Banking

Senate bank bill could allow 'too big to fail' banks to grow even bigger

Bob Cesca Nov 30th 2009 @ 5:30PM EST Filed Under: Banks, Borrowing

The chain grocery store where my wife and I shop has a bank in it. There's the frozen food section, the bakery section, the pharmacy and ... the bank. It's not even a particularly large grocery store, but there it is. A bank. With a vault, a sit-down area and everything.

I'm not sure how common this is, but it certainly represents the trend here which appears to be rapidly nearing a ratio of more banks than people. Or at least, more banks than McDonalds, Subways, Starbucks, Walmarts and Targets -- combined. That's not an exaggeration. Within short walking distance of my very suburban neighborhood, there are four banks not including the one in the grocery store. Two of those banks are directly across the street from each other.

And, by the way, there are fewer community banks and credit unions here.

With that in mind, I had no idea that there were local laws regulating how many branches a bank can open in a particular states. Oh, and, according to Ryan Grim, Congress and the Treasury Department is trying really hard to undermine those laws.

Continue reading Senate bank bill could allow 'too big to fail' banks to grow even bigger

Overdraft fees ruled legal in England

Geoff Williams Nov 30th 2009 @ 2:30PM EST Filed Under: Banks

It's probably not something that most Americans are following, but in England, the Supreme Court has been studying the legality of bank overdraft fees and whether the public should be refunded, and their verdict is in: the overdraft fees that have been soaking the British are legal.

Two courts had previously indicated that English banks might have to refund their fees, and I admit the thought made me rather gleeful, and last September in a WalletPop post, I started wondering if some similar lawsuit might make its way through the American courts. Why not? We borrowed The Office from England, and it's worked out so well here. Maybe we could take a real scenario in England and help us over on the other side of the Atlantic.

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Mortgage modifications, take two: Obama tries a bigger stick to make banks lower loan payments

Charles Feldman Nov 29th 2009 @ 10:00PM EST Filed Under: Banks, Real Estate, Mortgages

You know that old saying about how in life there are no second acts? Perhaps not. But that doesn't apply to government work.

On Monday, the Obama administration is set to try one more time to get mortgage companies to reduce payments in an effort to bring a halt to ever-mounting foreclosures.

The first effort was a huge flop: Of the half million or so loan modifications made since the first push was on, only about 2,000 became permanent, according to a Congressional oversight panel.

In an interview with the New York Times, Michael Barr, the Treasury Department's assistant secretary for financial institutions said, " The banks are not doing a good enough job ... some of the firms ought to be embarrassed, and they will be."

Continue reading Mortgage modifications, take two: Obama tries a bigger stick to make banks lower loan payments

Five words to never to say to your lender

Lita Epstein Nov 27th 2009 @ 6:00AM EST Filed Under: Banks, Credit, Debt, Fraud, Recession, Credit cards

Getting a loan can be a difficult task in this economic environment. Many lenders won't even consider an application for a mortgage unless your credit score is above 740. Others will consider an application, but zap you with an outrageous interest rate.

Even if you have excellent credit, there are still some phrases you should never say when trying to get a loan. For example:

1. DESPERATE

One of the worst things you can say to a loan officer is that you desperately need the money, then ask how can you speed up the loan process. That's putting a big red flag in front of the loan officer. He'll wonder what the emergency is and is more likely to decline your application.

Continue reading Five words to never to say to your lender

ING bank offers Black Friday deals

Martha C. White Nov 25th 2009 @ 1:30PM EST Filed Under: Banks, Saving Money, Black Friday, Banking-checking-account, Banking-savings-account

The down side of saving a big chunk of change on Black Friday is that you usually have to spend a lot of money to realize those savings. That's why we at Walletpop were happy to see a Black Friday deal that is literally just about the savings.

On Black Friday, online bank ING Direct will announce special interest rates for opening a CD or the brand's signature Electric Orange checking account (they're keeping mum on the details of those rates until Friday but have added a teaser page to their Web site).

This blog has details of two other promotions, though: a $683 discount off an ING mortgage (the amount is the average dollar cost Americans spend on holiday gifts annually, according to the National Retail Federation) as well as a Cyber Monday 20% discount on trades through ShareBuilder, its trading subsidiary.

Continue reading ING bank offers Black Friday deals

552 banks are currently at risk for shutting down

Geoff Williams Nov 24th 2009 @ 4:30PM EST Filed Under: Banks

Could your bank fail? There's still a chance, but if you study the numbers, the odds are still highly in your favor that your financial institution will be sticking around.

Earlier this week, the Federal Deposit Insurance Corp. came out with its third-quarter report, stating that the number of troubled banks has climbed to 552.

The report reveals the health of the banking system as of late September. The current total of troubled banks is up from 416 at the end of June, and 305 at the end of March.

Continue reading 552 banks are currently at risk for shutting down

Low interest rates good for borrowers, bad for savers

Martha C. White Nov 23rd 2009 @ 5:30PM EST Filed Under: Banks, Banking-savings-account

Americans are saving more of their earnings than they have in years, and that's a good thing. But unfortunately, we're not being rewarded for it the way we were in flusher years.

By now, everyone has heard about the government's unprecedented actions to drop interest rates to historic lows so cash-strapped individuals, businesses and banks can borrow on more forgiving terms. The down side of this is that bank account holders are now getting rock-bottom interest returns on their money.

Currently, we're saving around 3% of our collective income. That's not really an achievement to be proud of -- not yet, anyway --- but it's still a great step up from where we were a couple of years ago when the U.S. had a negative savings rate, meaning that we as a nation were literally spending more than we made.

Continue reading Low interest rates good for borrowers, bad for savers

If you can't afford mortgage, don't borrow to send kid to college

Zac Bissonnette Nov 23rd 2009 @ 4:30PM EST Filed Under: Banks, Borrowing, College

When I can't think of anything else to write about, I sometimes like to pick up a copy of US News & World Report's America's Best Colleges, and spend about 30 seconds flipping through to find one piece of really, really, really horrible advice.

And so here it is, from an article by Kim Clark:

The federally backed parent PLUS loan can cover the student's entire cost of college (less any other financial aid). But PLUS loans can cost as much as 8.5 percent a year plus a fee of 4 percent of the loan amount, for a total annual percentage rate of as much as 9.4 percent. Shoppers can find discounts, however. Those who borrow directly from the federal government and make automatic electronic payments are charged just 7.65 percent in interest. (After fees, the APR totals 8.55 percent.) And the eligibility criteria are comparatively forgiving, even for parents who are a little behind on their mortgages.

Continue reading If you can't afford mortgage, don't borrow to send kid to college

Personal checks poised to be a relic

Geoff Williams Nov 23rd 2009 @ 3:30PM EST Filed Under: Banks, Technology, Banking-checking-account

Is the personal check on its way out?

The Dallas Morning News recently suggested that -- and, no, they aren't the first to suggest it, nor will they be the last -- but they point out that several stores lately have made it their policy to refuse personal paper checks: Diesel, True Religion, Ed Hardy and Lululemon Athletica, which are all clothing stores. And maybe there's something in the water, since the clothing giant Gap is also exploring the concept of no longer accepting personal checks.

My WalletPop colleague Martha C. White has also written about Whole Foods no longer accepting checks in some stores, as part of a get-rid-of-checks experiment.

Continue reading Personal checks poised to be a relic

Scam busters turn the tables on those running the Nigerian scam

Marc Acito Nov 23rd 2009 @ 2:00PM EST Filed Under: Banks, Fraud, Recession, Recession Diaries

Beloved One,

I have the Courage to Crave Indulgence for this most opportune business venture...

Look familiar? A day doesn't go by day that I don't receive an e-mail from people with names like Dr. Fortunate Goodpence or Mrs. Pius Motubo soliciting my aid in recovering millions from banks in Nigeria, if only I just sent a little money to get started. Which means I greet each morning with the same thought: who still falls for this crap?

Modern advance-fee scams, commonly called 419 scams after the number of the Nigerian Criminal Code, have been around for over twenty-five years, but exploded with the growth of the internet. So you'd think we'd all be wise to them, yet the latest statistics available show that worldwide losses to these kind of scams topped $4.3 billion in 2007 - and those were just the ones reported. Because, let's face it, losing money due to greed and a sense of colonial superiority to Africans is super embarrassing.

Continue reading Scam busters turn the tables on those running the Nigerian scam

How to find a small bank or credit union

Martha C. White Nov 20th 2009 @ 8:00AM EST Filed Under: Banks, Saving Money

When we wrote about sneaky bank practices, a lot of readers wrote in suggesting that fee-weary customers ditch the big bailout-recipient banks in favor of small community banks or credit unions. In fact, many professional personal finance advisers say exactly the same thing, so WalletPop talked to a few of them to get their recommendations and advice for how to go about finding one of these friendlier financial institutions.

First, you'll need to find a place. While finding a bank can be as easy as driving down your local main street or commercial district, finding a credit union can take a little more sleuthing. Since credit unions are membership organizations, you need to find out which ones you are eligible to join, says David Beck, director of policy at Center for Community Self Help, an organization which includes the Self Help Credit Union and the Center for Responsible Lending.

In many cases, this may be as simple as living or working in an area that is home to a particular credit union, but being a current or former member of the military, many trade unions, religious communities and educational institutions may also qualify you for credit union membership.

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Fewer Americans using credit cards for the holidays

Martha C. White Nov 18th 2009 @ 10:00AM EST Filed Under: Banks, Budgets, Shopping, Credit cards

In yet another sign that Americans are still cautious -- and growing more so -- about their spending, new research shows that fewer of us will be using credit cards to make our holiday purchases this year.

According to a survey conducted by BIGresearch for the National Retail Federation (as reported here by Reuters), the number of consumers using credit cards for holiday purchases will drop more than 10% this year. Only 28.3% of shoppers say they'll use credit cards to buy presents, down from 31.5% last year.

What are we doing instead? Paying cash. The number of survey respondents who said they'll be using cash to buy holiday gift this year rose by almost exactly the same percentage as the drop in credit-card users, at 9.1%. This is a step in the right direction for consumers, as more of us are making a conscious decision to live within our means.

It's bad news for the already-beleaguered credit-card industry, though; we've recently written about new data showing that credit-card companies will probably have many more defaults next year.

It's also bad news for the nation's retailers, which are already bracing for a weak holiday shopping season. The National Retail Federation survey also revealed that we're buying more practical gifts this year. A greater percentage of consumers plan to buy clothing this year, and fewer are buying electronics and jewelry.

Continue reading Fewer Americans using credit cards for the holidays

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