1. Do you think of an industry out there taking advantage of consumers?
2. Or, do you think about an industry providing people with relief and peace of mind during this financial crisis?

Most people would say answer a.  But is that true or do we need to educate ourselves regarding this part of the financial industry?  Who are the people that need these payday loans and do they have other options?

According to www.census.gov the official poverty rate in 2010 was 15.1 percent, which was up from 14.3 percent in 2009.  In 2010, 46.2 million people were in poverty, which was up from 43.6 million in 2009.

Those are staggering numbers.  People are having a hard time making ends meet. From 2009 to 2010 an additional 2.6 million people were at poverty level.  Where did they come from?  Middle Class families?  Low Income families?   Who is out there helping them get back on their feet?  The banks?  With the foreclosures on homes, the increased account fees, overdraft fees and high credit guidelines… what do you think?

What sort of monthly expenses do all of us face? Rent/Mortgage, utility bills, insurance, car payment, food allowance just to name a few.  If you are running out of money at the end of the month what would you sacrifice?  Your electric bill?  Your rent?  Your car loan?  Or just overdraft your bank account?  All of those choices involve late fees or overdraft fees and may incur being harassed by credit agencies or having your electricity turned off, being kicked out of your home or having your vehicle repossessed.  None of those sound like viable solutions to me.

According to www.wikipedia.org the definition for a payday loan is “a small, short-term loan that is intended to cover a borrower’s expenses until his or her next payday.”   That is truly what a payday loan is there for.  Many times you will hear payday opponents talk about high interest fees, but when you research these fees in comparison to bank charges and late fees of missing necessary payments and/or possible repossessions/foreclosures/losing electricity, going hungry etc. – which sounds better to you?

So before we judge the financial institutions giving payday loans or the people receiving such loans – let’s make sure that we look at the situation from all angles, and form an educated decision.

Ever feel as if there is no end in sight to all those piled up bills? Here are 2 plans that may help you get your finances back on track.

1. Snowball Plan: The snowball plan developed by Dave Ramsey focuses on ranking your accounts by balance amount, smallest to largest. Consumers are encouraged to pay the smallest debt first while continuing to pay the minimum amount on the other accounts. By doing so consumers enjoy the satisfaction of when debt drops off, thus they are more likely to make continuous payments.

2. Negative Emotion: The negative emotion plan urges people to pay bills that generate a negative emotion. For example, Shareef Defrai from Huston used his credit card to rent a car for a friend. No big deal until his friend decided to skip town with the car, now Shareef has $16,000 in debt for a car he doesn’t even have possession of. By paying off these types of accounts first the relief of paying off the debt can be life changing.

Both methods have their pros and cons, do any of you have a special way you pay down your debt?

Hyundai started the trend and now GM and Ford are jumping on the bandwagon. These automakers have rolled out new “job loss” protection plans for those looking to purchase a car. According to The Washington Post, “U.S. automobile sales are barely running above an annualized pace of 9 million this year. By comparison, car companies in recent years have sold 16 million to 17 million vehicles. Analysts say the sharp drop suggests that Americans have grown so reluctant to buy new cars that they are even holding back on replacing vehicles that have been in accidents or no longer run.” GM’s job loss plan would cover up to nine car payments of $500 each for customers who lose their jobs, and Ford is offering payments of up to $700 for 12 months.
I am not sure of the specific details of these plans and what sort of “criteria” they set, however this is a positive for those that were a little reluctant on buying a new car. With a little (or lot) of government help, and these sorts of plans being rolled out, maybe there is some chance the auto industry can get back on it’s feet????? Leadpile Lead Exchange is excited about the possibility that there might be some light at the end of this very loooooooong tunnel.

Interest rates have gone down, and now many are wondering if it is really that time to refinance their home. The answer is YES. Not all situations are ideal to do a refinance, however there are things to look at with regards to entertaining the idea of refinancing your home right now.

According to ABC news, here are some common questions consumers might want to know before trying to refinance their home.

1. How much will a refinance cost?
2. Will a refinance save you money?
3. What kinds of loans are out there?
4. What are some common pitfalls?
5. What is the difference between a loan modification and a refinance?
6. If I have a prepayment penalty, should I still refinance?
7. If everyone wants to refinance, is the lending industry able to handle this rush?

Leadpile Lead Exchange generates a large volume of refinance (homeowner), loan modification, debt and home purchase leads. These are all consumers that are in this process of trying to determine what their best option is. No matter what the decision is, asking questions is key to knowing what is the best option for you and YOUR situation.

Remember those days when you could pick out all the items you want, and then pay for them each week at your local store?  Okay, maybe not everyone did that, but I remember doing this sort of thing when wanting to buy some “big” ticket items.  Those days seem to be back.  Sears announced it is rolling out layaway!  You shop for what you want and then make a small down payment, then you are done.  Layaway is not a common thing these days, however with the economy retailers are doing whatever it is they can do to get consumers in their stores for the holidays

What happened to layaway and why did it pretty much disappear?  According to creditcards.com, the rise in credit cards being issued erased the high demand for layaway.  Now with consumers having maxed out credit cards, delinquent mortgages, and jobs disappearing, retailers are trying to come up with ideas on how to get that limited amount of consumers in THEIR stores.  Other stores that I found offer layaway are:  Burlington Coat Factory, TJ Maxx, and also take a look at elayaway.com, because this website offers a layaway service.
So, why would Leadpile Lead Exchange be writing about “layaway”? As I have stated in previous posts, we see consumers that are in all sorts of financial situations. Seeing stories such as retailers rolling out an old idea in this tough economy, gives me optimism that there is possibly some light at the end of the tunnel. Every little piece will help those consumers and the economy get headed in the right direction!

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Myth:  Payday lenders hide fees and mislead consumers.

Fact:  Just like any other service or loan you obtain, there is a cost to do get that loan or service.  In addition, any payday loan you take out there will be a cost to taking out the loan.  According to the CFSA website, “The cost of a payday advance is fully disclosed to customers on signs in the stores and in disclosure agreements. Moreover, in accordance with the Truth in Lending Act (TILA), the terms of the loan are clearly outlined in the lending agreement. Payday advances involve single, flat fees and there are no hidden charges, balloon payments or accruing interest. CFSA members also provide an educational brochure emphasizing responsible use of the product and offer a free right of rescission should the customer change their mind.”

CFSA also went on to say that in a recent survey 96% of the people were aware of the fees associated with taking out the payday loan.  Just like with any other loan, there are documents presented to the consumer with all the fees of doing the loan in black and white.  Are people sometimes just so anxious to get a loan, that they do not take the time to read the documents they are signing?

Leadpile Lead Exchange wants consumers to read everything before agreeing to take out a payday loan, or any other loan.  Knowledge is power!

10 ways you can potentially save $500:

1. Drive less
*The cost of gas and maintaining a car can be very costly. Use carpooling or public transportation.
2. Buy your own coffee or energy drinks instead of stopping each day
*The cost of a Starbucks coffee is at least $3.00 and energy drinks at your local convenience store are about the same. Buy your own coffee and energy drinks in bulk from the grocery store.
3. Conserve energy at home
*Increase your temperature you keep your home at while not there and also while at home. Adjusting it just a degree or two saves a lot of money in your monthly electrical bill.
4. Do your own landscaping
* Pull your own weeds. It is a nice way to stay active and save a lot of money.
5. Think twice about getting that new pet
* Taking care of a pet requires a lot of time and also money to maintain. This is an added expense that should be done when discretionary income is higher.
6. Consider buying store brand products around the house
* All grocery stores have their own store brand products. Some are better than others. However, trying the different variations will save a whole lot of money.
7. Limit internet, cable, and other media costs you have in your home
* Do we all really need 100s of channels to watch. Most Americans watch the same channels on a regular basis. This can be very costly if you don’t keep it to a minimum.
8. Sign up for any reimbursement plans available at work
*Find out if your employer has any sort of carpool reimbursement, tuition reimbursement and other programs they offer for their employees. This could save a lot of money on things you already do.
9. Eat in
* This is one of the biggest expenses we all incur, and also a place where we can save a lot of money by limiting how much we are eating out.
10. Pay at least minimum payments on credit cards to avoid future credit card fees
*Not paying your minimum payment amount leads to added fees from the credit card company, but is also affects your credit which makes your credit score go down. When you credit score goes down, that causes you to either not be able to get a loan or have to pay more to get the loan.

It is easier said than done with these items, however making a good effort to save here and save there will allow consumers to cut back on their monthly costs.

Leadpile Lead Exchange does not currently generate a lot of foreclosure leads, however if there is a company out there that is truly wanting to help consumers from going through this sort of situation, we are certainly able to look at generating more leads. Matching up consumers with legitimate companies to help them is also our goal.