Leadpile’s Blog

I found this article interesting about payday loans maybe being offered at our nation’s banks. A few of the nation’s largest banks — including Minneapolis-based U.S. Bancorp, Wells Fargo & Co. of San Francisco, and Fifth Third Bancorp of Cincinnati — are now marketing payday loan-type products, with triple-digit interest rates, to their checking account customers. Really it is something that should have happened a while ago, or maybe now this is the perfect time to really give the industry a little better image. We have all discussed the need for these short term loans, however now that our banks will be looking at offering these types of loans, what does that do to the future our payday loans? Is this maybe the beginning of the segway into installment loans? What does something like this really mean?
Leadpile will probably be watching something like this because this could open up some doors on who to work with, but also how is this going to affect the future of the payday loan lead generation business? I think this is a GREAT thing to hear about regarding payday loans! The rest of America is waking up to the need for this sort of short term loan. It’s about time!!!!!!!

In a previous blog post, I discussed the FTC cracking down on those that were making “robocalls” to consumers. These were calls where a computerized message was placed to consumers about things such as car warranties. Well now it is official- The FTC (Fair Trade Commission) has enacted new rules forbidding the prerecorded commercial telemarketing calls to consumers without written permission from the consumer. These calls being eliminated has created a lot more buzz for internet generated leads, because now businesses need to get the most targeted people they can for their buck. A perfect example of this is the car warranty leads. The car warranty industry was very much involved in having these pre recorded calls placed to consumers to drum up business. Now that this is illegal, many advertisers are reaching out to companies like Leadpile for the targeted car warranty leads where the consumer physically opted in for information about a car warranty. Other verticals like debt and repairing your credit are services that were using robo type of calls and will be counting more on people like us to get these targeted consumers.
The ironic thing that just happened to me. I just received a robocall from a lender wanting to try and modify my home loan. Unfortunately, I tried to get a live person on the phone and was unsuccessful. I guess these new FTC rules didn’t scare everyone.

I came across this article about nursing homes providing payday loans to it’s employees and it intrigues me because this just goes to show you that there really are a lot of people that need extra short term cash. Nursing homes offering their employees short term loans might not be the answer to helping those that need help, but the point is that there are people everywhere (working and not) that are looking for some short term help. Regulating nationwide payday lenders to the point that causes places like nursing homes to provide loans really the answer? OR coming up with a solution to help those that need short term cash the answer? There has to be a middle ground where getting short term loans should be easier than having to necessarily go to your employer …right? Nursing homes are for taking care of our elderly AND payday lenders are for taking care of those in need of getting some quick cash. The payday lenders should not be taking care of the elderly and the nursing homes I do not believe should be lending money.

The idea of seeing home prices going up is something all of us continue to wish would come. The housing market appears it might have some positive momentum going on, and we will all need to cross our fingers that this is not too good to be true. There have been home value increase teasers in the past that did not stick, but maybe this is actually going to be the time when we see positive changes continue. According to the S&P/Case-Shiller national index, “Its 20-city index was up 1.4 percent in June compared with May, and up 0.5 percent in May over April – the first incidence of two consecutive monthly gains in more than three years. Eighteen of the 20 markets, including San Francisco, experienced monthly price gains.”
So do we know what is possibly fueling this housing price increase? I would guess that investors out there buying a lot of these homes, that were in foreclosure etc, has helped to create a bidding war on homes. Once you have a high demand and lower supply that creates pricing increase. This is great news for those in the neighborhoods that are hoping to see homes in their area selling for more. This will ultimately help them with their values. How about the government giving a tax credit for those purchasing a home? That has to help, however from what I heard about this program there are some stipulations on this program that eliminate some from getting the tax credit because they make too much. Is that fair? Time will only tell if these two things help to fuel the positive momentum we have going on with our housing market. I think a lot of us are hoping this is the beginning of the end of a struggling housing market. You never really realize how much an impact our housing market has on all sorts of industries, till going through it like we all have.

Some recent laws passed regarding our credit cards are taking effect this Thursday. Currently credit card issuers have an ability to change interest rates on existing balances without any sort of notice. Part of the new law taking effect Thursday will put a restriction on the credit card companies from doing this without a 45 day notice. They can still charge you penalty fees for late payments and over-limit charges, however being able to freely increase the percentage rate (fixed rate percentage) on an already existing balance, will be going away. Any change to our interest rate, late payment fees, over-limit fees or finance charges can still increase, but they have to now give us a 45 day notice. It seems that a lot of credit issuers have recently become very aggressive in even shutting down card holders cards if there was no activity. There is a potential “risk” involved to the credit card issuers, and they are scrambling to get rid of those sorts of consumers. The other thing that we are all witnessing is the credit card issuers reducing balances on our credit cards if they are not being utilized. Once again, this is the credit card issuers reducing their “risk” or potential exposure, however it is very much an inconvenience for many people that want to then utilize their credit cards for a larger purchase.
Reading over anything that comes in the mail from your credit card company is probably the safest thing to do to keep up to date on what is going on with your account. Maybe even utilizing your credit card randomly might even be a good idea if you want to maintain the credit card availability. That sounds a little odd, because the “right” thing to do is really maintain a debt free life and live within your means. The credit card companies are almost indirectly pushing Americans to use their cards… or LOOSE them.

When someone needs some quick cash, most think of getting a payday loan because it is quick and no credit check is required. However, in recent years, credit unions have tried to come up with an alternative to a payday loan, but some seem to be similar in many aspects. Does this mean that our nation’s credit unions will be getting put under a microscope like most payday lenders? The unfortunate thing is that many of these consumers are needing “emergency” money, so places like credit unions are trying to jump in and help out their customers with creating these short term loans. There is certainly a need, or credit unions would not look at creating their own version of a payday loan, but really what is the difference? Is there some way all lenders can come together to create one “short term emergency loan” that can help our nations consumers get out of trouble? Leadpile hopes so, because we really want to continue to be able to generate leads of those that are looking to be connected with someone that can help them. Sounds like the credit unions and the payday lenders have a common goal >> help consumers! Right?

Just a few days I was referencing the new Cash For Clunkers campaign that the government had rolled out recently. However, it appears this seems to be too good to be true. The Associated Press is reporting today that the campaign is being haulted because there could be a lack of funds to support the popularity of this campaign. It does not seem anything is for sure regarding it being canceled, however I am sure we will all get some new news on this in the next couple of days. This campaign actually was lighting a fire in the auto finance industry like many I am sure hoped, but that didn’t last for long!

Leadpile has rolled out a new offer for the payday loan lead type, and we are looking for more traffic!
We are looking for traffic to Green-paydayloan.com through PPC, email marketing, banner or social networking. The top payout is currently at $73.60. If you are a Leadpile publisher and looking to drive traffic to the offer, you can locate the text link in your seller account under the “offers” tab. If by chance Leadpile is not already working with you, we would like to see you join our marketplace and generate payday loan leads as a Leadpile seller/publisher!
As we all know, a lot of consumers are looking for help in their temporary setbacks, so a payday loan is a lot of the time that in-between money that is going to help them in their current situation.

With everything that has happened in the financial market in the last few years, many question if the responsibility falls on the consumer or the lenders (or both)? Is the responsibility of the lender to make sure the customer 100% know what they are signing, or it is the responsibility of the customer to ask questions if they do understand what they are signing? There are advocates on both sides, however the government now feels it needs to step in. NPR is reporting that Congress has drafted legislation that would allow the government to oversee all consumer financial products such as credit cards, mortgage loans and payday loans. This measure would prevent consumers from getting any sort of “loan” that they did not fully understand what they were signing. I am not quit sure how something like this can be regulated, but the government wants to step in and try to protect consumers in these sorts of situations. Many legislatures feel that the past behavior of our banks was that they would shop around till they found a lender that would take on their “unique” client situation. Unfortunately, what this caused was those “unique” consumers to then fall behind on their mortgages because they really can’t afford that mortgage.
No matter what, if you agree with government intervention in our financial market or not, the bottom line is our country needs something to change. The right answer is not always that easy to figure out, however one thing I do know is that to change our financial market there needs to be a combination of many people/groups that need to come together to protect customers…and sometimes protect the lenders (the good ones).

With all the talk about foreclosures and people buried in their credit card debt, we have failed to talk about all those that can not afford health insurance (uninsured) or those that are underinsured. Bankruptcy is easy to think about it being related to someone having to many credit cards, and then something life changing happened that forced someone to not be able to pay their debts. However, a lot of today’s bankruptcies are not necessarily from credit card debt, but from health care bills.
A recent study shows, bankruptcies that were due to medical debt rose 50 percent from 2001 to 2007. Older consumers are the ones getting hit the hardest. The elderly are unfortunately forced to retire prematurely, have not enough insurance to cover all their bills, or simply do not have any insurance. In a previous blog post I had discussed this painful problem, however things have not gotten any better for our elderly.
Part of this study involved a telephone survey. The telephone survey revealed that 41.8 percent of interviewees specifically identified a health problem contributed to their bankruptcy, 54.9 percent cited medical or drug costs, and 37.8 percent blamed income loss due to illness. Overall, 68.8 percent cited at least one of these medical causes. An additional 6.8 percent had recently borrowed money to pay medical bills. Not only is this a potential insurance related issue, but it is an issue regarding bankruptcy and consumers having no other option but to file bankruptcy. What else do they do?
Leadpile works with the bankruptcy lead type, and this is very much a lead type we have a demand for more buyers to help provide this much needed help to the consumers.

Some great insight provided in this survey on paydayloanindustryblog.com. We all think we know the “typical” payday loan customer and what they are looking for, however this survey provides some things all of us that are in the lead generation business should pay attention to. This survey was sponsored by the Canadian Government, but still has some insight that we should maybe pay attention to.

SURVEY RESULTS
User Satisfaction with Payday Loan Lenders
The majority of payday loan users are satisfied with their most recent payday loan experience,
including 49% who are very satisfied. Users are highly satisfied with the rates and terms being
explained to them (82%) but their satisfaction with the cost of the payday loan is substantially lower
(54%).

Motivations for Using Payday Loans
Users cite a range of situations of great need, or emergency situations in general, as their reasons for needing payday loans. The most frequently mentioned reason for needing a payday loan is to pay bills or prevent overdue bills (40%).
When asked for top of mind reasons for choosing a payday loan instead of another form of lending, users say it is a last resort (41%). Convenience factors represent other motivators for obtaining payday loans; for example, that it is easy to apply (12%), faster to get the loan (10%) and the location is convenient (6%). However, when asked to rate the importance of a number of specific aspects of payday loans, users rate speed, ability to borrow a small amount, hours of operation, convenient location, and ease of applying for the loan substantially more important (87-92% important ratings) than being the only place they are confident to apply (61%) or not being approved at other places (44%).

STIGMA
There is a degree of
stigma associated with payday loans, with 25% of users agreeing they would be concerned about
being seen at a payday loan store.
INTERNET PAYDAY LOANS
A low percentage of users obtain their loans through the Internet (3%). Almost all users obtain their loans from a payday loan store, usually somewhat or very close to their home. Most users (82%) have Internet access, at about the same incidence as the general population (84%).

In recent news, Ohio is facing some potential stricter payday loan regulations. New restrictions such as giving consumers at least three months to pay back loans of $1,000 or less, forbidding lenders from getting around the 28 percent interest cap by imposing phony fees, requiring payday lenders to follow some of the federal fair debt collection rules in place for third-party debt collectors, and possibly imposing fines for violations of the law(s). This new bill is being referred to as “HB 209″, however it seems not all legislators are looking to support it.

Let’s see how this new potential legislation pans out. Leadpile will be watching.