-established Steam Assisted Gravity Drainage (SAGD) thermal heavy oil recovery technology. Second quarter production averaged approximately 6,800 barrels per day of bitumen from 22 well pairs. At forecast production rates, the Project is expected to have an economic life in excess of 25 years. Osum has 100% working interest and operatorship of the project.

CIBC World Markets Inc., Barclays Capital Canada Inc., and Goldman Sachs Canada Inc. acted as financial advisors to Osum in respect of the acquisition.

About Osum

Established in Alberta in 2005, Osum Oil Sands Corp. is a private oil sands producer focused on the responsible application of in-situ recovery technologies within Canada’s oil sands and carbonates. Additional information on the Company is available at www.osumcorp.com.

Cautionary Information and Forward Looking Statements

Certain statements contained in this press release may contain projections and “forward-looking statements” within the meaning of that phrase under Canadian and U.S. securities laws. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions may be used to identify forward-looking statements. Those statements reflect management’s current views with respect to future events or conditions, including expected cash flows, expected production levels, and expected economic life of the Orion Oil Sands Project, retaining a high quality, experienced operating team, financial position, predictions of future actions or plans or strategies.

Certain material factors and assumptions were applied in drawing conclusions and making forward-looking statements. By their nature, those statements reflect management’s current views, beliefs and assumptions and are subject to certain risks, uncertainties, known and unknown, and assumptions, including, without limitation, assumptions about expected cash flows, expected production levels, and expected economic life of the Orion Oil Sands Project, retaining a high quality, experienced management team, production delays, changing environmental and other regulations, the ability to attract and retain business partners, the ability to exploit hydrocarbon resources with available technology, the need to obtain and maintain proprietary rights over aspects of the technology, competition from other technologies, the ability to access the capital required for project development, research, technology development, operations and marketing, changes in energy prices and currency levels.

Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the projections or forward-looking statements prove incorrect, actual results may vary materially from those described in this press release as intended, planned, anticipated, believed, estimated, or expected. Osum does not intend and does not assume any obligation to update these forward-looking statements whether as a result of new information, plans, events or otherwise.

The Company’s securities are not traded on any stock exchange and thus, Osum is not subject to regulation by any Canadian stock exchange. Osum is not a reporting issuer in Canada and its securities are not registered under the United States Securities Act of 1933. As a result, the Company is not presently subject to the reporting, certification or other requirements imposed on Canadian Reporting Issuers or U.S. registered issuers under, among other things, applicable Canadian securities legislation or the U.S. Sarbanes-Oxley Act of 2002 (“SOX”).

This release is provided for information purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the common shares in any jurisdiction (including the United States) in which such offer, solicitation or sale would be unlawful.

FinanceInvestment & Company Information Contact:

Osum Oil Sands Corp.

Justin Robinson

Manager, Communications

jrobinson@osumcorp.com […]

What Do Payday Loans Cost Caps Really Mean For Borrowers …

Image payday-loans-300x200.jpg

The following article is from Mary Butland. She is a finance blogger and freelance writer who produces articles for some of the UK’s most authoritative sites. When she’s not hammering away at her keyboard, Mary is a keen balloon artist and amateur baker.

Good news at last. I’m sure by now the majority of you will have heard that the Financial Conduct Authority (FCA), the payday loans industry regulator, has proposed cost caps that, if accepted, will limit the cost of a payday loan.

Following their announcement in July 2014, the proposals are now in the consultation period, before coming into force on 2 January 2015. The details of the caps are threefold. Firstly, they limit the interest and fees on new payday loans, and loans rolled over, to just 0.8 percent of the amount borrowed. Then there’s late payment fees, which cannot exceed £15. Finally, the total amount of fees and interest an individual will have to repay will never exceed the original value of the loan. In practice, this means that a £100 loan from a payday lender like Wonga will never cost more than £200 to repay.

These are not the only recent developments in the payday loans sector. New rules which came into force on the 1 July this year prevented payday lenders from rolling over loans more than twice and restricted their ability to use continuous payment authority to take money directly from customers’ accounts. Alongside the cost caps, this may sound like the answer to the problems some people have experienced with payday loans, but unfortunately, it might not be that simple.

The potential problems with cost caps

On the face of it, cheaper payday loans can only be good news for borrowers. Debt spirals will be a thing of the past and consumers will understand precisely how much a loan could cost them before they agree to the loan. The caps may not be such good news for lenders, who it is estimated will lose 42 percent of their £1 billion revenue a year, but the major players in the industry should still be able to operate at a profit.

However, the implications of cost caps run more deeply for those most in need of short-term credit. The real problems will be experienced by those who have been turned down for loans from other lenders due to their poor credit records. While the payday lenders could take on risky loans in the past thanks to more generous profit margins, they may now have to turn down loans from those most in need. This will leave the most vulnerable in our society with nowhere to turn other than criminal loan sharks.

The popularity of payday loans

In the last year alone, 1.6 million consumers have taken out payday loans worth a total of £2.5 billion, with each customer receiving an average of six payday loans over the course of a year. The average loan amount was £260, borrowed over an initial period of 30 days.

Once the new price caps are in place, the Financial Conduct Authority estimates borrowers will save an average of £193 over the course of the year. This will result in total annual savings of £250 million and will represent £420 million in lost revenues for the lenders.

Unfortunately however, it is these lost revenues which may force lenders to reject borrowers who present a risky lending proposition. Currently, there is no viable or legal lending alternative to handle this overspill. As not-for-profit organizations, credit unions charge an average APR of 3 percent. This gives them little leeway to lend to those who may default on their loan, resulting in more conservative lending decisions than those made by the payday lenders.

A spokesperson for the comparison and switching service uSwitch, said: “Payday lenders have an important role to play in providing short-term credit and our research shows that over half of all customers who have taken out a payday loans say the experience was positive.

“However, it is important that the issues around the lack of adequate credit checking and providing support to those who end up in financial difficulties are addressed.”

The Consumer Finance Association which represents the payday lenders, said: “With new regulations and tighter affordability checks, critics must now face up to the fact that more people use, need and like short-term credit and the measures in place are more stringent than for any other form of consumer credit.”

Do you agree that the proposed cost caps will make payday loans a highly affordable source of short-term credit? On balance do you think the cost caps are good or bad for consumers? Please leave your thoughts in the comments section below.

[…]

RAIT Financial Trust Announces Second Quarter 2014 Financial Results

PHILADELPHIA–(BUSINESS WIRE)–

RAIT Financial Trust (“RAIT”) (RAS) today announced second quarter 2014 financial results.

Financial Performance

Cash Available for Distribution (“CAD”) per share increased 41.2% to $0.24 for the quarter ended June 30, 2014 from $0.17 for the quarter ended June 30, 2013. Total revenues grew 25.1% to $73.3 million for the quarter ended June 30, 2014 from $58.6 million for the quarter ended June 30, 2013.

Dividends

On June 12, 2014, RAIT declared a second quarter 2014 common dividend of $0.18 per share, representing a 38% increase from the second quarter 2013 common dividend of $0.13 per common share. The second quarter common dividend record date was July 11, 2014 and was paid on July 31, 2014.

CRE Loan Portfolio

Investments in mortgages and loans increased 17.9% to $1.32 billion at June 30, 2014 from $1.12 billion at December 31, 2013. RAIT originated $246.3 million of loans during the quarter ended June 30, 2014 consisting of $112.8 million bridge loans, $119.7 million conduit loans and $13.8 million mezzanine loans. RAIT originated $470.8 million of loans for the six-month period ended June 30, 2014. RAIT sold $46.9 million of conduit loans during the quarter ended June 30, 2014 which generated $2.8 million of fee income.

CRE Property Portfolio

Based upon properties owned as of June 30, 2014, average effective rent per unit per month in RAIT’s multifamily portfolio increased 7.5% to $799 for the quarter ended June 30, 2014 from $743 for the quarter ended June 30, 2013. As of June 30, 2014, RAIT’s investments in real estate increased 30% to $1.3 billion from $1.0 billion at December 31, 2013. Rental income increased 41% to $39.2 million during the quarter ended June 30, 2014 from $27.9 million for the quarter ended June 30, 2013 driven largely by the acquisition of 16 properties subsequent to June 30, 2013 which generated $10.6 million of rental income during the quarter ended June 30, 2014.

Assets Under Management

Assets under management increased 47% to $5.3 billion at June 30, 2014 from $3.6 billion at December 31, 2013 due primarily to inclusion of third party retail properties managed by RAIT’s retail-focused property manager beginning in 2014.

Scott Schaeffer, RAIT’s Chairman and CEO, said, “We continue executing on our strategy of raising capital and investing it into our multi-strategy commercial real estate business. During the second quarter gross loan originations increased 44% to $246.3 million when compared to the second quarter of 2013. Our property portfolio grew through acquisitions and increasing rents which led to a 41% increase in rental income and a 51% increase in net operating income since June 30, 2013. The second quarter common dividend, which has increased 38% since the second quarter of 2013, represents a 75% payout ratio on our second quarter CAD per share.”

Financial Results

RAIT reported CAD, a non-GAAP financial measure, for the three-month period ended June 30, 2014 of $19.7 million, or $0.24 per share – diluted based on 81.8 million weighted-average shares outstanding – diluted, as compared to CAD for the three-month period ended June 30, 2013 of $11.9 million, or $0.17 per share – diluted based on 69.8 million weighted-average shares outstanding – diluted. RAIT reported a net loss allocable to common shares for the three-month period ended June 30, 2014 of $25.7 million, or $0.31 total loss per share – diluted based on 81.8 million weighted-average shares outstanding – diluted, as compared to net loss allocable to common shares for the three-month period ended June 30, 2013 of $65.9 million, or $0.94 total loss per share – diluted based on 69.8 million weighted-average shares outstanding – diluted. The second quarter 2014 net loss includes $25.1 million of unrealized losses relating primarily to non-cash mark-to-market adjustments in RAIT’s legacy Taberna portfolios and the associated hedges. Non-cash mark-to-market gains and losses are excluded from CAD.

RAIT reported CAD for the six-month period ended June 30, 2014 of $37.0 million, or $0.46 per share – diluted based on 80.6 million weighted-average shares outstanding – diluted, as compared to CAD for the six-month period ended June 30, 2013 of $22.8 million, or $0.35 per share – diluted based on 65.1 million weighted-average shares outstanding – diluted. RAIT reported a net loss allocable to common shares for the six-month period ended June 30, 2014 of $40.2 million, or $0.50 total loss per share – diluted based on 80.6 million weighted-average shares outstanding – diluted, as compared to net loss allocable to common shares for the six-month period ended June 30, 2013 of $156.4 million, or $2.40 total loss per share – diluted based on 65.1 million weighted-average shares outstanding – diluted. The six-month period ended June 30, 2014 net loss includes $49.2 million of unrealized losses relating primarily to non-cash mark-to-market adjustments in RAIT’s legacy Taberna portfolios and the associated hedges. Non-cash mark-to-market gains and losses are excluded from CAD.

A reconciliation of RAIT’s reported net income (loss) allocable to common shares to its CAD is included as Schedule I to this release. A reconciliation of RAIT’s total shareholders’ equity to its adjusted book value, a non-GAAP financial measure, is included as Schedule II to this release. A reconciliation of RAIT’s net income (loss) allocable to common shares to its funds from operations (“FFO)”, a non-GAAP financial measure, and adjusted funds from operations (“AFFO”), a non-GAAP financial measure, is included as Schedule III to this release. These Schedules also include management’s respective rationales for the usefulness of each of these non-GAAP financial measures.

Key Statistics
(Unaudited and dollars in thousands, except per share information)

As of or For the Three-Month Periods Ended

June 30,
2014

March 31,
2014

December
31, 2013

September
30, 2013

June 30,
2013

Financial Statistics: Total revenue $73,256 $67,308 $67,607 $62,395 $58,622 Earnings (loss) per share – diluted $(0.31) $(0.18) $(1.90) $(0.24) $(0.94) CAD per share, diluted $0.24 $0.22 $0.27 $0.23 $0.17 Common dividend declared per share $0.18 $0.17 $0.16 $0.15 $0.13 Assets under management $5,266,296 $5,119,805 $3,595,530 $3,567,675 $3,616,009 FFO per share, diluted $(0.20) $(0.07) $(1.74) $(0.12) $(0.81)

Commercial Real Estate (“CRE”) Loan Portfolio:

CRE loans– unpaid principal $1,325,748 $1,228,452 $1,115,949 $1,103,272 $1,154,306 Non-accrual loans — unpaid principal $30,269 $28,019 $37,073 $45,337 $65,597 Non-accrual loans as a % of reported loans 2.3% 2.3% 3.3% 4.1% 5.7% Reserve for losses $15,336 $14,279 $22,955 $23,317 $24,222 Reserves as a % of non-accrual loans 50.7% 51.0% 61.9% 51.4% 36.9% Provision for losses $1,000 $1,000 $1,500 $500 $500 CRE Property Portfolio: Reported investments in real estate(1) $1,268,769 $1,205,995 $1,004,186 $986,296 $949,649 Net operating income(1) $19,524 $17,093 $13,919 $13,712 $12,947 Number of properties owned(1) 74 71 62 61 60 Multifamily units owned(1) 12,388 12,014 9,372 8,940 8,535 Office square feet owned 2,248,321 2,097,022 2,009,852 2,015,524 2,015,576 Retail square feet owned 1,420,909 1,420,909 1,421,059 1,421,059 1,421,059 Land (acres owned) 21.92 21.92 21.92 21.92 21.92 Average occupancy data: Multifamily(1) 92.8% 93.3% 92.2% 92.5% 92.6% Office 74.3% 74.8% 75.6% 74.1% 74.3% Retail 67.5% 66.6% 69.0% 68.9% 68.7% Average Effective Rent per Unit/Square Foot (2): Multifamily (1)(3) $799 $767 $763 $761 $743 Office (4) $20.10 $18.70 $18.40 $19.45 $18.77 Retail (4) $12.50 $12.44 $12.11 $12.05 $11.78 (1) Includes 19 apartment properties owned by RAIT’s consolidated subsidiary, Independence Realty Trust, Inc. (“IRT”) (NYSE MKT: IRT), with 5,342 units and a book value of $343.5 million as of June 30, 2014. At July 30, 2014, RAIT owned 28% of IRT’s outstanding common stock. (2) Based on properties owned as of June 30, 2014. (3) Average effective rent is rent per unit per month. (4) Average effective rent is rent per square foot per year.

Conference Call

All interested parties can listen to the live conference call webcast at 9:00 AM ET on Thursday, July 31, 2014 from the home page of the RAIT Financial Trust website at www.rait.com or by dialing 800.299.9086, access code 20320568. For those who are not available to listen to the live call, the replay will be available shortly following the live call on RAIT’s website and telephonically until Thursday, August 7, 2014, by dialing 888.286.8010, access code 35898971.

About RAIT Financial Trust

RAIT Financial Trust is an internally-managed real estate investment trust that provides debt financing options to owners of commercial real estate and invests directly into commercial real estate properties located throughout the United States. In addition, RAIT is an asset and property manager of real estate-related assets. For more information, please visit www.rait.com or call Investor Relations at 215.243.9000.

Forward-Looking Statements

This press release may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as “may,” “trend”, “will,” “continue,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “look forward” or other similar words or terms. Because such statements include risks, uncertainties and contingencies, actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. These risks, uncertainties and contingencies include, but are not limited to, those disclosed in RAIT’s filings with the Securities and Exchange Commission. RAIT undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law.

RAIT Financial Trust
Consolidated Statements of Operations
(Dollars in thousands, except share and per share information)
(unaudited)

For the Three-Month
Periods Ended
June 30,

For the Six-Month
Periods Ended
June 30,

Revenues: 2014 2013 2014 2013 Net interest margin: Investment Interest income $ 34,646 $ 31,256 $ 69,609 $ 62,536 Investment Interest expense (7,523 ) (7,278 ) (14,706 ) (14,761 ) Net interest margin 27,123 23,978 54,903 47,775 Rental income 39,214 27,858 74,390 55,027 Fee and other income 6,919 6,786 11,271 14,071 Total revenue 73,256 58,622 140,564 116,873 Expenses: Interest expense 13,241 9,978 24,846 19,644 Real estate operating expense 19,690 14,911 37,773 29,321 Compensation expense 7,376 6,337 15,931 13,284 General and administrative expense 4,874 3,562 9,075 7,338 Provision for losses 1,000 500 2,000 1,000 Depreciation and amortization expense 13,441 8,618 25,483 17,188 Total expenses 59,622 43,906 115,108 87,775 Operating income 13,634 14,716 25,456 29,098 Other income (expense) 5 69 15 145 Gains (losses) on assets (7,599 ) 224 (5,375 ) 221 Gains (losses) on extinguishment of debt – – 2,421 – Change in fair value of financial instruments (25,071 ) (76,020 ) (49,210 ) (175,777 ) Income (loss) before taxes and discontinued operations (19,031 ) (61,011 ) (26,693 ) (146,313 ) Income tax benefit (provision) 21 673 260 634 Net income (loss) (19,010 ) (60,338 ) (26,433 ) (145,679 ) (Income) loss allocated to preferred shares (7,415 ) (5,589 ) (13,221 ) (10,807 ) (Income) loss allocated to noncontrolling interests 775 50 (583 ) 77 Net income (loss) allocable to common shares $ (25,650 ) $ (65,877 ) $ (40,237 ) $ (156,409 ) Earnings (loss) per share—Basic: Total earnings (loss) per share—Basic $ (0.31 ) $ (0.94 ) $ (0.50 ) $ (2.40 ) Weighted-average shares outstanding—Basic 81,778,947 69,757,807 80,636,895 65,086,432 Earnings (loss) per share—Diluted: Total earnings (loss) per share—Diluted $ (0.31 ) $ (0.94 ) $ (0.50 ) $ (2.40 ) Weighted-average shares outstanding—Diluted 81,778,947 69,757,807 80,636,895 65,086,432

RAIT Financial Trust
Consolidated Balance Sheets
(Dollars in thousands, except share and per share information)
(unaudited)

As of
June 30,
2014

As of
December 31,
2013

Assets Investments in mortgages and loans, at amortized cost: Commercial mortgages, mezzanine loans, other loans and preferred equity interests $ 1,323,677 $ 1,122,377 Allowance for losses (15,336 ) (22,955 ) Total investments in mortgages and loans 1,308,341 1,099,422 Investments in real estate, net of accumulated depreciation of $145,751 and $127,745, respectively 1,268,769 1,004,186 Investments in securities and security-related receivables, at fair value 574,178 567,302 Cash and cash equivalents 75,079 88,847 Restricted cash 102,189 121,589 Accrued interest receivable 52,857 48,324 Other assets 72,165 57,081 Deferred financing costs, net of accumulated amortization of $21,484 and $17,768, respectively 22,469 18,932 Intangible assets, net of accumulated amortization of $8,960 and $4,564,

respectively

23,100 21,554 Total assets $ 3,499,147 $ 3,027,237 Liabilities and Equity Indebtedness: Recourse indebtedness $ 353,145 $ 235,011 Non-recourse indebtedness 2,064,025 1,851,390 Total indebtedness 2,417,170 2,086,401 Accrued interest payable 31,177 26,936 Accounts payable and accrued expenses 28,683 32,447 Derivative liabilities 95,974 113,331 Deferred taxes, borrowers’ escrows and other liabilities 128,665 79,462 Total liabilities 2,701,669 2,338,577

Series D Preferred Shares, 4,000,000 shares authorized, 4,000,000 and

2,600,000 shares issued and outstanding

74,723

52,970

Equity:

Preferred shares, $0.01 par value per share, 25,000,000 shares authorized:

7.75% Series A cumulative redeemable preferred shares, liquidation

preference $25.00 per share, 8,069,288 and 4,760,000 shares

authorized, 4,069,288 shares issued and outstanding

41

41

8.375% Series B cumulative redeemable preferred shares, liquidation

preference $25.00 per share, 4,300,000 shares authorized, 2,288,465

shares issued and outstanding

23

23

8.875% Series C cumulative redeemable preferred shares, liquidation

preference $25.00 per share, 3,600,000 shares authorized, 1,640,100

shares issued and outstanding

17

17

Series E cumulative redeemable preferred shares, liquidation preference

$25.00 per share, 4,000,000 shares authorized

Common shares, $0.03 par value per share, 200,000,000 shares authorized,

82,507,410 and 71,447,437 issued and outstanding, including 541,825

and 369,500 unvested restricted common share awards

2,474

2,143

Additional paid in capital 2,007,593 1,920,455 Accumulated other comprehensive income (loss) (50,226 ) (63,810 ) Retained earnings (deficit) (1,326,186 ) (1,257,306 ) Total shareholders’ equity 633,736 601,563 Noncontrolling interests 89,019 34,127 Total equity 722,755 635,690 Total liabilities and equity $ 3,499,147 $ 3,027,237

Schedule I
RAIT Financial Trust
Reconciliation of Net income (loss) Allocable to Common Shares and
Cash Available for Distribution (1)
(Dollars in thousands, except share and per share amounts)
(unaudited)

For the Three-Month Period
Ended June 30,

For the Six-Month Period Ended
June 30,

2014 2013 2014 2013

Amount

Per Share
(2)

Amount

Per Share
(3)

Amount

Per Share
(2)

Amount

Per Share
(3)

Cash Available for Distribution: Net income (loss) allocable to common shares $(25,650) $ (0.31) $(65,877) $(0.94) $(40,237) $ (0.50) $(156,409) $(2.40) Adjustments: Depreciation and amortization expense 13,441 0.16 8,618 0.12 25,483 0.32 17,188 0.26 Change in fair value of financial instruments 25,071 0.32 76,020 1.09 49,210 0.61 175,777 2.69 (Gains) losses on assets 7,599 0.09 (224) 0.00 5,375 0.07 (221) 0.00 (Gains) losses on extinguishment of debt – – – – (2,421) (0.03) – – Taberna VIII and Taberna IX securitizations, net effect (7,028) (0.09) (9,526) (0.14) (14,088) (0.18) (18,002) (0.28) Straight-line rental adjustments 24 0.00 (678) (0.01) (91) 0.00 (966) (0.01) Share-based compensation 1,180 0.01 743 0.01 2,629 0.03 1,466 0.02 Origination fees and other deferred items 5,181 0.06 2,300 0.03 9,732 0.12 2,978 0.05 Provision for losses 1,000 0.01 500 0.01 2,000 0.03 1,000 0.02 Noncontrolling interest effect from certain adjustments (1,095) (0.01) (9) 0.00 (635) (0.01) (9) 0.00 Cash Available for Distribution $19,723 $0.24 $11,867 $0.17 $36,957 $0.46 $22,802 $0.35 (1) Cash available for distribution, or CAD, is a non-GAAP financial measure. We believe that CAD provides investors and management with a meaningful indicator of operating performance. Management also uses CAD, among other measures, to evaluate profitability and our board of trustees considers CAD in determining our quarterly cash dividends. We also believe that CAD is useful because it adjusts for a variety of noncash items (such as depreciation and amortization, equity-based compensation, realized gain (loss) on assets, provision for loan losses and non-cash interest income and expense items). Furthermore, CAD removes the effect from our consolidation of the legacy Taberna securitizations. We calculate CAD by subtracting from or adding to net income (loss) attributable to common shareholders the following items: depreciation and amortization items including, depreciation and amortization, straight-line rental income or expense, amortization of in place leases, amortization of deferred financing costs, amortization of discount on financings and equity-based compensation; changes in the fair value of our financial instruments, including such changes reflected in our consolidated Taberna securitizations; net interest income from consolidated Taberna securitizations; realized gain (loss) on assets and other; provision for loan losses; impairment on depreciable property; acquisition gains or losses and transaction costs; certain fee income eliminated in consolidation that is attributable to third parties and one-time events pursuant to changes in U.S. GAAP and certain other non-recurring items. CAD should not be considered as an alternative to net income (loss), determined in accordance with U.S. GAAP, as an indicator of operating performance. In addition, our methodology for calculating CAD may differ from the methodologies used by other comparable companies, including other REITs, when calculating the same or similar supplemental financial measures and may not be comparable with these companies. In these Schedules, references to “we”, “us”, and “our” refer to RAIT Financial Trust and its subsidiaries. (2) Based on 81,778,947 and 80,636,895 weighted-average shares outstanding-diluted for the three-month period and six-month period ended June 30, 2014. (3) Based on 69,757,807and 65,086,432 weighted-average shares outstanding-diluted for the three-month period and six-month period ended June 30, 2013.

Schedule II
RAIT Financial Trust
Reconciliation of Shareholders’ Equity to Adjusted Book Value (1)
(Dollars in thousands, except share and per share amounts)
(unaudited)

As of June 30, 2014 Amount Per Share (2) Total shareholders’ equity $ 633,736 $ 7.68 Liquidation value of preferred shares characterized as equity(3) (199,946) (2.42) Book value 433,790 5.26 Adjustments: Taberna VIII and Taberna IX securitizations, net effect (187,864) (2.29) RAIT I and RAIT II derivative liabilities 31,102 0.38 Change in fair value for warrants and investor SARs 18,820 0.23 Accumulated depreciation and amortization 183,932 2.23 Valuation of recurring collateral and property management fees 57,479 0.70 Total adjustments $ 103,469 $ 1.25 Adjusted book value $ 537,259 $ 6.51 (1) Management views adjusted book value as a useful and appropriate supplement to shareholders’ equity and book value per share. The measure serves as an additional measure of our value because it facilitates evaluation of us without the effects of various items that we are required to record in accordance with GAAP but which have limited economic impact on our business. Those adjustments primarily reflect the effect of consolidated securitizations where we do not currently receive cash flows on our retained interests, accumulated depreciation and amortization, the valuation of long-term derivative instruments and a valuation of our recurring collateral and property management fees. Adjusted book value is a non-GAAP financial measurement, and does not purport to be an alternative to reported shareholders’ equity, determined in accordance with GAAP, as a measure of book value. Adjusted book value should be reviewed in connection with shareholders’ equity as set forth in our consolidated balance sheets, to help analyze our value to investors. Adjusted book value may be defined in various ways throughout the REIT industry. Investors should consider these differences when comparing our adjusted book value to that of other REITs. (2) Based on 82,507,410 common shares outstanding as of June 30, 2014. (3) Based on 4,069,288 Series A preferred shares, 2,288,465 Series B preferred shares, and 1,640,100 Series C preferred shares outstanding as of June 30, 2014, all of which have a liquidation preference of $25.00 per share.

Schedule III
RAIT Financial Trust
Reconciliation of Net income (loss) Allocable to Common Shares and
Funds From Operations (“FFO”) and
Adjusted Funds From Operations (“AFFO”) (1)
(Dollars in thousands, except share and per share amounts)
(unaudited)

For the Three-Month Period Ended
June 30,

For the Sixth-Month Period Ended
June 30,

2014 2013 2014 2013

Amount

Per Share
(2)

Amount

Per Share
(3)

Amount

Per Share
(2)

Amount

Per Share
(3)

Funds From Operations: Net income (loss) allocable to common shares $(25,650) $ (0.31) $(65,877) $ (0.94) $(40,237) $ (0.50) $(156,409) $ (2.40) Adjustments: Real estate depreciation and amortization 9,315 0.11 8,050 0.11 18,134 0.23 16,023 0.24 (Gains) losses on the sale of real estate – – 1,326 0.02 321 0.00 1,326 0.02 Funds From Operations $(16,335) $(0.20) $(56,501) $(0.81) $(21,782) $(0.27) $(139,060) $(2.14) Adjusted Funds From Operations: Funds From Operations $(16,335) $(0.20) $(56,501) $(0.81) $(21,782) $(0.27) $(139,060) $(2.14) Adjustments: Change in fair value of financial instruments 25,071 0.32 76,020 1.09 49,210 0.61 175,777 2.69 (Gains) losses on debt extinguishment – – – – (2,421) (0.03) – – Capital expenditures, net of direct financing (1,295) (0.02) (797) (0.01) (1,942) (0.02) (969) (0.01) Straight-line rental adjustments 24 0.00 (678) (0.01) (91) 0.00 (966) (0.01) Amortization of deferred items and intangible assets 7,414 0.09 3,267 0.05 13,831 0.17 4,400 0.07 Share-based compensation 1,180 0.01 743 0.01 2,629 0.03 1,466 0.02 Adjusted Funds From Operations $16,059 $0.20 $22,054 $0.32 $39,434 $0.49 $40,648 $0.62 (1) We believe that funds from operations, or FFO, and adjusted funds from operations, or AFFO, each of which are non-GAAP measures, are additional appropriate measures of the operating performance of a REIT and us in particular. We compute FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts, or NAREIT, as net income or loss allocated to common shares (computed in accordance with GAAP), excluding real estate-related depreciation and amortization expense, gains or losses on sales of real estate and the cumulative effect of changes in accounting principles. AFFO is a computation made by analysts and investors to measure a real estate company’s cash flow generated by operations. We calculate AFFO by adding to or subtracting from FFO: change in fair value of financial instruments; gains or losses on debt extinguishment; capital expenditures, net of any direct financing associated with those capital expenditures; straight-line rental effects; amortization of various deferred items and intangible assets; and share-based compensation. Our calculation of AFFO differs from the methodology used for calculating AFFO by certain other REITs and, accordingly, our AFFO may not be comparable to AFFO reported by other REITs. Our management utilizes FFO and AFFO as measures of our operating performance, and believes they are also useful to investors, because they facilitate an understanding of our operating performance after adjustment for certain non-cash items, such as real estate depreciation, share-based compensation and various other items required by GAAP that may not necessarily be indicative of current operating performance and that may not accurately compare our operating performance between periods. Furthermore, although FFO, AFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we also believe that FFO and AFFO may provide us and our investors with an additional useful measure to compare our financial performance to certain other REITs. Neither FFO nor AFFO is equivalent to net income or cash generated from operating activities determined in accordance with U.S. GAAP. Furthermore, FFO and AFFO do not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Neither FFO nor AFFO should be considered as an alternative to net income as an indicator of our operating performance or as an alternative to cash flow from operating activities as a measure of our liquidity. (2) Based on 81,778,947 and 80,636,895 weighted-average shares outstanding-diluted for the three-month period and six-month period ended June 30, 2014. (3) Based on 69,757,807 and 65,086,432 weighted-average shares outstanding-diluted for the three-month period and six-month period ended June 30, 2013. FinanceInvestment & Company Information Contact: RAIT Financial Trust

Andres Viroslav, 215-243-9000

aviroslav@rait.com […]

Vice President Biden Admits He Occasionally Takes Out Payday …

Image Joe-Biden.jpg

Vice President Joe Biden appeared with Al Sharpton this morning on MSNBC where he spoke candidly about Hillary Clinton, his 2016 presidential aspirations and the financial hardships his family has faced since becoming the vice president. Following is a transcript of that discussion which will air this evening on Sharpton’s show, PoliticsNation, on MSNBC.

AL SHARPTON: Tonight I want to welcome a guest on my own show where I host. Tonight that guest is Joe Biden who is President Obama’s vice president. Welcome to my show, Mr. Vice.

JOE BIDEN: It’s a pleasure to be with you.

AL SHARPTON: Mr. Vice, I want to start off by asking you about Hillary Clinton saying she was broke when she was removed from the White House.

JOE BIDEN: I’ve heard Hillary talk about the financial struggles she and President Clinton faced in the early days of their post presidency. Believe me, I know how stressful it can be struggling to make ends meet.

AL SHARPTON: You’ve struggled too?

JOE BIDEN: Oh sure. I’m still struggling. Like so many Americans, Jill and I lie awake nights worrying about having enough money to pay the bills.

AL SHARPTON: Pay the bills? But you eat in fancy restaurants with President Obama. You stay in nice hotels. And that suit you’re wearing, it looks pretty expensive.

JOE BIDEN: (chuckles) I couldn’t afford a suit like this. This is a suit Al Gore left behind at the vice presidential mansion.

AL SHARPTON: Get outta here!

JOE BIDEN: It’s true. We found boxes of expensive suits in the attic that he out grew when he got fat.

AL SHARPTON: Well he’s rich enough now to buy all the fat clothes he wants. He has more money than the Clintons. Maybe even Oprah.

JOE BIDEN: I think it even surprised him how lucrative his global warming show became.

AL SHARPTON: And it made him a lot of money, too. You know, people are going to be shocked that you have to wear Al Gore’s clothes.

JOE BIDEN: Everybody thinks because you’re the vice president you’re rolling in dough. I wish it were true, but it’s not. I’m no different than millions of other Americans who struggle every month to make ends meet.

AL SHARPTON: Hillary said they had to borrow money to buy houses.

JOE BIDEN: She was fortunate to know wealthy people willing to lend her large sums of money.

AL SHARPTON: You tellin’ me you don’t know any rich people?

JOE BIDEN: As the vice president I interact with wealthy people all the time. But the Biden family’s friends are mostly blue collar workers. Just regular folks struggling to get by. Unfortunately, many of them are unemployed. So no, there isn’t anybody to borrow money from. And even if there were, we’d never be able to pay it back.

AL SHARPTON: So how do you get by?

JOE BIDEN: Well, like millions of other Americans, Jill and I live on a tight budget. But even then there are the unexpected expenses that always seem to occur during the the lean times. When the brakes on the car go out or the roof starts to leak.

AL SHARPTON: How do you manage during those times?

JOE BIDEN: Sometimes I’ve had to take a payday loan. It doesn’t happen very often, but there have been times it’s been my only option.

AL SHARPTON: But you’re the vice president of America. Can’t you just go get some money from the place where they make it?

JOE BIDEN: (chuckling) Oh, if it were only that simple. Look, I don’t want anyone thinking we’re going hungry or anything. We’ve eaten for free at the White House plenty of times. But every now and then when our backs are against the wall financially, I’ll head over to an inner city check cashing business and get a payday loan. It’s no big deal. Lots of Americans do it. I’m no better than they are, even if I am the vice president of the United States.

AL SHARPTON: But my producers told me your wife is a doctor. Can’t she do a few brain surgeons or something? I would think that would bring in a substandard amount of cash.

JOE BIDEN: Well, she’s not that kind of doctor. Her doctorate is in education.

AL SHARPTON: So let her operate on some teachers.

JOE BIDEN: Although Jill’s duties as the second lady keep her very busy, sometimes on her days off the president will slip her a few bucks to do errands for his mother-in-law.

AL SHARPTON: We only have time for one more last question. If Hillary becomes president, would you considerate being her vice?

JOE BIDEN: (chuckles) Well, I haven’t ruled out putting my own oar in the presidential waters.

AL SHARPTON: (surprised) Whoa, Mr. Vice! You’re gonna to get the wrath of the feminalists for that one. Maybe even from Mr. Clinton, too.

JOE BIDEN: (Looks confused, but smiles and winks anyway)

AL SHARPTON: OK, that’s all the time we have. Thank you for the vice president in joining me on my show, where I host.

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[…]

A Look at the Status of the Payday Loan Sector | NationofChange

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For commentators on the payday loans sector, these have had a busy few months with new initiatives and regulation. The payday industry has been a hive of activity. Here we take a look at the goings on and implications for the industry and consumer.

Industry Initiatives

OpenWonga

As a response to asking MPs not to bracket all payday loan customers as needy or vulnerable, payday lender Wonga has published OpenWonga. This site provides data about Wonga customers which includes:

? why they borrow;

? how much they borrow;

? the length of a loan;

? where they live;

? a typical customer profile including age, martial stats and any dependants.

They also have a news and view sections. Here they publish comments and share feedback from their customers.

MODA

One of the major breakthroughs the industry hopes to have solved is that, up until recently, credit files took a long time to update. This has meant that borrowers could in effect apply to multiple lenders in a short amount of time and even with credit checks, the other activities would not be registered as they were not showing on their credit file (which can take up to 28 days to update).

This has led to many people falling into debt with payday loans by having multiple interest and fee charges which has then spiralled them further into debt. While this is really an issue of customers “gaming the system” rather than a seedy practice of lenders, the industry hopes the launch of MODA, will remove this from continuing.

MODA will provide real time access to payday loan applications across a number of the larger lenders at 15 minute intervals. This will hopefully mean that multiple applications across several lenders will stop. This in itself will go a long way to prevent people going into debt. It will also help with the stricter regulations we discuss below.

Regulation

Financial Conduct Authority (FCA)

The new consumer credit watchdog the FCA has taken little time to publish new rules for the industry which came into force on the 1st July 2014.

The rules include:

? adding financial health warnings on all emails, online ads and texts;

? signposting people to free debt advice;

? more stringent affordability checks to make sure borrowers can make repayments;

? clearer display of fees and costs associated with failure to repayment a loan in full and on time;

? the restriction of roll overs. The industry had a self suggested maximum of three but the regulator has made this two;

? the freezing of interest and fees if the customer rolls over more twice;

? restrictions on the use of Continuous Payment Authorities (CPA) to recover owed monies from a borrower’s account.

There have been a number of lenders that have pulled out of the market due to the regulation, so the regulator hopes this will remove the rogue elements.

There is still further legislation planned as the Chancellor has tasked the Authority to devise and implement a structure for a total cost of credit cap in the hope to further protect customers.

Competition and Markets Authority (CMA)

The CMA is the replacement organisation for the old Competition Commission, who were tasked with looking at the competitiveness of the payday loan market. They reported their preliminary findings in June this year and some of the highlights included:

? the lack of an independent price comparison website for payday loans meant that customers were paying more than they should for short term finance;

? publishing an independent price comparison website;

? clearer, upfront notification of borrowing costs if a loan is not paid back on time or in full;

? recommending that brokers who pass leads to payday lenders are more transparent as to how their service operates and the fees they charge for their service.

Summary

The hope is that with clearer regulation, consumers will be both educated about the pitfalls of loans and at the same time be offered better regulated finance products which will clearly highlight any fees.

In the future, a price comparison site could help save the consumer money as they can easily shop around to find the most cost-effective loan. It is clear at this stage that the Government are not trying to legislate the industry out of existence, but to clean house. After all, there is still huge demand for short term finance and without a payday loan industry, it is hard to see where people will turn to for help. There may be other options but none seem to have the same level of investment or appetite to lend.

[…]

Beware of Payday Loans | Rosenberg & Press

Q: Are payday loans dischargeable in bankruptcy?

A: Yes, you can list a payday loan on your bankruptcy schedules, however you should realize that it will have little to no effect. Payday loans by their very nature are illegal. Filing bankruptcy to remove payday loans is like asking your mugger to put his gun away and leave you alone because you have diplomatic immunity. The mugger doesn’t care.

Worse than that, you have given over all of your personal information to some nameless people in some distant country. They have sold your information countless times and are very likely engaging in identity theft all over the world with your formerly good name. You would be well advised to consider checking your credit report regularly now and perhaps even putting a freeze on it. Some of the people that I have come in contact with recently that are con-artist/pay day loan people are O’Bannion and Water Arbitration and Private Courier. They use innocuous names like Patrick and claim to be working out of the Sears Tower in Chicago, but in reality these payday loan people are working out of their homes on burner cell phones in India and Asia.

They will lie and tell you they are government agencies or even the police. They use fear and intimidation to steal your money. And many scared people willingly part with their money in hopes that they will go away. Unfortunately, they are like cats. If you put out a bowl of milk, the street cats will remember to come back time and time again looking for more. It just shows them you are an easy mark.

The moral of this story is never under any circumstances take a payday loan. Half the time they do not send the money. When they do, they charge usurious illegal interest rates and they steal your identity and threaten you forever like a loan shark. They say you can’t con an honest person, but its debatable when you look at the payday loan schemes.

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For individuals that are thinking about taking out a payday loans Now

You should know when it will be easy to pay out it returning. The klicka för info mortgage rates on most of these financing is particularly outstanding. You will definitely incur other and major prices should you not invest them rear immediately.

Telephone roughly to find out consideration fees and prices. Most fast cash advance businesses have much the same focus and expenses rates, and not all. If a person organization provides for a much lower interest rate, you could probably protect 10 or 20 $ in your own bank loan. The savings will prove to add up if you decide to often get these financing.

Review many types of payday advance vendors ahead of when deciding in one. There are various specialists around the world. A few of which can charge you problematic payments, and charges versus other options. In actual fact, some could quite possibly have temporary special deals, that truly really make a difference on the total price. Do your persistence, and ensure you are finding the best deal plausible.

Really think wisely about how much cash you need. It will be tempting to getting a mortgage for a lot more than you must have, nonetheless the a higher price you ask for, the higher the rates of interest shall be. Some services may only specific you for your certain quantity, although but not only, that. Get the cheapest sum you should have.

Comparison shop before taking out a payday advance, to protect yourself from exorbitant prices. There can be a range of agencies in your neighborhood that come with payday loans, and some of those businesses can potentially feature stronger interest rates than others. You could possibly not spend as much when it is an opportunity to payback the borrowed funds, by reviewing round.

Investigate the organisation regarding the Even better Commercial enterprise Bureau’s website page, before making one more judgment associated with a cash advance online business to select. There are tons of questionable establishments around scamming people that are really requiring assistance. Take your time to know if the establishment you are searching for is at the up or higher.

An essential word of advice for those trying to obtain payday loans is certainly not to vår webbplats rest regarding your job application. To get a loan authorized or perhaps superior amount borrowed, however it is, infraud and truth, and you can be incurred criminally for it, laying regarding your app will be alluring.

With regards to a fast cash advance location, do in-depth evaluation on the lending supplier. There is a myriad of possibilities open within this subject, and so you want to actually are dealing with a authentic company who has operations set up to guarantee the mortgage loan is affordable and good monitored. Locate user reviews from past years consumers for more answers.

When considering taking out a cash advance loan, be sure to see the payment approach. At times you have to submit the lending company a article outdated visit that they will cash on the owing meeting. In other cases, you will just have to provide them with your banking account specifics, and they can on auto-pilot deduct your monthly payment with your credit account.

Very often, you should have a very checking account to get a payday advance loan. The reason being that loan merchants in most cases require that you approve focused monthly payment out of your bank checking account their day the financing arrives. It will probably be taken once your salary is reserved that will be transferred.

There can be status rules, and regulations that specifically pay for cash loans. Often these organizations found ways of give good results all-around them officially. Should you check out a payday advance, do not presume that you may be able to find out of it without having to pay them back fully.

You better think again if you happen to thinking you might have to normal at a fast payday loan. The obligation agencies collect a lot of knowledge from you about things such as your manager, together with your correct. They will likely harass you frequently up until you choose the loan product paid back. It is better to obtain from family members, sell important things, or do other things it will take only to pay for the bank loan off of, and move ahead.

Be certain to find your payday loans meticulously. Consider the amount of time you actually are provided with to repay the loan and precisely what the mortgage rates are similar to prior to buying your payday cash loan. See what your best choices are and then make your variety in order to save extra money.

Never go to secure a online payday loan unfilled-handed. In order to get financing, you should provide numerous stuff for you. These include about three up to date repay stubs, proper id, and proof a bank checking account. The prerequisites range between industry to small business. It is a great idea to phone to begin with, and get what you will have to convey.

Tend not to enter a pay day loan ability this is not 100% really clear, in creating, around the loan rates which will be charged. In case the financing is due for på huvudsidan repayment. Any business designed to not make known this info up-front, is almost certainly a scam. You might find yourself with covered costs, and charges you have no clue about.

Quite a few people use them while they are not within turmoil or emergency instance, due to loan merchants are making it so easy to obtain a cash advance. They really are in your terrible location since they are now overextended, this will likely contribute to folks to turned out to be nice make payment on high rates of interest and when a crisis arises.

Ensure that you understand exactly if you should payback your cash advance. Payday cash loans have especially high rates of interest. Services normally price extortionate expenses for past due obligations. Accordingly, you must be certain that you payback the loan entirely on, or ahead of when, the arranged payback meeting.

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