Apr 14

By Sheryl Harris – The Plain Dealer

The Consumer Financial Protection Bureau has shut down what it says is a robocall debt collection ring that harassed people into paying millions of dollars they didn’t owe.

The CFPB’s lawsuit says the collectors used bogus names such as “LRS Litigations,” “IRS Equity,” and “Worldwide Requisitions” and threatened consumers with lawsuits or arrest if they didn’t pay up.

LRS Litigations used a 216 number and dogged so many consumers for debts that the Greater Cleveland Better Business Bureau opened a file on the company, even though it couldn’t locate it.

The phantom debt collectors wouldn’t identify the companies the debts were owed to, the suit said, but they were able to convince people the calls were legitimate by ticking off personal information about them, including their Social Security numbers, dates of birth and employers’ names.

In addition to suing the collection companies, the CFPB went after the telemarketing firm that placed the robocalls and the payment processors who took consumers’ credit and debit card payments.

A federal court in Georgia issued a temporary restraining order against the debt collection companies pending further hearings. [read more]

Apr 13

By Ashlee Kieler – Consumerist

While it’s never too late to become financially literate, it certainly helps if you start early. That’s why the Consumer Financial Protection Bureau is launching a national effort to improve financial education in schools.

The new educational initiative centers on a resource guide containing strategies to promote development and implementation of financial education in student coursework.

Although the guide is targeted toward policymakers, the CFBP says it was designed to assist all educators.

Each section of the guide – which begins with laying the groundwork for financial learning, building initiative and extending knowledge – includes case studies and a resource directory. [read more]

Apr 10

By Chloe Della Costa – Cheat Sheet

Credit reports touch many aspects of people’s daily lives, from employment to housing, so accuracy is paramount to American consumers. Prompted by an investigation that started in 2012, New York Attorney General Eric T. Schneiderman recently reached a settlement with Experian, Equifax, and TransUnion, the country’s three leading credit reporting agencies (CRAs). The agreement was settled in March 2015, prompting reforms to better protect consumers, including improved credit report accuracy, a more effective system for reporting and fixing errors, restrictions on reporting debts from payday lenders, and a waiting period for reporting medical debts.

The three credit reporting giants have been criticized for frequent errors in reports, as well as the automated, and largely ineffective, process for correcting those errors. The most important action on the part of consumers is to request a yearly free credit report through AnnualCreditReport.com. This will help consumers catch errors or even instances of fraud as quickly as possible. Thanks to the new agreement, called the National Consumer Assistance Plan, when errors do occur, disputes will now be handled by trained employees.

Another consumer concern addressed in the plan is the treatment of medical debts. Back in August 2014, FICO agreed to discount medical debt from its scores, which was the first piece of good news for impacted consumers. Now with Attorney General Schneiderman’s new settlement, for the first time, CRAs will be required to remove past medical debts after they are paid by an insurer. Mark Rukavina, a longtime consumer advocate and principal of Community Health Advisors, told The New York Times the obligation to remove old debts was “long overdue.” [read more]

Apr 9

By Mark Belcher – WIYB News 4

Business leaders across the country are warning of the dangers in massive student loan debt, which has overtaken credit card debt as the largest debt in the nation.

New York State and federal lawmakers have been inventing new loan forgiveness programs, but for many it’s not enough. Some programs fail to target the heart of the issue, and others don’t reach back to help those who already are suffering, they just aim to help protect those who will graduate in the future.

The National Foundation for Credit Counseling is launching a program which aims at providing full-service counseling for college students and grads struggling under the weight of massive loans. But the Consumer Credit Counseling Service of Buffalo — which is part of the national network — is already offering those services to debt-strapped western New Yorkers. [read more]

Apr 8

By Jason Alderman – The Huffington Post

When a loved one dies, is it possible to inherit their debt?

It’s a serious question for heirs, and particularly for couples who hold debt jointly.

In most cases, a deceased person’s debts fall to their estate for payment. However, depending on state law, shared credit relationships and the amount of debt in question, surviving family members may be shocked to learn that they could be legally liable for remaining debt that they weren’t aware of or had expected their loved one’s estate to cover.

That’s why it’s wise to include debt planning in individualized estate planning as early as possible.

Here are some options and issues to consider when planning ahead:

Be honest about your financial situation. It is not always easy for certain family members to admit they have debt issues, particularly older Americans who had hoped for better financial circumstances at the end of their lives. So parents and their adult children or spouses should fully disclose outstanding debt matters that could affect the borrower’s estate. Spouses should consider requesting and sharing between themselves or other family members their three free annual credit reports from TransUnion, Experian and Equifax as a way to confirm their debt status. [read more]

Apr 7

By Samantha Joseph – Daily Business Review

When it comes to foreclosure lawsuits, good news for the judiciary could spell havoc for property owners.

In the wake of the 2008 housing crash that left South Florida one of the hardest hit regions in the country, courts soon realized how unprepared they were for the crushing caseload that soon choked their dockets.

At the height of the crisis, tens of thousands of new foreclosures flooded the courts each month. In 2009, lenders filed more than 64,000 foreclosure suits in Miami-Dade County alone, and by the end 2010 nearly 82,000 cases were pending in circuit court.

In Broward County, judges juggled about 29,000 new lawsuits in 2010, and the backlog ballooned to more 43,000 pending cases by July 2012.

“There’s been a substantial improvement since the dark days of 2009,” said Miami-Dade Circuit Judge Jennifer Bailey, the civil administrative judge who spearheaded the herculean task of clearing the bottleneck in her circuit.

In the last five years, the court slashed pending foreclosures nearly 80 percent to around 15,000 cases at the end of 2014. From 2009 to 2013, it closed more than 190,000 cases, or an average of about 38,000 annually. Miami-Dade Circuit Court seemed to hit its stride in 2011 when the closure rate outpaced new filings, disposing of more than 42,000 cases as nearly 19,000 new suits hit the docket.

“Getting a case heard is about access,” Bailey said. “By and large, most cases have not had to wait for judicial access since 2010.”

The new system, buoyed by state funding for case managers to perform administrative tasks that once fell to judges, means Miami-Dade foreclosures quickly get to the summary judgment stage. In contrast, some old cases lapped the five-year statute of limitations.

Some critics say that’s not necessarily good news.

Across the region, foreclosure defense attorneys raise challenges to new policies aimed at simply cutting the backlog. [read more]