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Entries in Payments (10)

Wednesday
Aug082012

Delinquent Mortgage Payments Down to Three-Year Low

Hemera Technologies/Thinkstock(NEW YORK) -- More American homeowners are staying on top of their mortgage payments, according to a new report from TransUnion.

The credit reporting firms says just over one in 20 homeowners -- 5.49 percent -- were at least 60 days behind with their mortgage payments during the spring quarter.  That marks the lowest level in three years.

The number is still well above levels seen before the housing bust, but the report is another sign of improvement this year for the struggling housing market.  

Home prices are now rising in most parts of the country.  Mortgage firm Freddie Mac says second-quarter prices rose nearly five percent compared in the first three months of this year.

Copyright 2012 ABC News Radio

Tuesday
Jul102012

Nationwide Utility Bill Scam Spreads to Midwest

Fuse/Thinkstock(NEW YORK) -- Utility companies in the Midwest are warning customers of an ongoing con that has already affected thousands on the West and East Coast in which a scammer claims households are eligible for an energy credit offered by President Obama to obtain personal information.

The Iowa Utility Association and three utility companies say a scam that falsely claims President Obama, who happens to be in Cedar Rapids on Tuesday, is providing energy credits by applying payments to utility companies with fake accounts provided by the scammers.

Scott Reigstad, a spokesman for Wisconsin Power and Light Company, an Alliant Energy company, said about 100 customers have been scammed since July 5.

"Nationally, the scams have been happening for months, some through social media, text messages, or fliers," he said.

Though many people wouldn't think of providing personal information to strangers on the phone, the scammer's pitch may be more persuasive than you think, especially if they already know the name of your utility company. "These credits that supposedly the president has offered seem fairly attractive to some people," said Mark Douglas, president of the Iowa Utility Association. "Because they offer the chance to reduce a utility bill, people are very willing to release that personal information."

Victims' stories vary, but the goal of the scam is to extract enough personal information from you to initiate identity theft.

"We had people reporting they have received calls from people saying they were utility representatives and they needed banking information now or their power would shut off," said Douglas.

Most of the scammed Alliant customers were contacted by phone through voice recordings or a person and were provided a bank routing number to pay their utility companies. Victims of the scam are instructed to provide their Social Security numbers in some instances, Reigstad said.

About 49 customers of MidAmerican Energy Company, Iowa's largest energy company, according to the firm, have tried to make payments with a non-working routing number used in the scam. Those customers were from cities including Des Moines, Waterloo, Iowa City, Davenport and Rock Island, Ill.

"Payments made using the routing number will not be applied to customers' bills," said Tina Potthoff, media relations manager with MidAmerican. "We are trying to reach out to customers to make sure no one else falls victim to this."

Starting in late June, customers began calling MidAmerican Energy Company to inquire about the non-existent government program.

"We've seen this at other utilities," Potthoff said. "The best possible way to put a stop to this is prevention and education."

The advice from MidAmerican and the other utility companies is to never provide personal information that the utility company should already have. If you're suspicious of someone who calls you and claims to represent your utility company, "hang up on the caller and give us a call so they know we are on the other end of the line," Potthoff said.

"If you're ever in doubt, give us a phone call as soon as possible," she said.

It's unclear where the scam originated, though Potthoff said the utility companies are working with local law enforcement to try to get to the bottom of it.

San Diego Gas & Electric issued an alert to customers warning of the scam on May 15. Pennsylvania Electric Company, PECO, released a warning to customers on June 28. Florida Power & Light Company issued a release last week and said 30,000 customers had tried to use the credit when making a payment.

For about six days in late May to early June, PSE&G, a utility company in New Jersey, noted customers were trying to or did pay their bills with the fake routing number and the payment bounced back because it was not a legitimate way to pay.

Bonnie Sheppard, spokeswoman from PSE&G in New Jersey, said about 10,000 customers tried to pay their bill with the scam "credit."  The company, which serves three-quarters of New Jersey's population, has over 2 million electric customers and nearly 2 million gas customers.

While customers in Iowa have mostly been contacted by telephone, victims have unwittingly encouraged their friends to join in the scheme by social media and word of mouth, said Potthoff of MidAmerican Energy.

"People think they are getting a good deal but they are publicizing a scam," Potthoff said.

Copyright 2012 ABC News Radio

Thursday
May242012

Man Pays Off $114K Student Loan Debt in Cash

Alex Kenjeev(LONDON) -- When Toronto resident Alex Kenjeev realized he was finally in a position to pay off more than $114,000 in student loans, he wanted to make it memorable. He did so by paying his debt all at once—in cash.

His feat went viral when he posted a photo of the receipt for $114,460 (US $111,350) on his Facebook page.

"I thought it would be funny, mind you, not for the world, just for me," he told ABC News. "I didn't expect it to go viral at all."

Kenjeev is the president of O'Leary Ventures, a company that invests in and supports start-ups. The company is owned by Kevin O'Leary, an entrepreneur who appears on ABC's Shark Tank. On the show, business hopefuls pitch their ideas to a panel of successful entrepreneurs, or "sharks," who decide if they will invest in them.

The debt was for Kenjeev's undergraduate degree from McGill University along with debts from law school and an MBA from the University of Toronto.

After finishing school, Kenjeev said he wasn't paying his debt "aggressively." Instead, he was putting most of his money into a software start-up. When he recently sold the "very profitable" start-up, he had enough money to pay the loan in one fell swoop.

He went to his local Royal Bank of Canada and asked to withdraw $114,460. The bank that held the loans was different than where he keeps his money.

"Their initial reaction was they didn't want to do it," he said. "Then they said, 'We can't give you this much.' And I said, 'What do you mean? I deposit my money here with the expectation that I can take it out. Is this not what banks have been doing for hundreds of years?'"

The bank told Kenjeev he would have to pay the transport fees to have the money delivered by armored truck. He asked them to make sure of that and went home.

The next day, he received an email from the bank saying that they could give him the money. He went back and they took him into a small window-less back room where they counted out the money.

"I put it into a grocery bag and walked a couple blocks to the other bank," he said. "I tried to play it cool."

He told the Scotiabank branch that he wanted to make a deposit in the account with a balance of negative $114,460.

When the teller asked how much he wanted to deposit, he said, "'Oh, the same amount that you see there. Here you go.' And I sort of plopped it down on the counter. She didn't want to accept it initially."

After more than an hour, the bank accepted the money and Kenjeev sauntered out debt-free.

"When I walked out of the bank, I was feeling pretty happy," he said. "I spontaneously snapped a photo of the receipt and posted it to my Facebook wall."

People on Facebook began commenting on the image, some congratulating him and others criticizing him for bragging. Someone put the photo on Reddit and it garnered thousands of comments, many of which were critical. Kenjeev said he had no intention of rubbing anything into people's faces.

"I really wasn't thinking about that, to be fair," he said. "It was a milestone moment in your life, when you become debt-free, and not everyone had a receipt, but I did because of the way I did it."

Kenjeev has been keeping busy preparing for O'Leary Ventures to launch their own wine and mortgage companies later this year, but has also been enjoying life as a debt-free man.

"It feels good," he said. "It feels like a weight has been lifted."

In the U.S., some $1 trillion in student loan debt is outstanding.

Copyright 2012 ABC News Radio

Wednesday
Oct262011

Obama Unveils New Student Loan Plan

John Moore/Getty Images(DENVER) -- President Obama formally announced his plan to lower college loan payments Wednesday, telling students in Denver that their education, and their ability to afford it, is essential to the future economic growth of the country.

“College isn't just one of the best investments you can make in your future, it's one of the best investments America can make in our future,” Obama said at the University of Colorado in Denver. “We want you in school.  But we shouldn't saddle you with debt when you're starting off.”

The new initiative would allow student borrowers to cap their loan repayments at 10 percent of their discretionary income starting next year, two years earlier than previously expected. The plan would also help students consolidate their loans at lower interest rates.

According to the president, the changes would help 1.6 million students lower their monthly payments by hundreds of dollars.

The president’s new student loan plan is part of a series of executive actions that he is taking to boost the economy while circumventing Republican lawmakers, who have blocked his $447 billion jobs bill in Congress.

“I intend to do everything in my power right now to act on behalf of the American people with or without Congress. We can't wait for Congress to do its job.  So where they won't act, I will,” Obama said.

The president’s speech Wednesday wrapped up his three-day Western trip, which also included stops in Nevada and California. In addition to promoting his “we won’t wait” campaign and announcing executive actions, the president also raised some serious campaign cash during the trip, delivering remarks at six campaign events.

Copyright 2011 ABC News Radio

Wednesday
Sep072011

Administration Makes 11th Hour Effort to Rescue Postal Service

PAUL J. RICHARDS/AFP/Getty Images(WASHINGTON) -- Can the White House make a special delivery to save the U.S. Postal Service?

To rescue the agency, it will take a 90-day extension by Congress on a $5.5 billion bill owed by the Postal Service in mandatory annual retirement payments -- the root of its financial woes.

If there's a grace period granted, the White House says it will craft a financial rescue plan to save the agency, which is threatening to shut down by the winter because of record shortfalls and a dwindling revenue stream.

Office of Personnel Management Director John Berry told a Senate panel Tuesday that three months will give officials enough time "to carefully work through the details of a proposal."

Postmaster General Patrick R. Donahoe painted a dire picture of the Postal Service's situation, explaining that it could lose as much as $10 billion and have just over a week's worth of money to pay salaries and expenses when the fiscal year ends on Sept. 30.

Sen. Joe Lieberman, an independent from Connecticut, said that the economy can ill-afford the Postal Service going broke and shutting down.  Meanwhile, Maine Republican Sen. Susan Collins chastised the administration for waiting until now to try and come up with a plan to rescue the post office.

Copyright 2011 ABC News Radio

Tuesday
Aug162011

Late Payments on Credit Cards Fall to 17-Year Low

George Doyle/Thinkstock(CHICAGO, Ill.) -- Politicians in Washington may have a hard time figuring out how to handle the nation's debt, but it appears -- as individuals -- the nation is getting a grip on personal debt.

According to TransUnion, late payments on credit cards are down to the lowest level in 17 years, even though their use has increased. 

The credit reporting agency says the national credit card delinquency rate, which accounts for borrowers being 90 days or more past due, fell to 0.6 percent in the second quarter of this year.  That's the six straight quarter the rate has dropped.

While banks have tightened standards for approving credit cards, TransUnion says people are treating their debts more seriously and paying them off more quickly.

"National credit card delinquency rates have fallen to levels not seen since 1994 as consumers continue to tighten their spending," said Ezra Becker, vice president of research and consulting in TransUnion's financial services business unit.  "TransUnion believes that the recovering economy is only indirectly impacting delinquency rates.  More important and impactful to the decline in bank card delinquency are that consumers are using credit cards more responsibly; a large number of delinquent accounts have moved to charge-off status; and lenders remain conservative in their underwriting."

Copyright 2011 ABC News radio

Tuesday
Jun212011

Bank of America Raising Penalty Rate for Late Payments

ABC News(NEW YORK) -- It's never been more important to pay your credit card bills on time.

Being just one day late on your payments can be very expensive and now, it could even be costlier.  Bank of America is expected to raise its maximum penalty rate this week -- a move that is becoming part of a trend.

Explaining Bank of America's new policy, Adam Levin with Credit.com says, "If you're more than one day late on a payment they have the option, if they want to, to raise your rate to 29.99 percent as a penalty rate."

The hiked up penalty rate would apply to future purchases, not on what you already owe.

If you want to avoid paying more, switch your credit card account to another bank.

"You can also go to credit unions and smaller banks.  So it's not like you don't have options," Levin says.

Copyright 2011 ABC News Radio

Monday
Jun132011

Debt Collectors Seek to 'Friend' Delinquents

Comstock/Thinkstock(WASHINGTON) -- Seeking to catch up with changing technology, the nation's debt collectors want the laws changed to allow them to reach out and touch delinquents by email, cellphone and text messages.

On Monday, the Association of Credit and Collections Professionals introduced a blueprint for modernizing debt collections. Their goal: to increase collections by finding more ways to contact their targets.

The trade group wants to change laws including the Fair Debt Collection Practices Act and the Telephone Consumer Protection Act, which were written before the age of robo-dialers, texts, Facebook and wide use of cellphones. Collectors use these methods to contact consumers now, but they may open themselves up to fines and sanctions under current laws.

In 2010, the Federal Trade Commission saw complaints against collection agencies rise to more than 108,000, a sharp increase from the 69,000 consumer complaints.

Last year, 21 percent of complaints filed with the FTC claimed that debt collectors used third parties for location information. It's one tactic that has driven consumer complaints to a high.

"I don't believe harassment drives any more return on collections than treating a consumer respectfully," says Mark Schiffman, ACA, director of public affairs.

"Posting anything on someone's Facebook wall is a violation, and talking to someone [that is not the debtor] on Facebook violates the third-party disclosure,” Schiffman said. “Neither one is acceptable. It is unacceptable in any circumstance."

"Debt collectors can use social media just like they might use the yellow pages to find information about somebody," says Schiffman. "They can't do anything misleading. They can't friend people using fake identities. They can't post on your Facebook wall."

Copyright 2011 ABC News Radio

Wednesday
Mar162011

Keep Tabs on Spending Using Your Smart Phone

Jupiterimages/Thinkstock(NEW YORK) -- The number of Americans who do their banking online has more than doubled in the past five years and now, many people are banking with their smart phones.

One of the best ways to control your spending is to know exactly what's in your account and smart phones can make mobile banking easy.

"As you're out and you're shopping and you're buying and you're paying for things you've got a better understanding of how much money you've got," says technology executive, Mike Upton at Bank of America.

Upton adds that people can also check their balances and schedule bill payments using their phones.

Moreover, at a growing number of gas stations, convenience stores and fast food restaurants, customers can now pay with their phones by simply waving it at the cash register.

"You wouldn't have to use the card, you could just use the phone," says Upton.

Copyright 2011 ABC News Radio

Thursday
Oct282010

Americans Concerned about Making Housing Payments

Photo Courtesy - Getty Images(WASHINGTON) -- A majority of Americans say they are concerned about making their mortgage or rental payments, according to a new Washington Post poll.

Fifty-three percent of those polled said they are "very concerned" or "somewhat concerned" about making their monthly payment.

The results show concerns over housing payments have spiked since 2008, despite improvements in the overall economy. In December 2008, 37 percent were either “very” or “somewhat concerned” about making payments on time. 

Copyright 2010 ABC News Radio







ABC News Radio