Category Archives: Attorney

Banks Warn CFPB to Back Off on Scrutiny of Medical Credit Cards

Banks, debt collectors, and other companies said the Consumer Financial Protection Bureau lacks the authority to make specific rules governing medical credit cards and other financial products patients use to help pay health-care bills.

The CFPB, along with the the Treasury Department and the Department of Health and Human Services, in July sent out a request for information on the prevalence of medical payment products in the health-care market, and the potential problems they pose for patients and their families.

But health-care credit cards and other targeted products operate much in the same way as financing products in other sectors, so there’s no need for new rules, trade groups representing banks and debt collection agencies said in comment letters to the CFPB ahead of a deadline last week. Health-care providers groups also warned that overregulating such products could lead to people postponing necessary but expensive procedures… LINK

Watch this space for updates from the CFPB…

Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | 9.19.2023

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

Many Older Adults Plan to Age in Place, But Only 34% Are Confident They Can Afford It (2023 Study)

Key Findings

  • Close to 36% of aging adults would be willing to move for a more affordable cost of living, while 34% say nothing would entice them to leave their current homes.
  • Regarding ambitions to age in place, most adults are concerned about performing day-to-day activities (37%), loneliness (35%) and being able to afford at-home care (27%).
  • Aging in place is easier in some areas than others: Corpus Christi, TX, Spokane, WA, and Amarillo, TX are the top three best cities to age in place.
  • Across the two most popular retirement states, Florida and Arizona, only two cities rank in the top 30 to age in place: Fort Lauderdale, FL (No. 11) and Cape Coral, FL (No. 20).

Staying Independent Is a Top Priority For 48% of Aging Adults

Although research has shown that older adults who live in retirement communities are happier (and often healthier) than those who don’t, the majority still wish to age in place. Why is that?

Source: Many Older Adults Plan to Age in Place, But Only 34% Are Confident They Can Afford It (2023 Study)

Reverse Mortgage Specialist™ James Spray | CO LMO 100008715 | NMLS 257365 |

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

Misconceptions thwart successful retirements | Pacific Coast Business Times

Just The Facts

“…Home equity is the largest asset of American families. Both retirees and their financial advisers may not understand that a reverse mortgage is a retirement strategy. The Home Equity Conversion Mortgage is the Federal Housing Administration’s reverse mortgage program that allows qualified retirees to stay in their own home by withdrawing some of the home equity. My study found that it improved 10 percent of the couples’ households and 9 percent of singles’ households in California. In California, 64 percent of couples’ households and 53 percent of singles’ households are eligible for HECM.”

Source: Misconceptions thwart successful retirements | Pacific Coast Business Times

 

 

Financially Speaking™ James Spray, RMLO | CO LMO 100008715 | NMLS 257365 | February 18, 2020

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct for your situation. This information is not legal advice and is for guidance only. You may reproduce this information in whole and not in part, providing you give full attribution to James Spray.

If my spouse dies or moves to a nursing home, what happens with my reverse mortgage?

If my spouse dies or moves to a nursing home, what happens with my reverse mortgage?

It will depend on whether you and your spouse are co-borrowers on the reverse mortgage loan, and when the loan was made.

Most reverse mortgages are Home Equity Conversion Mortgages (HECMs). The Federal Housing Administration (FHA), a part of the Department of Housing and Urban Development (HUD), insures HECMs. Under the rules governing HECMs, if you live with a spouse, it is a good idea to make your spouse a co-borrower when you apply for a HECM if you both meet the qualifying age of 62. If you are a co-borrower, you can continue living in the home even if your spouse dies or moves out to a nursing home. A surviving co-borrower can also receive money from the loan.

Sometimes, only one of the spouses is listed as a borrower on the loan. For example, one spouse might not have been 62 yet, and would not have been qualified to be a HECM reverse mortgage borrower. In that situation, what happens to a surviving non-borrowing spouse depends the timing of the HECM.

Any HECM loans with case numbers assigned on or after August 4, 2014, allow eligible non-borrowing spouses to remain in the home after the borrower dies if they meet certain initial and ongoing requirements. To qualify as an “eligible non-borrowing spouse,” you must:

https://www.consumerfinance.gov/ask-cfpb/what-happens-with-my-reverse-mortgage-if-my-spouse-dies-en-241/

Financially Speaking™ James Spray, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | May 13, 2019

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only.

Experian ‘Boost’ Adds a New Way to Build/Rebuild Your Credit

“The idea is to help thin-file customers — those who have less experience with credit — by incorporating signs of responsible financial behavior that traditionally aren’t seen by credit reporting bureaus. Boost also may help people who are rebuilding their credit after financial setbacks. Experian estimates the product could affect up to 100 million consumers’ scores.

Consumers who want to use Boost must allow the product to scan their bank account transactions to identify utility and cell phone payments. Information about payments will appear in their Experian credit report and be used when certain credit scores are calculated from that data.

Boost will count only positive payment history, Experian says, so missed utility or cell phone payments will not hurt your score. That’s different from how credit scores usually work, where late or missed payments are recorded in your credit report and can reduce your score.

Consumers can register on Experian’s website to get early access to Boost, and the product will roll out more widely in early 2019, the bureau said in a news release…” http://bit.ly/2V1nq9P.

There is no cost for the consumer.

Image Credit

Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | December 20, 2018

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct for your situation. This information is not legal advice and is for guidance only. You may reproduce this information in whole and not in part, providing you give full attribution to James Spray.

UltraFICO®An Initial Discussion

While this new alternative “credit” algorithm is not set to roll out until sometime in 2019, included below are my initial thoughts based on the BIAA press release and the below referenced articles from the Wall Street Journal, Consumer Affairs and USA Today.

Experian, FICO and Finicity Launch New Ultra FICO Credit Score

With Ultra FICO® Score, a consumer grants permission to contribute information from banking statements, including the length of time accounts have been open, frequency of activity, and evidence of saving, which can be electronically read by Finicity and combined with consumer credit information from Experian to provide an enhanced view of positive financial behavior.

Experian, FICO and Finicity estimate this new score has the potential to improve credit access for the majority of Americans and is particularly relevant for those who fall in the grey area in terms of credit scores (scores in the upper 500s to lower 600s) or fall just below a lender’s score cut-off. Consumers who are relatively new to credit with limited history or those with previous financial distress that are getting back on their feet stand to benefit the most.

This new system will roll out next year. Initially, the most likely use will be for beginner credit cards. The UltraFICO® is an add-on feature some lenders will offer to enhance a prospective borrowers credit profile and score.

The prospect must provide access for a one-time snapshot of their banking/bill paying account. The data analyzed will be regular payments of rent and utilities. The expected average balance in the account should be $400 or more. There should be no overdrafts or NSF checks in recent months. It’s expected there will be more income than outgo to the account. Discussed is that the checking/bill paying account must be established for some undefined time.

The above referenced WSJ article captures the essence of what the new credit score enhancing tool is expected to be. It will not, in the immediate future, be used by mortgage lenders. I expect that it may be used by some auto dealers.

UltraFICO® score takes into account how much money you have in the bank

According to the Journal report, the new UltraFICO® would be a tool for consumers whose credit scores are not that great. If they have a few hundred dollars in the bank and have had the bank account for a number of [undisclosed] years without overdrawing they might see their credit standing rise.

But in practice, the new formula is likely to be of greater benefit to consumers who already have high credit scores because they are the consumers most likely to have accumulated some cash in the bank. Consumers with low credit scores are often in that situation because they lack the extra cash to meet an unexpected expense.

Based on practicality and experience, I believe this Consumer Affairs writer is off-base in his analysis of who this will help the most. Someone with >760 FICO® Scores has no need for a bump of a few points whereas someone with a 620 score most definitely has the need. We’ll soon figure out just how many months one must have $400 or more in their account to gain the bump.

New FICO system could lift credit scores by including checking and savings history

Finally, from the above referenced article from USA Today: “...it remains to be seen how fast lenders will adopt this supplemental scoring system. For instance, FICO’s latest credit score – FICO 9 – was released four years ago, but the previous version of the score – FICO 8 – remains the most widely one used.”

Consider the fact that neither FICO 8 or 9 are used in the mortgage lending industry. UltraFICO® may be used by certain credit card issuers as well as some vehicle lenders. We’ll know more next year.

Video Update 1/16/19

Image attribution

Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | October 30, 2018

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

What Are the Costs of Aging in Place?

According to an AARP study, 90 percent of people age 65 and over would prefer to stay in their own homes as they get older — and not go to a nursing home or assisted living facility.

But if you or your parents are buying, building or renovating a home to accommodate the needs of a loved one, what kind of costs can you expect to incur?

Source: What Are the Costs of Aging in Place?

Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | August 17, 2018

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct for your situation. This information is not legal advice and is for guidance only. You may reproduce this information in whole and not in part, providing you give full attribution to James Spray.

Free Credit/Security Freezes All 3 Bureaus + Free Unfreezing

Thanks to a new federal law – the Economic Growth, Regulatory Relief, and Consumer Protection Act – consumers will be able to contact each of the three major credit reporting agencies and direct them to place a free freeze on the consumer’s credit file. By restricting access, a credit freeze makes it harder for identity thieves to open new accounts in consumers’ names.

Not only will it be free for consumers to freeze their credit, but they can lift that freeze for free, too. And the law requires the credit reporting agencies to do it in a hurry. If a consumer asks for a freeze online or by phone, the credit reporting agency has to put the freeze in place no later than the next business day. If the consumer wants to lift the freeze…that has to happen within an hour.

This new law is effective September 21, 2018. Click here for more.

The New York Times published good article on the subject. “Freezing Credit Will Now Be Free. Here’s Why You Should Go for It.” https://nyti.ms/2Mw01rU

Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | August 16, 2018 | Updated September 16, 2018

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

The State of Lending: Debt Settlement | Center for Responsible Lending

Debt settlement companies offer the promise of settling a consumer’s debt for a fraction of what they owe. The idea is simple: debt settlement companies offer to negotiate down the outstanding debt (usually from credit cards) owed to a more manageable amount so that a consumer can become debt free. Unfortunately debt settlement carries significant risks that may result in consumers becoming even worse off.

Debt settlement is inherently a risky venture: in order to enroll into debt settlement programs, consumers are required to default on their debt which often results in fees, increased interest rates, and sometimes even lawsuits from creditors. Even after assuming all this risk, consumers are offered no guarantees; in fact, some creditors refuse to negotiate with debt settlement companies at all. Even if a settlement is reached, a consumer unable to keep up with the new settlement arrangement risks falling back into default – and now without the fees paid to the debt settlement company for negotiating the agreement. CRL finds that consumers must settle at least two-thirds of the debt they enroll in a debt settlement program to benefit, a result that many will not achieve.

This chapter examines the debt settlement industry, the risks to consumers, and recommends actions at both the federal and state levels to reduce the potential harm to consumers.

The chapter finds:

  • Debt settlement is a risky strategy for debt reduction – and often leaves consumers more financially vulnerable.

  • Consumers must settle two-thirds of their debt to be better off than they were before – and many consumers are unlikely to reach that level of success.

  • Strong state and federal laws could curb risks associated with debt settlement.

Source: The State of Lending: Debt Settlement | Center for Responsible Lending

FHFA, FICO & Political Gibberish = Economic Risk

FHFA on credit score delivery: forgotten lessons

Multiple versions of a credit model may lead to added cost and complexity

  • While FHFA states that new scores provide “only marginal benefits,” they go on to say that there are “compelling reasons” to change. It is not clear how that conclusion is reached.

  • They ask market participants for cost estimates, and state that the GSEs will require 12-18 months to implement changes, but do not provide cost estimates for the Enterprises.

  • They acknowledge that there are risks associated with the proposed changes but do not provide a structure for ameliorating these concerns, or a cost estimate of implementing it.

  • They ignore the potential risks associated with the credit loosening implicit in the new VantageScore model that stem from more relaxed trade line histories and increases to systemic risks associated with its adoption by lightly-regulated nonbanks.

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Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 |April 30, 2018

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct for your situation. This information is not legal advice and is for guidance only. You may reproduce this information in whole and not in part, providing you give full attribution to James Spray.