Leadpile’s Blog

In an effort to help distressed homeowners, Arizona attorney general Terry Goddard is asking mortgage lenders to set up streamlined modification plans for their mortgage customers. This is similar to what Countrywide recently rolled out to their mortgage customers. In addition to AZ, there are 9 other states such as California, Ohio, Illinois, and Texas. According to The Phoenix Business Journal, the lenders these states are approaching are Wells Fargo Home Mortgage, JPMorgan Chase, Morgan Stanley Home Loans, HSBC Finance Corp, Citigroup, and American Home Mortgage Servicing Inc.
I am not sure why all 50 states are not apart of this action, however it seems like a logical way to start putting a dent in what is going on with all the bad loans on the books. I hope we will hear more about this, because this might be one of those occasions where we WANT the government to get involved.

With all the regulations going on with different states, I thought this was an interesting article about the effects banning payday loans had on consumers in NC. According to The Community Financial Services Association (CFSA) website, banning payday loans in the state of NC is affecting consumers. The reality is that most that are trying to get rid of payday loans in these different states, have never needed a payday loan.
Understanding fully what payday loan consumers are going through, does not seem like a reality to those trying to ban them in the different states. Do those that are trying to ban the payday loans understand what taking them away is going to do? Do they understand that some credit cards are a much more expensive option for the consumers? What are some other options available to consumers in place of a short term payday loan? Are they prepared to offer these other alternatives to the consumers, to help them get out of this temporary situation?
In the state of NC, there seems to be some effects with the fact that payday loans were banned there. According to this CFSA article, “In fact, respondents’ answers to the survey clearly show that the elimination of payday loans in North Carolina did nothing about the demand and forced consumers to replace payday loans with costly, less desirable and even dangerous options.” Overall, states with either pending regulations or those states trying to regulate, should maybe look at the overall picture of the payday loan industry. Some don’t CHOOSE to get a payday loan… they might have no other option. Leadpile Lead Exchange understands their are consumers needing a loan to fix a temporary financial situation, and we have the lenders/buyers available to provide that much needed loan to the consumers.

How many of you read the fine print at the bottom of your credit card or loan applications? I know I don’t always do that, and I am learning that maybe we ALL need to pay closer attention to the fine print of agreements we sign. The reason we want to make sure and do this is with a practice called “universal default”. According to Bankrate.com, if you are late to ANYONE (lenders) you have the potential of having your interest rate adjust really high, potentially affecting your payment amounts, and maybe even affect your credit. Bankrate states that the complaints about this happening is increasing because more and more customers are feeling the affects of it. In years past some credit card companies and lenders would not implement this practice. However, with tougher times affecting all businesses, they are resorting to “old” practices such as universal default.
An example of this would be if you had a debt owed to creditor A, and you fell 30 days late on it. Creditor A could call up creditor B to inform them that you fell behind on their debt. Because of what creditor A said, creditor B (who you are currently paying on time) could increase the interest rate you are being charged. This is legal because of the tiny print in your creditor agreement where it talks about universal default. Basically it gives the creditors a right to adjust the interest rate on any of your creditors if you are 30 days or more late on another one. In years past this provision was in loan agreements, but not always enforced.
Word to the wise….. read all the fine print and ask lots of questions before doing any new loans or debts.
Leadile Lead Exchange can help those customers that maybe get in the situation where they get behind on their accounts, because of situations like this.

The paydaypundit.com has an interesting blog post regarding payday loans. Some articles on the internet are talking about payday loans related to predatory lending and college students. This blog made a good point about students not being able to get a payday loan. A payday loan is based on a “payday”, and the only way a person can get a payday loan is to have that loan linked to a “pay day”. How can a student get this type of loan if they do not work, like many other students?
Predatory lending is very much something that can be controlled by the consumer, if they ask a lot of questions and make sure they know what they are doing. Students or not students, payday loans are something many people need, and lenders will not give a loan to someone if they do not have a “pay day”. Leadpile Lead Exchange wants to work with students needing loans, and also payday lenders wanting payday leads. Unfortunately, the two will probably not be a match.

Easy Money, a payday lender with stores in Alabama, recently joined Borrow Smart Alabama – a TV  campaign aimed at encouraging borrowers to use loans wisely.

The title loan and cash advance industry, under fire for high-interest rates, have smartly recommended regulatory oversight which will help to promote legitimacy. Borrow Smart Alabama is comprised of more than 225 cash advance and title lenders in the state who have committed to a Code of Fair Lending.

Smart Move by Payday’s in Alabama.

The signatures are in……. 422,000 consumers in Ohio signed a petition in order to have the payday lending issue on the November ballot. The governor signed in June a law that puts some limitations on the annual percentage rate the payday lenders can charge. The governor capped the APR at 28 percent, and put a limit on the number of loans customers can take to four loans per year.
Based on the petitions submitted, consumers think they should have the right to make their own decisions when it comes to their personal financial matters. Those that signed the petition also think that allowing the restrictions to go through will force businesses to close and 6,000 employees to lose their jobs.
According to paydayfact.org, all Americans should have the choice to make their own decisions about getting a payday loan. High costs to doing the loan or not, consumers in Ohio want to decide on their own if they need these payday loans. Many Americans are in dire need of some quick cash, and to them these payday loans are the temporary fix. We shall see what the final decision is on this matter come the November election.

In a continuing effort to research all the options consumers have available to them, I came across a type of loan that I have never seen before. The newest and latest way for consumers to get cash is by taking out a cash advance from their home. Currently, consumers that are age 65 and older have often looked at the option of doing a reverse mortgage. This is basically the consumer taking out a loan on their home, but the loan not being paid back till after they pass away. However, it appears there might be another option available to them.
Something new that lenders are looking at is offering consumers cash advances on their home. According to The New York Times, “Owners 65 to 85 with good credit who live in homes valued above $400,000 (above $500,000 in New York and California) can receive a payment of up to 15 percent of a home’s equity.” Something like this costs the consumer no closing costs unlike a reverse mortgage. There are certain stipulations the consumer has regarding the sale of the home, however the simplicity seems to be there compared to doing a reverse mortgage or other lending options. Yet is this a logical choice for consumers? Not everyone has a home valued above $400,000 either.

The options that homeowners now have are:
1. Refinancing
2. 2nd mortgage or lines of credit
3. Reverse mortgage
4. Home cash advance
5. Loan modification

and what’s next?…………………………….

Consumers are looking for anything and everything they can do to survive. Does this mean a potential new lead type for Leadpile Lead Exchange? Let’s wait and learn some more about this new option available.

In the last year many mortgage lenders have been closing their doors. Auto lenders are getting “selective” on who they lend to. Payday lenders are getting put under a microscope because of various features of their loans. There is not one consumer that is not somehow being affected by this credit crunch. Is any of this happening because of the side effects of predatory lending?
In recent years, industry regulators have had an eye on every sort of lender in regards to potential predatory lending. According to Payday Loan Industry Blog, predatory loans are those that were given out to consumers with deceit or misleading information. This could be related to the terms of the loan, the type of loan or anything else related to the loan and what is conveyed to the consumer. In addition, predatory lending could be where a lender is taking full advantage of the consumer. Predatory lending is not necessarily because the interest rates are high or the cost of doing the loan is expensive. Some try to refer to payday lending as predatory lending.
Payday loans are a loan that many need for a temporary loan to get through a unforeseen situation that has occurred. These loans are usually about $500 and secured by a person’s paycheck. Payday loans being a part of the predatory lending arena should not necessarily be the case, because consumers are conveyed the rates and the cost of doing the loan. However, if a lender does not do this or misleads the consumer, then that could be considered predatory lending.
The bottom line is no matter what kind of loan you look at taking out, you need to ask a lot of questions. Understand fully the cost of doing the loan. The more you try to find out, the better chance you have of not becoming a victim of predatory lending-it’s everywhere, not just with one type of loan.
Leadpile Lead Exchange works a lot with payday loan leads, refinance leads, auto finance leads and other types of lending leads. However, predatory lending or misleading consumers is not something that we promote in our marketplace.

Matt Burns of Business First of Columbus had a very nice article today on the situation with the Ohio Payday Ballot.

According to Burns,, Ohio officials have finally finalized the ballot language for the Payday Issue.

The Ballot will read:  “Shall Section 3 of H.B. 545 be approved?” A “yes” vote keeps intact the provision of the law, which caps annual interest rates on payday loans at 28 percent, down from 391 percent, while limiting the maximum loan amount to $500, from $800.

A “no” vote, according to the language, sets the maximum loan amount back to $800 and allows payday lenders to levy a total charge on a loan that “substantially exceeds” 28 percent.  According to Burns, the 391 percent annual percentage rate calculation doesn’t appear on the ballot.

It looks like a Payday Group called Ohioans for Financial Freedom have worked to collect signatures to make sure the repeal makes it on the ballot. They called the language “fair and balanced.” According to Burns, Ohioans for Financial Freedom has until the end of the month to collect and submit more than 241,000 valid signatures to ensure a spot on the ballot.

Stay Tuned my friends. Ohio is in the middle of it.

According to MSNBC today the numbers are in and retailers lost money, even though the 100 billion dollars worth of stimulus checks have been mailed out by the government. So where did all that money go?
A little over 1/4 of the Americans who received these checks used it for paying off some credit card bills. Only 11% used the money on discretionary items such as electronic items and travel.
Grocery stores to retail stores were offering discounts to come into their stores, to spend their stimulus money on THEIR products. Some retailers placed radio and television ads with reference to spending their stimulus checks at their stores. They all have reached for a piece of the pie.
It appears the winners were discount retailers such as Walmart, Target and Costco. The loosers, that were unfortunately not able to benefit, were department stores and clothing stores. So maybe it is a good time to go out there to get some REALLY good deals!!!!!
Another area that felt some negative effects of the stimulus checks was the payday loan industry. If consumers are getting checks from the government, then they don’t necessarily need a payday loan. However, everything seems to be headed back in the right direction for payday lenders/lead generators. Leadpile Lead Exchange focuses a lot of the payday vertical, so our heart goes out to all our affiliates that felt any negative effects of the stimulus checks going out.

We all know there are some tough times going on with most Americans. Right now, Leadpile Lead Exchange is experiencing a surge with the payday loan lead type. Not only are publishers wanting to generate the leads, but the advertisers are needing those payday leads. If your not apart of the Leadpile marketplace, take a look at some of the conversions our publishers are receiving.

There are a lot of payday loan leads being generated, and WE want them to be SOLD here!
There are also a lot of payday lenders needing leads, and WE want them to BUY here!

I wanted to see if I could find some true results of what some Americans want with regards to the payday loan industry. So much negative publicity gets published on this industry, however there really is a need for these short term loans for many people.
According to a previous poll done by zogby.com, less than 1% of all those polled, thought that lawmakers should focus on the personal loan industry. A majority support the individual’s right to choose their financing options, and want that freedom of choice in payday loans.
Zogby results showed that a majority (84%) of Ohio state’s consumers were in favor of making their own credit decisions without government interference. Additionally, most wanted the federal or state governments to allow adults to get a payday loan, if that is something they choose to do.
Another part of this particular survey stated 72% of the consumers mentioned that traditional financial institutions like banks and credit unions didn’t offer short-term personal loans. Many consumers see payday loans as something convenient, and fast to get some needed cash between paydays. These payday loans are popular with loan borrowers for the main reason of convenience and quick access to cash without any credit checks.
Paydays loans are a necessity for so many people today. Is this something that should be controlled by legislation? I agree there should be some regulation so consumers are not taken advantage of, however 100% eliminating loans, that no other banks or lenders can provide, is not necessarily the best option for the consumers needing them. Where else can Americans get a short term loan not secured by collateral? Getting quick, fast money is very hard to find without having your credit pulled.
Leadpile Lead Exchange embraces payday leads because there is some belief that this is something that is needed by the consumers. We bring together those that can generate the leads of consumers that are looking for these short term loans, with the lenders that can provide this to them.