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The Payday Loan Rule Changes That Only Payday Lenders Want …

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Follow the money: payday lenders gave significant campaign money to legislators who are now trying to undo Washington State’s landmark payday lending reforms.dcwcreations / Shutterstock.com

Washington State passed some of the strongest payday lending reforms in the nation in 2009. But now a group of lawmakers want to scrap those reforms in favor of a proposal backed by Moneytree, a local payday lender.

The rule changes they’re going after limit the size and frequency of payday loans and provide a free installment plan option to help borrowers who can’t pay back their loan when it’s due.

According to data from the Department of Financial Institutions, these reforms hit payday lenders hard. In fact, before the reforms took effect, payday loans were available at 603 locations across Washington and lenders were making more than $1.3 billion in loans per year. Last year, there were only 173 locations and it was a $331 million industry.

Now, a proposal, sponsored by Rep. Larry Springer, D-Kirkland, and Sen. Marko Liias, D-Lynnwood, would replace the payday loan system in Washington with a “small consumer installment loan” system that would clear the way for lenders like Moneytree to start offering 6-month to 12-month loans with effective interest rates up to 213 percent.

The proposed law would also increase the maximum size of a loan from $700 to $1,000 and remove the current eight-loan cap, effectively removing the circuit breaker keeping borrowers from getting trapped in a debt cycle.

What’s more, instead of the easy-to-understand fee payday loans we have now, the new loans would have a much more complex fee structure consisting of an amortized 15 percent origination fee, a 7.5 percent monthly maintenance fee, and a 36 percent annual interest rate.

It is incomprehensible, after years of working on payday reforms that finally worked in Washington, that lawmakers would throw out that law and replace it with one created by Moneytree.” says Bruce Neas, an attorney with Columbia Legal Services, a group that provides legal assistance to low-income clients.

Proponents say the new system could save borrowers money. And they’re right, technically, since interest and fees accrue over the life of the loan. However, a loan would need to be paid off in around five weeks or less for that to pencil out—and that seems highly unlikely. In Colorado, which has a similar installment loan product, the average loan is carried for 99 days. What’s more, according the National Consumer Law Center, “loan flipping” in Colorado has led to borrowers averaging 333 days in debt per year, or about 10.9 months.

While numerous consumer advocates have spoken out against the proposal—along with payday loan reform hawks like Sen. Sharon Nelson, D-Maury Island, and even the state’s Attorney General—few have voiced support for it. In fact, in recent committee hearings on the proposal, only four people testified in favor of it:

Dennis Bassford, CEO of Moneytree;

Dennis Schaul, CEO of the payday lending trade organization known as the Consumer Financial Services Association of America;

Rep. Larry Springer, prime House sponsor of the proposal and recipient of $2,850 in campaign contributions from Moneytree executives;

Sen. Marko Liias, prime Senate sponsor of the proposal and recipient of $3,800 in campaign contributions from Moneytree executives.

Springer and Liias aren’t the only state legislators Moneytree executives backed with campaign contributions, though. In the past two years, executives with Moneytree have contributed $95,100 to Washington State Legislature races.

At least 65 percent of the money went to Republicans and the Majority Coalition Caucus. Which is expected, since Republicans have been loyal supporters of Moneytree in the past. When a similar proposal was brought to the Senate floor two years ago, only one Republican voted against it.

More telling is where the remaining money went. Of the $33,150 Moneytree gave to Democrats, $20,500 went to 11 of the 16 Democratic House sponsors of the proposal and $5,700 went to two of the four Democratic Senate sponsors.

Both the Senate and House versions of the proposal have cleared their first major hurdles by moving out of the policy committees. The bills are now up for consideration in their respective chamber’s Rules Committee. The Senate version appears to be the one most likely to move to a floor vote first, since the Republican Majority Coalition Caucus controls the Senate.

Regardless of which bill moves first, payday lenders undoubtedly want to see it happen soon.

The Consumer Financial Protection Bureau, established by Congress in response to the Great Recession, is poised to release their initial draft of regulations for payday lenders. Although the agency’s deliberations are private, it is widely believed the rules will crack down on the number and size of loans payday lenders can make.

Those rules may well affect Moneytree and other payday lenders Washington.

In the likely chance they do, payday lenders could see their profits shrink. Unless, that is, Washington scraps its current system in favor of one carefully crafted by payday lenders looking to avoid federal regulators.

[…]

BBB Warns of the Pitfalls of Payday Loans

Some payday loans carry interest rates as much as 400% to 700% and may not allow early pay offs.

Southfield, MI (PRWEB) December 19, 2014

Consumers who have financial trouble during the holidays may be enticed to bridge the gap between paychecks by obtaining a payday loan. Better Business Bureau (BBB) Serving Eastern Michigan is warning consumers to be cautious, as these loans typically have very high fees and interest rates as well as questionable sales and collection tactics that confuse and intimidate borrowers.

Payday loans are loans of short duration, usually two weeks, and can be obtained from a physical payday loan store or on the internet. Better Business Bureau receives hundreds of complaints against payday loan companies alleging threats of arrest and notifications to employers about their debt. Complaints also state that consumers who apply for loans online, may not see the full disclosure of interest rates or fees until after they have signed the documents and that there are unauthorized withdrawals from their bank accounts.

Typically, payday lenders do not perform a credit check but ask borrowers to write them a post-dated check for the amount they borrow plus a borrowing and account set-up fee. The lenders will then deposit the check after the borrower’s payday if they have not already paid off the loan. If the borrower’s bank account cannot cover the amount of the loan, they will then owe the original loan plus added interest and they may also incur overdraft fees from their bank. Borrowers can chose to pay more fees to renew the loan if they know they cannot pay it off in time. This practice creates a cycle of consumer refinancing and continuous debt.

Payday loans are regulated in Michigan in most cases. For example, a payday lender can only have one outstanding payday loan per customer for a loan amount of up to $600. A customer may take out a second loan with a different payday lender, and can only have two outstanding payday loans at any given time. The payday lender may charge up to 15% on the first $100, 14% on the second $100, 13% on the third $100, 12% on the fourth $100, and 11% on the fifth and sixth $100.

Consumers should be aware that some payday loan companies, such as those operated by Native American tribes, may have tribal sovereign immunity from laws that govern other lenders. These loans often carry interest rates as much as 400% to 700% and may not allow early pay offs, resulting in a cycle of perpetual debt for the borrower. The Consumer Financial Protection Bureau recently released a report that analyzed payday lending and found that four out of five payday loans are rolled over or renewed within 14 days.

Alternatives to Payday Loans

Before you decide to take out a payday loan, consider some alternatives:

1. Consider a small loan from your credit union or a small loan company. Some banks may offer short-term loans for small amounts at competitive rates. A local community-based organization may make small business loans to people. A cash advance on a credit card also may be possible, but it may have a higher interest rate than other sources of funds: find out the terms before you decide. In any case, shop first and compare all available offers.

2. Shop for the credit offer with the lowest cost. Compare the APR and the finance charge, which includes loan fees, interest and other credit costs. You are looking for the lowest APR. Military personnel have special protections against high fees or rates, and all consumers in some states and the District of Columbia have some protections dealing with limits on rates. Other credit offers may come with lower rates and costs.

3. Contact your creditors or loan servicer as quickly as possible if you are having trouble with your payments, and ask for more time. Many may be willing to work with consumers who they believe are acting in good faith. They may offer an extension on your bills; make sure to find out what the charges would be for that service — a late charge, an additional finance charge, or a higher interest rate.

4. Contact your local consumer credit counseling service if you need help working out a debt repayment plan with creditors or developing a budget. Non-profit groups in every state offer credit guidance to consumers for no or low cost. You may want to check with your employer, credit union, or housing authority for no- or low-cost credit counseling programs, too.

5. Make a realistic budget, including your monthly and daily expenditures, and plan, plan, plan. Try to avoid unnecessary purchases: the costs of small, every-day items like a cup of coffee add up. At the same time, try to build some savings: small deposits do help. A savings plan — however modest — can help you avoid borrowing for emergencies. Saving the fee on a $300 payday loan for six months, for example, can help you create a buffer against financial emergencies.

6. Find out if you have — or if your bank will offer you — overdraft protection on your checking account. If you are using most or all the funds in your account regularly and you make a mistake in your account records, overdraft protection can help protect you from further credit problems. Find out the terms of the overdraft protection available to you — both what it costs and what it covers. Some banks offer “bounce protection,” which may cover individual overdrafts from checks or electronic withdrawals, generally for a fee. It can be costly, and may not guarantee that the bank automatically will pay the overdraft.

The bottom line on payday loans: Try to find an alternative. If you must use one, try to limit the amount. Borrow only as much as you can afford to pay with your next paycheck — and still have enough to make it to next payday.

Collection activities are subject to the federal Fair Debt Collection Practices Act. Therefore, if you have questions regarding debt collection laws please contact the Federal Trade Commission at 1-877-FTC HELP, or online at http://www.ftc.gov. Debt collectors cannot state or imply that failure to pay a debt is a crime.


[…]

ACE Cash Express Joins the Green Dot Reload Network, Adding 1,500 Locations

PASADENA, Calif.–(BUSINESS WIRE)–

ACE Cash Express, Inc. (ACE) and Green Dot Corporation (GDOT) have signed a distribution agreement, making ACE an authorized retailer for the Green Dot Reload Network. Beginning this month, any cardholder with a Green Dot Network-enabled prepaid card can now reload cash to their card at any of ACE’s 1,500 locations in 35 states and the District of Columbia. Additionally, in 2015, Green Dot will begin selling other Green Dot-branded products at ACE locations.

Green Dot owns and operates the nation’s largest reload network. More than 200 programs representing millions of cardholders utilize Green Dot’s network for reload services through approximately 100,000 retail locations nationwide. Green Dot’s recent expansion into leading financial services center (FSC) retailers throughout the U.S. has met with strong retailer and consumer demand. In just the past twelve months, Green Dot has gone from no distribution in this important customer channel to now, with the addition of ACE, nearly 3,000 FSC locations coast to coast selling its products and services.

About ACE Cash Express

ACE Cash Express, Inc. is a leading retailer of financial services, including payday loans, installment loans, title loans, check cashing, bill payment, wire transfer, money orders and prepaid debit card services. ACE is the largest owner and operator of check cashing stores in the United States and the second largest owner and operator of short-term consumer loan stores in the United States. ACE focuses on serving consumers, many of whom seek alternatives to traditional banking relationships in order to gain convenient and immediate access to financial services. For additional information about ACE Cash Express, visit www.acecashexpress.com.

ACE Cash Express on Twitter and ACE Cash Express on Facebook

About Green Dot Corporation

Green Dot Corporation and its wholly owned subsidiary bank, Green Dot Bank, are focused exclusively on serving Low and Moderate Income American families with modern, fair and feature-rich financial products and services, including prepaid cards, checking accounts and cash processing services distributed through a network of some 100,000 retail stores, neighborhood financial service centers and via digital channels. The Company is headquartered in Pasadena, California with Green Dot Bank located in Provo, Utah.

Green Dot Corporation Contact:

Investor Relations

Green Dot Corporation

Christopher Mammone, 626-765-2427

IR@greendot.com

or

Media Relations

ICR for Green Dot Corporation

Brian Ruby, 203-682-8268

PR@greendot.com

or

ACE Cash Express

Victoria Daugherty, 972-550-5161

Communication Manager

vdaugherty@acecashexpress.com […]

Payday lender ACE Cash Express is hit with a $10M fine


Payday lender ACE Cash Express is hit with a $10M fine

28th July 2014 · 0 Comments

By Charlene Crowell
NNPA Writer

(NNPA) – For the second time in as many years, the Consumer Financial Protection Bureau (CFPB) has fined a major payday lender. On July 10, Director Richard Cordray announced that one of the nation’s largest payday lenders, ACE Cash Express, will pay $10 million in restitution and penalties for directing its employees to “create a sense of urgency” when contacting delinquent borrowers. This abusive tactic was used to perpetuate the payday loan debt trap.

CFPB has ordered ACE Cash Express to provide consumers with $5 million in refunds and the same amount in penalties for its violations. The firm operates in 36 states and in the District of Columbia with 1,500 storefronts, 5,000 associates and online loans.

“We believe that ACE’s aggressive tactics were part of a culture of coercion aimed at pressuring payday borrowers into debt traps,” said Cordray. “Our investigation uncovered a graphic in ACE’s training manual that lays out a step-by-step loan and collection process that can ensnare consumers in a cycle of debt. When borrowers could not pay back their loans, ACE would subject them to illegal debt collection threats and harassment.”

Commenting on CFPB’s actions, Mike Calhoun, president of the Center for Responsible Lending, said, “This enforcement action also confirms what our research found long ago: payday lenders depend on keeping vulnerable consumers trapped in an endless cycle of debt of 300-400 percent interest loans. . . .It’s real, it’s abusive and it’s time to stop.”

CRL research shows that payday loans drain $3.4 billion a year from consumers. Further, CRL has long held that the payday industry preys on customers who cannot repay their loans.

Now, with CFPB releasing an item from ACE Cash Express’ training manual, that contention is proven to be true. The ACE graphic shows how the business model intends to create a debt cycle that becomes increasingly difficult to break and urges its associates to be aggressive.

Across the country, the South has the highest concentration of payday loan stores and accounts for 60 percent of total payday lending fees. Missouri is the only state outside of the South with a comparable concentration of payday stores.

Last year, another large payday lender, the Fort Worth-based Cash America International, faced similar enforcement actions when CFPB ordered it to pay $5 million in fines for robo-signing court documents submitted in debt collection lawsuits. Cash America also paid $14 million to consumers through one of its more than 900 locations throughout the United States, Mexico and the United Kingdom.

On the same day that the CFPB’s enforcement action occurred, another key payday- related development occurred.

Missouri Gov. “Jay” Nixon vetoed a bill that purported to be payday reform. In part, Gov. Nixon’s veto letter states, “allowing payday lenders to charge 912.5 percent for a 14-day loan is not true reform. . . Supporters point to the prohibition of loan rollovers; but missing from the legislation is anything to address the unfortunately all-too-common situation where someone living paycheck-to-paycheck is offered multiple loans by multiple lenders at the same time or is encouraged to take out back-to-back loans from the same lender. . . .This bill cannot be called meaningful reform and does not receive my approval.”

Speaking in support of Gov. Nixon’s veto, Pastor Lloyd Fields of Kansas City added, “The faith community applauds Governor Nixon’s moral leadership in holding lawmakers to a higher standard on payday lending reform. Missourians deserve nothing less.”

On the following day, July 11, the Federal Trade Commission (FTC) fined a Florida-based payday loan ‘broker’ $6.2 million in ill-gotten gains. According to FTC, the firm falsely promised to help consumers get payday loans. After promising consumers to assist them in securing a loan in as little as an hour, consumers shared their personal financial data. However that information was instead used to take money from consumers’ bank accounts and without their consent.

Speaking on behalf of the FTC, Jessica Rich, director of FTC’s Bureau of Consumer Protection, said, “These defendants deceived consumers to get their sensitive financial data and used it to take their money. The FTC will continue putting a stop to these kinds of illegal practices.”

Looking forward, CFPB’s Cordray also sees a need to remain watchful of payday developments.

“Debt collection tactics such as harassment and bullying take a profound toll on people – both financially and emotionally”, said Cordray. “The Consumer Bureau bears an important responsibility to stand up for those who are being wronged in this process.”

This article originally published in the July 28, 2014 print edition of The Louisiana Weekly newspaper.

[…]

Announcing a New, Flexible Repayment Term, Low Rate Merchant Cash Advance Option Specifically Designed for Retail …

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Low Rate Merchant Cash Advance at BusinessCashAdvanceGURU.com

Small Business Working Capital at Low Rates, Care of Business Cash Advance Guru

Nationwide (PRWEB) July 24, 2014

For small businesses needing working capital, there’s now a low rate merchant cash advance available without hassle. This fast retail business cash advance loan comes with a low cost and flexible repayment terms. It’s an unsecured business loan and is the best poor credit merchant cash advance available on the market today.

Big banks are not lending working capital to small businesses, according to several recent news reports. The reason given is the wave of new federal lending and banking regulations stymieing the commercial loan market. Traditional lending institutions are in a precarious situation. Banks saddled with huge loan default losses, the result of the Great Recession. During the years 2008 through 2010 and even today, the trend of mortgage, auto loan, credit card, and small business loans defaults put banks hundreds of millions of dollars in the red.

Pressured by congressional members to make risky loans to prop-up the economy from 2004 through 2007, banks complied, only to take the devastating financial hit. The introduction of new legislation sought to curtail future risk, but only after the damage was inflicted.

Small businesses are adversely impacted by such events, having to provide years worth of financial documentation and tax returns, along with substantial collateral. Nearly perfect personal and company credit no longer guarantees commercial funding approval. Qualification standards are now out of reach for the majority of small businesses. Business loan application denial rates are near historic highs though banks continue to hoard billions of dollars in their reserves to weather federally mandated stress tests.

Alternative lenders are now stepping up to fill the commercial financing void, offering great and affordable loan products without a credit file review. This low cost, flexible repayment loan options are available by applying online. There are no application fees or hidden costs associated with these products. Companies can apply for and receive between $5,000 and $500,000 and be approved in just 24 hours. Funds are directly deposited in three to five business days and may be used for any purpose.

Current approval rates stand at 98 percent and monthly payments are based on a percentage of the loan amount rather than a fixed sum.

BusinessCashAdvanceGuru.com expanded nationwide services are now available in the following geographical areas:

Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Washington DC, West Virginia, Wisconsin, and Wyoming.

About Business Cash Advance Guru
http://www.BusinessCashAdvanceGuru.com is a division authorized by TieTechnology, LLC. Business Cash Advance Guru’s merchant cash advance division specializes in helping small business owners realize their dreams. That’s why we created our merchant cash advance program in 2003, and continue to be a merchant cash advance leader in the industry, offering the most flexible payment options and the lowest interest rates and in the business.

About TieTechnology, LLC
http://www.tietechnology.com specializes in small business service based solutions for businesses. Services provided by TieTechnology LLC, include: merchant credit card processing, business service telecommunications, and web based visibility marketing. The advantages of doing business with TieTechnology is their commitment to customer service excellence and their offering of one stop solutions to all business to business service product needs for the customers’ convenience. To learn more about their wide assortment of business services and their specialized divisions, see the following links and descriptions.
fast retail business cash advance


[…]

Announcing a New Source for Reliable, Low Cost Retail Business Cash Advance Loans, Thanks to Alternative Lender …

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Retail Business Cash Advances Available

Available Low Cost Retail Business Cash Advance Loans, Thanks to Alternative Lender, BusinessCashAdvanceGuru.com

Nationwide (PRWEB) July 22, 2014

There’s never been a more straightforward and easy qualification retail business cash advance available to small businesses. With these merchant account cash advance loans, companies can access working capital without a credit check. Competitive merchant cash advance rates are available through this bad credit quick business cash advance program.

The five largest banks in the nation, recently surveyed by news media, state new federal regulations are the primary reason for the high percentage of small business loan rejections. Citing Frank-Dodd, along with previously enacted compliance laws, financing institutions deny commercial loan applications at historical levels. Banks undergo several “stress tests” each year, a result of the economic meltdown which gripped the nation beginning in mid 2008. Now, those same institutions hold billions of dollars in their reserves.

Small business owners with near perfect personal credit files and high company credit scores are routinely denied financing. Banks now require more than good credit. Small business loan approval requires substantial collateral and full disclosure of all personal and company assets and liabilities. In addition, applicant businesses must provide years of tax returns and scores of financial documents for verification. Personal guarantee notes are common and lengthy applications make funding complex.

Banks assert that hundreds of millions of dollars in defaulted consumer loans, ranging from lines of credit to mortgages, to auto loans, require heavier application scrutiny. Traditional banks are not providing access to working capital, still reeling from such large losses. Under pressure from congressional members to offer more financing options, banks are resisting.

However, innovative alternative lenders are filling the void. With new technology and easier lending standards, low cost loans are available without a credit check. No collateral is required, and there are no application fees. Application approvals stand at 98 percent and approval notification comes in just 24 hours. Funds are made available through direct deposit in three to five business days. Funds can be used for any purpose and rates are competitive. Payments are based on a percentage, rather than a fixed dollar amount. Loan amounts range from $5,000 up to $500,000.

BusinessCashAdvanceGuru.com expanded nationwide services are now available in the following geographical areas:

Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Washington DC, West Virginia, Wisconsin, and Wyoming.

About Business Cash Advance Guru

http://www.BusinessCashAdvanceGuru.com is a division authorized by TieTechnology, LLC. Business Cash Advance Guru’s merchant cash advance division specializes in helping small business owners realize their dreams. That’s why we created our merchant cash advance program in 2003, and continue to be a merchant cash advance leader in the industry, offering the most flexible payment options and the lowest interest rates and in the business.

About TieTechnology, LLC

http://www.tietechnology.com specializes in small business service based solutions for businesses. Services provided by TieTechnology LLC, include: merchant credit card processing, business service telecommunications, and web based visibility marketing. The advantages of doing business with TieTechnology is their commitment to customer service excellence and their offering of one stop solutions to all business to business service product needs for the customers’ convenience. To learn more about their wide assortment of business services and their specialized divisions, see the following links and descriptions.


[…]

Introducing the Best New and Most Affordable Restaurant Merchant Cash Advance Loans Available on the Market Today …

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Available Restaurant Merchant Cash Advances

Easy Access Restaurant Working Capital, Thanks to Business Cash Advance Guru

Nationwide (PRWEB) July 13, 2014

Small businesses continue to struggle to find affordable financing options, even well-after the end of the Great Recession. Now, low cost restaurant merchant cash advance loans are available, thanks to alternative lenders. With competitive merchant cash advance rates, these online merchant cash advance options are the best and fastest merchant cash advance loans on the market today.

In the period lasting from mid 2008 through 2009 and into early 2010, the national economic downturn dampened commercial funding greatly. Tough economic circumstances led to a wave of loan defaults, which banks are in the processes of recovering from slowly. Hundreds of millions of dollars in mortgages, auto loans, student loans, credit card lines, home equity, and small business loans remain unpaid.

Making matters worse are dozens of new federal mandates and banking regulations. Small businesses are disproportionately harmed, as a result, with loan denials at near record highs. Loan applications are long and complicated; requirements are stricter and substantial verifications are now normal. In addition, applicant businesses must have near perfect credit and demonstrate the ability to repay in several ways. Loan qualifications are based on future profit and loss projections and personal and business assets and liabilities. Years of tax returns must be provided as well as certified financial statements.

Online merchant cash advance alternative lenders make commercial financing a simple process, not requiring credit history reviews or collateral commitments. In addition, there are no application fees or hidden costs. Approval rates are 98 percent and loan application approvals are delivered within 24 hours. Funds can be used for any purpose and are directly deposited in just three to five business days.

Restaurants can get the funding they need easily and make opportunistic buys, purchase new equipment, or expand their footprint. Businesses may borrow between $5,000 and $500,000, and poor credit is okay. Payment installments are based on a percentage of the loan, not a fixed sum, making these loans very affordable.

Tap into a merchant cash advance today and move business forward for a brighter future. Get funding fast with limited paperwork without a credit check or collateral. Simply fill out the online form to apply and qualify and receive funds in less than a week.

BusinessCashAdvanceGuru.com expanded nationwide services are now available in the following geographical areas:

Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Washington DC, West Virginia, Wisconsin, and Wyoming.

About Business Cash Advance Guru

http://www.BusinessCashAdvanceGuru.com is a division authorized by TieTechnology, LLC. Business Cash Advance Guru’s merchant cash advance division specializes in helping small business owners realize their dreams. That’s why we created our merchant cash advance program in 2003, and continue to be a merchant cash advance leader in the industry, offering the most flexible payment options and the lowest interest rates and in the business.

About TieTechnology, LLC

http://www.tietechnology.com specializes in small business service based solutions for businesses. Services provided by TieTechnology LLC, include: merchant credit card processing, business service telecommunications, and web based visibility marketing. The advantages of doing business with TieTechnology is their commitment to customer service excellence and their offering of one stop solutions to all business to business service product needs for the customers’ convenience. To learn more about their wide assortment of business services and their specialized divisions, see the following links and descriptions.


[…]

Ace Cash Express agrees to pay $10 million to settle allegations

Irving payday lender Ace Cash Express has agreed to pay $10 million to settle what federal regulators called “appalling” predatory tactics to induce borrowers into debt traps.

The consent order with the Consumer Financial Protection Bureau, announced Thursday, comes amid a crackdown by federal and local regulators on aggressive payday lending practices.

The bureau took enforcement action in November against Fort Worth-based payday lender Cash America. In that case, Cash America agreed to pay $19 million to settle allegations of improper debt collection lawsuits and overcharges of military customers.

The bureau said Ace harassed overdue borrowers and threatened lawsuits or criminal prosecution to pressure them to take out additional loans to pay off old ones.

“Ace used false threats, intimidation and harassing calls to bully payday borrowers into a cycle of debt,” CFPB Director Richard Cordray said in a statement. “This culture of coercion drained millions of dollars from cash-strapped consumers who had few options to fight back.”

In a two-page statement, Ace said its policies prevent delinquent borrowers from taking out new loans. The company did not admit or deny any wrongdoing in agreeing to the consent order. Ace agreed to pay $5 million in consumer refunds and a $5 million penalty.

“We settled this matter in order to focus on serving our customers and providing the products and services they count on,” CEO Jay B. Shipowitz said in a statement.

Ace is one of the largest payday lenders in the country. It provides payday loans and other alternative financial products online and at 1,500 stores in Texas and 35 other states as well as the District of Columbia. The company has an annual transaction volume of $14 billion and saw 40 million customer visits over the past year.

Payday loans are meant to address short-term cash needs. They can offer quick access to credit in small amounts that must be repaid in full in a short time.

But critics say these high-interest products bury many consumers under a mountain of debt.

In March, the bureau’s study found 4 of 5 payday loans were being rolled over or renewed within 14 days. It also found that a majority of payday loans were being made to borrowers who end up paying more in fees than the loan’s original amount because they renew the loan so many times.

Consumer advocates applauded the bureau’s latest action against a payday lender.

“I don’t think there’s any question that these companies are on notice that it’s not going to be the Wild West as it was pre-bureau,” said Don Baylor Jr., senior policy analyst at the Austin-based Center for Public Policy Priorities. “Now, you actually have a federal bureau with actual teeth.”

The investigation and enforcement action against Ace resulted from the bureau’s examination of the company, which is part of the agency’s oversight responsibilities.

The bureau said Ace’s training manuals instructed debt collectors to “create a sense of urgency” when contacting overdue borrowers. The bureau found a graphic illustration in a 2011 training manual that spelled out the loan process. It directs employees to offer consumers the option to refinance or extend the loan if borrowers cannot repay.

Ace said in its statement that the bureau’s allegations relate to some of the company’s collection practices before March 2012.

The company retained an independent consultant to review a random sample of the company’s collection calls in response to the bureau’s concerns. Deloitte Financial Advisory Services’ review found that more than 96 percent of Ace’s calls during the review period met “relevant collections standards,” according to the company.

Moreover, the company analyzed data from March 2011 through February 2012 to ensure that its polices preventing a delinquent borrower from taking out new loans were working.

Since 2011, the company said, it also has taken voluntary steps to shore up its compliance program, including hiring full-time legal analysts outside the collections department to monitor calls.

Follow Hanah Cho on Twitter at @hanahcho.

[…]

Introducing a New Merchant Cash Advance Program That’s Affordable, Comes Without a Credit Check or Need for Collateral …

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Merchant Cash Advance Business Expansion

Introducing a Merchant Cash Advance Program that’s Affordable, Comes without a Credit Check, and No Collateral, Courtesy of BusinessCashAdvanceGuru.com

Nationwide (PRWEB) July 04, 2014

In a recent study conducted by a credit marketplace, over 1,000 small business loan application denials were analyzed. The findings reveal five major national chains, corporate banking institutions routinely turned down loans for small businesses. That’s in line with the National Federation of Independent Business, which in its entrepreneur optimism survey, learned that more business owners have a negative outlook on obtaining financing.

However, the merchant cash advance is booming, lending money at a record rate, especially for its products which give small companies an business loan with bad credit. It’s commonly referred to as a business cash advance, and increasingly, more and more entrepreneurs are applying to receive enough business money with a cash advance. The reason is simple; when asked by journalists why banks deny small business loan applications, the overwhelming response given was due to new federal regulations.

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About Business Cash Advance Guru

http://www.BusinessCashAdvanceGuru.com is a division authorized by TieTechnology, LLC. Business Cash Advance Guru’s merchant cash advance division specializes in helping small business owners realize their dreams. That’s why we created our merchant cash advance program in 2003, and continue to be an merchant cash advance leader in the industry, offering the most flexible payment options and the lowest interest rates and in the business.

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Cash U.S. Home Purchases Surging as Rates Rise: Mortgages

Greg Leffel, an investor in Columbus, Ohio, said he relishes cash deals as much as he dislikes home loans. He has spent $150,000 buying and renovating 10 foreclosed houses in the past two years and turned them into rentals.

“Lending is so tight, and even if you do get a loan you’d have to jump through a bunch of hoops first,” Leffel, 44, said. “I like buying with cash, because then I can control my investments.”

Investors like Leffel helped spur all-cash home purchases to a record 43 percent of U.S. deals in the first quarter, more than double the share a year ago, according to data firm RealtyTrac Inc. Cash is keeping residential sales trudging along while mortgage lending plummets, hurt by rising interest rates and stiff credit requirements. Americans seeking a loan to purchase their first dwelling are increasingly shut out.

“The cash buyers today mean that all is not well in the housing market,” said Clifford Rossi, finance professor at the University of Maryland’s Robert H. Smith School of Business. “First-time home buyers should make up 40 percent and we’re not seeing it because of mortgage rules.”

U.S. lenders are cutting jobs as business contracts. They made $226 billion in mortgages in the first quarter, a 17-year low, according to the Mortgage Bankers Association in Washington.

Small Investors

Smaller investors, who deploy cash for homes to rent, flip, or vacation in, are finding better deals now that institutions have pared buying foreclosures, said RealtyTrac Vice President Daren Blomquist. Cash sales are rising from coast to coast, comprising more than half of all purchases in many metropolitan areas in the first quarter.

In the Miami area, 67.1 percent of sales were cash deals; New York posted 57 percent; Detroit recorded 53.5 percent; Atlanta had 53.2 percent, and Las Vegas posted 52.2 percent, according to Irvine, California-based RealtyTrac.

In Manhattan, buyers are using cash for trophy apartments and to gain an advantage over borrowers who must depend on loans to finance a purchase. Pej Barlavi, owner of brokerage Barlavi Realty LLC in Manhattan, said three of his five current clients buying homes prevailed with all-cash offers.

Barlavi said two of them are hedge fund managers who used year-end bonuses to buy the properties: a $2.2 million two-bedroom apartment in Midtown, selling for $150,000 above the asking price; and $1.5 million for a one-bedroom in Tribeca. His client in the second transaction was “nudged higher by a foreign buyer” before being chosen by the seller, Barlavi said.

Foreign Buyers

“In Manhattan, you have foreign buyers coming in and using properties as a second, third, fourth or fifth home and hedging risks in their home countries,” said Chris Mayer, a real estate professor at Columbia University Business School in New York.

Private-equity firms, hedge funds and other institutional investors have spent more than $20 billion to buy as many as 200,000 rental homes in the last two years. They snapped up properties after prices fell as much as 35 percent from the 2006 peak and rental demand rose from the almost 5 million owners who went through foreclosure since 2008.

New York-based Blackstone Group LP (BX), the biggest U.S. single-family home landlord, cut purchases by 70 percent from last year’s peak and is now concentrating on just five markets, Jonathan Gray, global head of real estate, said in a March interview. Blackstone has invested $8.5 billion since April 2012 to amass almost 44,000 rentals in 14 cities.

Strict Credit

American Homes 4 Rent (AMH) and Colony American Homes, the second- and third-ranked U.S. home landlords, have also cut acquisitions as the rebound in prices requires them to raise capital or improve operations.

“As institutional investors pull back their purchasing in many markets across the country, there is still strong demand from other cash buyers, including individual investors, second-home buyers and even owner-occupant buyers,” RealtyTrac’s Blomquist said.

Banks’ stricter credit standards following the housing crash, in combination with rising mortgage rates, have put the brakes on lending. More than 40 percent of borrowers had FICO scores above 760 in 2013 compared with about 25 percent in 2001, according to Goldman Sachs Group Inc. analysts in a Feb. 20 report. The 4.22 percent average rate for a 30-year fixed mortgage on May 6 rose from 3.53 percent a year ago, following the Federal Reserve’s announced plan to taper its bond buying, according to Bankrate.com.

Wells Fargo (WFC)

“The increase in all-cash purchases is partly because rates are higher than they were a year ago, so it’s made buying with a mortgage more expensive on top of home price increases,” said Jed Kolko, chief economist at real-estate information service Trulia Inc. in San Francisco.

At Wells Fargo & Co., the biggest U.S. mortgage provider, home-loan originations plunged to $36 billion in the first quarter after surpassing $100 billion for seven straight quarters ending in June 2013, according to the San Francisco-based bank. Second-ranked JPMorgan Chase & Co.’s $17 billion total in the first quarter fell below the trough in originations made during the housing crash.

First-time buyers in particular are struggling to get home loans. They comprised 30 percent of total existing-home sales in March compared with an average of 35 percent since October 2008, according to the National Association of Realtors.

Without these buyers, existing-home sales are declining. They fell 7.5 percent in March to a seasonally adjusted annual rate of 4.59 million compared with a year earlier, according to NAR. The sales volume in March remained the lowest since July 2012, according to the trade group.

“With fewer first-time buyers, you end up with more all-cash buyers and less trading up in home activity,” said Columbia’s Mayer. “To get that ecosystem working, you need to have first-time homebuyers so the trade-up purchasers can buy bigger homes.”

To contact the reporters on this story: Dan Levy in San Francisco at dlevy13@bloomberg.net; Alexis Leondis in New York at aleondis@bloomberg.net

To contact the editors responsible for this story: Vincent Bielski at vbielski@bloomberg.net; Kara Wetzel at kwetzel@bloomberg.net Rob Urban

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