high interest – Kat Masters http://katmasters.com/ Wed, 13 Apr 2022 10:32:12 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://katmasters.com/wp-content/uploads/2021/06/icon-2021-06-25T173039.237-150x150.png high interest – Kat Masters http://katmasters.com/ 32 32 The Truth About Payday Loans: Exorbitant Annual Interest Rates https://katmasters.com/the-truth-about-payday-loans-exorbitant-annual-interest-rates/ Tue, 15 Mar 2022 11:00:00 +0000 https://katmasters.com/the-truth-about-payday-loans-exorbitant-annual-interest-rates/ When you face an unexpected expense, a payday loan may seem like the ideal solution. Applying is quick and easy, and you can get the money you need in just a few hours. But before you take out a payday loan, be sure to read the fine print. Payday loans come with very high APRs, […]]]>

When you face an unexpected expense, a payday loan may seem like the ideal solution. Applying is quick and easy, and you can get the money you need in just a few hours. But before you take out a payday loan, be sure to read the fine print. Payday loans come with very high APRs, and if you can’t pay them back on time, you’ll end up paying even more fees and interest. So, is a personal loan really worth it?

What are payday loans and how do they work?

A payday loan is a short-term, high-interest loan that is usually due on your next payday. The idea is that you will use the money you borrow to cover unexpected expenses or to tide you over until your next paycheck arrives. Payday loans are also sometimes called cash advance loans or check loans.

Orville L. Bennett of Ipass.Net explains how they work: Let’s say you need to borrow $300 for an emergency expense. You write a post-dated check for $345 (the loan amount plus fees and interest) and date it for your next payday. The lender keeps the check and cashes it on the date you specify, usually two weeks later. If you don’t have enough money in your account to cover the check, you’ll be charged an NSF check fee.

Payday loans are usually due in full on your next payday, but some lenders will let you extend the loan if you can’t afford to pay it off all at once. Just be aware that interest rates and fees will continue to accrue until the loan is paid off.

Ipass identifies payday loans as a loan that can be a useful tool in times of financial emergency, but should only be used as a last resort. Make sure you fully understand the terms and conditions before applying and be ready to repay the loan as soon as possible. Otherwise, you could end up paying a lot more interest and fees than you originally borrowed.

If you’re looking for an alternative to payday loans, consider online personal loans. Personal loans are a great way to consolidate debt, finance major purchases or cover unexpected expenses.

And unlike payday loans, personal loans come with fixed interest rates and payments, so you’ll always know how much you’ll have to pay each month. Plus, you can usually get a personal loan with bad credit. So if you’re struggling to qualify for a traditional bank loan, an online personal loan might be the perfect solution.

The risks associated with payday loans.

As with any type of loan, there are risks associated with payday loans. Here are some things to watch out for:

– Payday loans come with very high APRs, and if you can’t pay them back on time, you’ll end up paying even more fees and interest.

– If you can’t repay the loan on time, you could end up with costly NSF fees.

Payday loans can hurt your credit score if you miss payments or fail to repay the loan.

Payday lenders may try to aggressively collect debts from borrowers, which could lead to harassment and even legal action.

So before taking out a payday loan, make sure you weigh the pros and cons. If you can’t afford to repay the loan in full on your next payday, it’s probably not a good idea to borrow the money. There are other options available, so be sure to explore all of your options before deciding on a payday loan.

If you’re considering taking out a payday loan, be sure to check out our guide to the best payday loans first. We’ll help you find a lender who offers fair interest rates and reasonable repayment terms.

Payday loans aren’t for everyone, but if you need cash fast and have no other options, they can be a helpful way to get through a tough financial situation.

How to avoid high APRs when taking out a personal loan?

When looking for a payday loan, it’s important to compare interest rates and fees from different lenders. Here are a few tips :

– Compare the APRs of different lenders. Payday loans with lower APRs will cost you less interest and fees over the life of the loan.

– Avoid lenders that charge application or origination fees. These fees can add up quickly, so it’s important to find a lender that doesn’t charge them.

– Look for lenders who offer flexible repayment terms. If you can’t afford to repay the loan on your next payday, be sure to inquire about extending the repayment term. Just be aware that this will increase the overall amount of interest you pay.

– Do not accept any loan before having carefully read the terms and conditions. Payday loans can be expensive, so it’s important to know exactly what you’re getting into before signing anything.

If you take these steps, you’ll have a much better chance of finding a payday loan with reasonable interest rates and fees. Remember to always research the best deal before applying for a payday loan. High APRs can quickly drain your bank account, so it’s important to find a lender that offers fair rates and reasonable repayment terms.

Alternatives to payday loans for people who need money fast.

If you need money fast and don’t want to take out a payday loan, there are other options available to you. Here are some alternatives to consider:

– Personal loans: Personal loans generally have lower interest rates than payday loans, so they can be a cheaper option in the long run. And unlike payday loans, personal loans come with fixed interest rates and monthly payments, so you’ll always know how much you’ll have to pay each month.

– Credit Cards: If you have good credit, you may qualify for a low-interest credit card. You can use your credit card to cover unexpected expenses or consolidate debt. Just make sure you make your payments on time and keep your balance under control to avoid high interest rates.

– Payday loan alternatives: There are a number of payday loan alternatives available, including installment loans, cash advance loans, and lines of credit. These options typically have lower interest rates than traditional payday loans, so they can be a cheaper option in the long run.

Before deciding on a payday loan, be sure to explore all of your options. Payday loans can be expensive, so it’s important to find the cheapest way to borrow money. Personal loans, credit cards, and payday loan alternatives are all viable options for people in need of quick cash. Just be sure to compare interest rates and fees before applying for a loan.

Thanks for reading! We hope this article has helped you understand the truth about payday loans and the high APRs associated with them. Payday loans can be expensive, so it’s important to explore all of your options before deciding on one.

Remember that personal loans, credit cards, and payday loan alternatives are all viable options for people who need cash fast. Just be sure to compare interest rates and fees before applying for a loan and research reliable and knowledgeable lenders such as Ipass.Net.

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How to apply for a payday loan https://katmasters.com/how-to-apply-for-a-payday-loan/ Wed, 09 Mar 2022 10:40:56 +0000 https://katmasters.com/how-to-apply-for-a-payday-loan/ Payday loans are high-cost, short-term loans that borrowers typically use to meet financial obligations. These small, short-term loans come with high interest rates and high fees. While payday lenders market their products as quick and easy ways to meet emergency financial needs, the reality is that many consumers find themselves trapped in a cycle of […]]]>

Payday loans are high-cost, short-term loans that borrowers typically use to meet financial obligations. These small, short-term loans come with high interest rates and high fees. While payday lenders market their products as quick and easy ways to meet emergency financial needs, the reality is that many consumers find themselves trapped in a cycle of debt. Many payday loan borrowers are unable to repay their loan, even after getting another payday loan to pay off the first.

This article is going to learn about the right method to apply for payday loans to get maximum benefits.

How do I apply for a payday loan?

Many people with bad credit apply for payday loans to get quick cash. The application process only takes a few minutes, but it’s important that you read the terms and conditions of your agreement carefully before signing on the dotted line.

When applying for a payday loan, there are certain policies you need to be aware of, such as loan renewal policies, rollover rules, and prepayment penalties.
To apply for a payday loan, follow these steps:

Step 1 – Fill in your personal information

When entering your personal information, be sure to use the correct name, address, phone number, date of birth, and social security number. This will ensure lenders can easily verify your identity during the approval process.

Step 2 – Provide proof of income

You will need to provide proof that you are employed or have another source of income. This could be your most recent pay stub, on-demand employment earnings, unemployment benefit statement, pension award letter, or award letter social security disability.

Step 3 – Fill in your bank details

Payday lenders require you to provide them with your bank details so they can easily deposit the funds as soon as possible. Most payday lenders typically deposit funds the next business day after approval; however, some lenders may take up to two days to process your application and deposit your funds.

Step 4 – Accept the fees and terms
Once you have completed your application, review all fees and conditions. If everything is correct, click “submit” or “next” to complete your application. This will send it directly to a lender for review. You should receive an instant response from a lender as to whether you have been approved for the loan.

How to choose a payday lender?

If you’re considering applying for payday loans, it’s important that you only look through reputable loan companies that offer fair interest rates and transparent terms. Here are some tips for choosing a reputable payday lender:
1. A reputable payday lender should not charge upfront fees.
2. A reputable payday lender will not engage in any form of coercion or harassment if you reject their offer to give you a loan.
3. A reputable payday lender should be able to lend you money even if your credit rating is low.
4. A reputable payday lender will never charge hidden fees.
5. Research customer testimonials online to see what other customers are saying about the company’s service, pricing, and convenience.

Conclusion
In conclusion, payday loans are unsecured short term loans that do not require the borrower to provide any form of collateral. However, to successfully apply for these types of loans, you need to be aware of certain policies, such as loan renewal policies and rollover rules. You can also get help from your friends or colleagues who have already applied for payday loans.

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What happens when you can’t repay a payday loan? https://katmasters.com/what-happens-when-you-cant-repay-a-payday-loan/ Wed, 02 Mar 2022 22:14:31 +0000 https://katmasters.com/what-happens-when-you-cant-repay-a-payday-loan/ Most of the time, people get a payday loan because they can’t get quick financing anywhere else. Unfortunately, the financial situation can worsen if the borrower is unable to repay what he owes. Depending on how long it’s been since you received the loan, the lender could threaten to take legal action against you and […]]]>

Most of the time, people get a payday loan because they can’t get quick financing anywhere else. Unfortunately, the financial situation can worsen if the borrower is unable to repay what he owes.

Depending on how long it’s been since you received the loan, the lender could threaten to take legal action against you and garnish your wages. Borrowers in this situation have options that could potentially help them.

What can happen if you don’t repay a payday loan

While every situation may have differences, there are typical consequences when you don’t repay a payday loan on time.

Withdrawals from your bank account

Most lenders repeatedly attempt to withdraw the funds from your bank account, as permitted by the terms of the loan agreement. If transactions are declined by your bank due to insufficient funds, the lender may initiate withdrawals for lower amounts.

Even if the lender collects some of the outstanding balance using this method, you could still face financial hardship if further banking transactions are declined. Plus, bank charges could add up and cost you several hundred dollars in a short period of time.

Collection agencies get involved

You can expect the lender to initiate collection efforts, including repeated calls and letters demanding payment, while continually trying to write your account. The lender could also sell your debt to a collection agency or hire a lawyer to collect what is owed to you.

You may be able to stop collection actions by asking the lender for an extension. Some states have laws that require payday lenders to grant extended payment plans to borrowers upon request. Remember that these extensions often come with additional fees and interest.

Declining credit score

The lender could also report the delinquent account to the credit bureaus once it is turned over to a collection agency. Your credit score will likely drop and the negative mark will remain on your credit report for up to seven years. Therefore, you may find it difficult to obtain competitive financing offers in the future.

You can take steps to start rebuilding your credit score after defaulting on a payday loan. First, review your credit report to identify any other delinquent accounts and update it, as payment history is the most important part of your credit score. You also want to find errors and challenge them quickly.

Also adjust your spending plan to free up funds that you can use to start paying off credit card debt in the near future. You want to do this to lower your credit utilization rate, or the amount of revolving credit you use, because it makes up 30% of your credit score.

Most importantly, keep an eye on your credit report and practice responsible debt management habits over time to give your credit score the best chance of getting stronger over time.

Negotiations with the lender

It’s much cheaper for the lender to collect than to sue you, and selling the balance to a debt collector for pennies on the dollar means the lender will only get a small percentage of what’s owed to them. .

Both circumstances give you the leverage to eventually settle payday loan debt for a fraction of the outstanding balance. Offer an amount you can afford to pay in one lump sum and mention your intention to file for bankruptcy if the lender won’t budge. The lender may be willing to compromise with you since bankruptcy means they may not be able to collect.

Lender lawsuit

If the lender takes you to court, the onus is on them to prove that you owe the debt. Simply ask that they provide the documentation or agreement you signed when taking out the loan. If the debt collector cannot provide this information, the judge will likely dismiss the case. But if the lender proves that you are indebted and obtains a judgment from the courts, you could be ordered to pay or have your wages garnished.

Quick note: If the lender is threatening to throw you in jail, quickly contact your state attorney general’s office to file a complaint.

How to get the money to pay off a payday loan

Instead of ignoring a delinquent payday loan and ruining your credit, consider these options for paying off debt:

  • Apply for a loan between individuals. If your credit score is low, a peer-to-peer loan is worth considering. You will find these loan products in online lending marketplaces that connect potential borrowers with investors looking to lend you funds in exchange for a return. You can usually compare multiple loans with one application, and you’ll usually need to provide proof of income or assets to be approved.
  • Obtain a debt consolidation loan. A debt consolidation loan allows you to consolidate high-interest debt into a single loan product with a lower interest rate. Most debt consolidation loans have a fixed interest rate and you will make equal monthly payments over a set period. The most competitive loan terms are reserved for borrowers with good or excellent credit. Even with less than optimal credit scores, your rate could be lower than what you received with the payday loan.
  • Consider a short-term emergency loan. Credit unions and some community banks typically offer short-term emergency loans as alternatives to payday loans. They are usually available with slightly lower interest rates and for small dollar amounts, capped at $1,000, and may not require a credit check for approval.
  • Register in a debt management plan (DMP). It should be used as a last resort if you have exhausted all your options. DMPs are available through non-profit agencies. A credit counselor will contact the payday lender on your behalf to negotiate a modified repayment plan that suits your budget. You’ll pay the loan principal balance in full, but the downside is that signing up for a DMP could cause other creditors to close your credit card accounts, causing further credit damage.

You can also try talking to friends and family or looking for ways to adjust your finances to cover expenses such as temporarily canceling streaming subscriptions, switching to a lower food budget.

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Access to earned wages boosts productivity https://katmasters.com/access-to-earned-wages-boosts-productivity/ Wed, 23 Feb 2022 06:00:57 +0000 https://katmasters.com/access-to-earned-wages-boosts-productivity/ In a time of pandemic-induced financial and economic hardship, waiting to get paid once a month can be difficult in the face of emergencies, surprise medical bills, and unforeseen expenses. The inability to access earned wages during tough times can also increase the chances of employees resorting to payday loans at high interest rates, further […]]]>

In a time of pandemic-induced financial and economic hardship, waiting to get paid once a month can be difficult in the face of emergencies, surprise medical bills, and unforeseen expenses.

The inability to access earned wages during tough times can also increase the chances of employees resorting to payday loans at high interest rates, further compounding their dire financial situation.

In Spain, salary advance startup Payflow sought to solve this problem for workers by allowing them to access their earned wages “when they want, as many times as they want and receive”. [funds] instantly,” co-founder Avinash Sukhwani told PYMNTS.

“Millions of Spaniards live hand to mouth and only get paid once a month. In an increasingly immediate world, this cannot be a reality,” Sukhwani said, adding that allowing workers instant access to their earned wages several times a month eliminates financial stress, leading to greater productivity for business.

Compared to other companies in the on-demand payment industry, Sukhwani said Payflow, which launched in 2020, sells its product to businesses for a monthly fee with no direct employee charges for the service.

“The workers’ statute recognizes access to wages as a right. It would not be good for the workers to be charged for their rights,” he explained. “They [companies] offer Payflow as a benefit to their employees.

Read more: Barcelona-based Payflow closes $9.1m funding round

And in sectors like hospitality, for example, where companies face major challenges in both recruiting and retaining talent, being able to offer such a free service for staff that improves well-being employee finance is extremely valuable.

“We noticed that our customers [have been able to] hire 27% faster, reduce their turnover by 20% and increase the productivity of their employees by 10% since [using] Payment flow. Happy employees make for happy companies, and our product helps increase employee satisfaction,” he said.

Reach millions of employees

So far, the model has gained popularity among blue-collar workers, who are the most adopted by companies using the platforms.

“In just two years, Payflow has become the regional leader in the earning industry with [more than] 100,000 users and [over] 175 customers, including well-known brands such as Webhelp, Covirán, Aristocrazy and Grosso Napoletano,” Sukhwani said.

The company recently closed a $9.1 million Series A funding round that increased its total funding to nearly $14 million, and with 0% churn and never losing a customer. , Payflow’s point of differentiation is operating in what is proving to be an increasingly competitive space, he noted.

Going forward, the Spanish FinTech plans to grow from a payday advance business to a neobank, growing from more than 100,000 current users to millions of employees in Europe and Latin America.

“In order to achieve this goal, we should significantly expand the user base and launch features that allow employees to do more with their money,” he said, aware of the enormous challenges involved in an ambitious plan. like building a digital bank.

“Many have tried and failed because it is a very complex product to build from all points of view, including financial, operational [and] regulations,” he noted.

But after the success Payflow has enjoyed over the past two years, Sukhwani said the company is not slowing down anytime soon and staying focused on its goals and objectives.

“In 2022, we want to double the workforce and launch two additional products. We plan to continue our international expansion through Latin America and Southern Europe, [starting in Italy and Portugal],” he said.

Register here for daily updates on all of PYMNTS’ Europe, Middle East and Africa (EMEA) coverage.

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NEW PYMNTS DATA: ACCOUNT OPENING AND LOAN SERVICE IN THE DIGITAL ENVIRONMENT

On: Forty-two percent of US consumers are more likely to open accounts with financial institutions that facilitate automatic sharing of their bank details upon sign-up. The PYMNTS study Account opening and loan management in the digital environmentsurveyed 2,300 consumers to explore how FIs can leverage open banking to engage customers and create a better account opening experience.

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Raise to pay $3.3 million for predatory loans https://katmasters.com/raise-to-pay-3-3-million-for-predatory-loans/ Thu, 10 Feb 2022 18:06:22 +0000 https://katmasters.com/raise-to-pay-3-3-million-for-predatory-loans/ Raise credit agreed to pay a minimum of $3.3 million for charging people interest rates above the 24% maximum allowed by Washington, D.C. for loans and lines of credit, according to a declaration of the District of Columbia Attorney General’s Office. Settlement resolves lawsuit deposit by the AG’s office against Elevate in 2020. Elevate is […]]]>

Raise credit agreed to pay a minimum of $3.3 million for charging people interest rates above the 24% maximum allowed by Washington, D.C. for loans and lines of credit, according to a declaration of the District of Columbia Attorney General’s Office.

Settlement resolves lawsuit deposit by the AG’s office against Elevate in 2020. Elevate is not a licensed lender in the district and said its loans were cheaper than payday loans, which are illegal in DC

More than 2,500 customers must repay and more than $300,000 in interest owed to Elevate will be waived. Additionally, the online credit solutions company was ordered to pay a $450,000 fine to the district and is required to end deceptive marketing practices and keep interest rates below the 24% cap.

“This settlement will put money back into the pockets of consumers in the district who have been illegally overcharged. District consumers should be wary of any lender, including so-called FinTech companies, that promises easy money without any financial consequences,” the attorney general said. Karl A. Racine.

“The truth is often buried in the fine print. Interest rates like those involved in this settlement often exceed 100% and have a devastating impact on people who need an honest and legal loan. This resolution is part of my office’s continued focus on protecting DC residents from these predatory lenders,” Racine said.

See also: Advocacy groups call on regulators to ban high-interest FinTech loans

Based in Fort Worth, Texas, and founded in 2014, Elevate provides online credit solutions to unprivileged consumers facing diminished credit options. In Washington, DC, the company offered, provided, managed and advertised two lending products – Rise, with an APR range of 99-149%, and Elastic, ranging from 129-251%.

The public company, which trades on the NYSE under the symbol ELVT, is partnering with two state-chartered banks to create the two types of loans it offers. Elevate, however, controls the loans, bears the risk and retains the majority of the profits, according to the statement from the AG.

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NEW PYMNTS DATA: 70% OF BNPL USERS USE BANK PAYMENT OPTIONS, IF AVAILABLE

On: Seventy percent of BNPL users say they would prefer to use the installment plans offered by their banks – if only they were made available. PYMNTS’ Banking On Buy Now, Pay Later: Installment Payments and the Untapped Opportunity of FIssurveyed over 2,200 US consumers to better understand how consumers view banks as BNPL providers in a sea of ​​BNPL pure-players.

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NOTICE: Small, short-term loans may be processed by mail https://katmasters.com/notice-small-short-term-loans-may-be-processed-by-mail/ Tue, 08 Feb 2022 18:03:48 +0000 https://katmasters.com/notice-small-short-term-loans-may-be-processed-by-mail/ Published on February 8, 2022 at 11:03 am This letter is provided as the author’s opinion/comment. You can submit your own letter to editor@abq.news This story also appeared in the commentary All opinions included were submitted by Albuquerque residents. Payday loans are high interest, short term and based solely on an individual’s salary. Apparently, these […]]]>

This letter is provided as the author’s opinion/comment. You can submit your own letter to editor@abq.news

This story also appeared in the commentary

All opinions included were submitted by Albuquerque residents.

Payday loans are high interest, short term and based solely on an individual’s salary. Apparently, these are small loans made to bridge a time gap or deal with an emergency, like an unexpected car repair. Payday lenders say these loans are needed to help disadvantaged people in dire financial straits. But one Pew Charitable Trusts study found that only 16% of payday loan borrowers used the money for unexpected expenses. A whopping 69% of borrowers used their payday loans for recurring expenses like bills, rent, and food.

According to Seven Pillars Institute for Global Finance and Ethics, payday loans are “a toxic mix of high operational costs and low returns.” A lender has access to your checking account on the day your paycheck is deposited and takes the entire lump sum payment. This is before you can pay other bills or withdraw money. That could leave you shorthanded again, precipitating another high-interest payday loan and another cut to your next paycheck.

Payday lenders claim to serve a segment of the population that does not have access to conventional bank loans or credit cards. Opponents of these practices say it creates financial slavery.

An intermediate solution, as proposed by Seven Pillars, could be to administer payday loans at reasonable rates through a government agency such as the US Post Office.

What do you think?

Yes, USPS!

When I started my “working” years in 1958, the post office had a bank. My first savings account was there. It was almost unanimous among the elders of our community that debt was avoided like the plague. Times have changed, but the essence of life has not changed. The post office should provide basic financial services in every post office. We also had decent wages required by law, with affordable housing, food and clothing available. Hospitals were run by city and county governments and churches, so medical services were affordable. We have degenerated and deteriorated considerably. We need less Wall Street and more New Deal to have a civilized country.

Yes, USPS!

Postal banking is a great way to start revitalizing underserved areas of this country. Post offices are located in many areas avoided by banks and retail outlets. They provide an existing infrastructure that would be impossible to replicate and an opportunity to start rebuilding the inner city and rural economies. Services should include checking and savings accounts; credit and debit cards; loans and internet access. They could partner with credit unions to provide financial services.

No, USPS!

As if that matters considering the lending lobby. We have many credit unions that can help those who need short-term loans. Please keep the USPO out of trouble; they will simply write off bad debts at our expense. Credit unions can help with advice; if they rate the loans at reasonable risk (not 36%), they should be able to make money and pay the loan officers. I don’t know what regulations need to be changed, but personal service with genuine care for people in need of money is important.

USPS is not a bank!

I am responding to your February 4, 2022 post regarding Payday Payout and Seven Pillars’ “middle-of-the-road” solution for the US Post Office to administer payday loans. First of all, I’m a fan of our local post office and the people who deliver our mail and provide the current services to move mail and packages from point A to point B – I have all the respect in the world for them! However, this famous phrase comes to mind from Pillars’ comments, “I’m from the federal government and I’m here to help. President Ronald Reagan called the phrase “the nine most terrifying words in the English language”. A clear statement that government is not always the solution and should probably be considered the last resort when all others fail. The last place the USPS needs to be is in the financial services industry. The United States Postal System (USPS) lost $6.9 billion in fiscal year 2021 and $7.6 billion in 2020 – USPS losses would only get worse as it tries to administer financial services products. When I visit the post office, the workers are often overstaffed, there are long queues, and it’s always a process that I’ve come to accept to endure when I go there. . The burden of providing and/or administering financial services and all the regulations associated with disclosures and the like would be overwhelming for an already overburdened staff. Furthermore, according to a publication known as Government Executive and an article by Eric Katz dated January 14and 2022, the USPS in a 4 post office pilot program in the Washington D.C. area, has provided financial services to only 6 people since September 2021 selling gift cards and reported earning 35, $70 during this period. The financial services industry is clearly not a place where the USPS should be and having the USPS to provide financial services is not the answer and is certainly not a “middle-of-the-road” solution! (This email is from a bank president.)

Yes, period

You asked if we should “administer payday loans at reasonable rates through a government agency like the US Post Office”. –
Yes.

Finance 1.0

I think personal finance should be taught in college and beyond.

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Is San Antonio FloatMe a Safer Alternative to Payday Loans? https://katmasters.com/is-san-antonio-floatme-a-safer-alternative-to-payday-loans/ Mon, 07 Feb 2022 22:56:22 +0000 https://katmasters.com/is-san-antonio-floatme-a-safer-alternative-to-payday-loans/ FloatMe, a San Antonio tech startup that provides cash advances to workers on their next paycheck, said it raised $16.2 million from investors in its most recent fundraising round. Overall, the startup has raised $49.1 million in funding since June 2019, including $25 million in debt funding, according to Crunchbase, which tracks investments in tech […]]]>

FloatMe, a San Antonio tech startup that provides cash advances to workers on their next paycheck, said it raised $16.2 million from investors in its most recent fundraising round.

Overall, the startup has raised $49.1 million in funding since June 2019, including $25 million in debt funding, according to Crunchbase, which tracks investments in tech companies. FloatMe’s new investors include Iowa-based Active Capital and ManchesterStory.

“We’ve been under the radar,” FloatMe co-founder and president Joshua Sanchez said. “The funding is validation that we have grown significantly and allows us to expand.”

However, he declined to say how many customers use the app.

FloatMe, with 60 employees and an office in downtown Soledad Street, is part of a wave of online and mobile cash advance companies gaining traction during the coronavirus pandemic. They compete with payday lenders who sell high-interest loans to largely low-wage workers, a disproportionate share of whom are black and Hispanic.

FloatMe’s service is similar to financial technology, or fintech, offerings from companies such as Moneylion, Earnin and Dave.

Like its biggest rivals, FloatMe says it offers customers payday cash advances, not loans.

Customers pay a monthly fee of $1.99 and can request small advances – no more than $50 – which they repay when their next paychecks hit their bank accounts.

The startup’s terms of service state that users must be US citizens at least 18 years old and have a cell phone and email address. To create an account, customers authorize the company to access their bank account balance and transaction history.

They must also prove that they have received at least $200 in electronic payroll deposits three times before they can apply for advances.

FloatMe CEO Josh Sanchez markets his company as an alternative to payday lenders.

Jessica Phelps

Once approved, users can receive their advances through an automated transfer from the clearing house to their bank accounts in one to three business days. Or they can pay $4 for an “instant” money deposit within eight hours.

Fees for faster access to cash advances have caught the attention of industry watchdogs. Many workers who apply for cash advances are in financial straits and need money fast.

“This type of fee would be voluntary, but really adds up for consumers,” said Yasmin Farahi, senior policy adviser at the Center for Responsible Lending, a North Carolina-based nonprofit policy and research group.

FloatMe users can also receive offers from third-party companies for money management services or products — if they choose, according to the startup.

According to the terms of service: “In all cases, you will need to register to receive these offers from partners, and FloatMe may receive compensation from these partners for referring you to them. FloatMe is not responsible for the products and services offered by these partners.

Payday debt traps

The federal Consumer Financial Protection Bureau describes a payday loan as “a short-term, high-cost loan, typically $500 or less, that is usually due on your next paycheck.” Loans are available in storefronts and online.

If borrowers do not repay their loans on time or at all, lenders can withdraw money from their bank accounts, sometimes resulting in overdraft fees. Payday lenders also sometimes send collection agencies after delinquent borrowers.

Payday loans have long been a big business in Texas.

The Center for Responsible Lending analyzed average annual percentage rates, or APRs, for a $300 loan with 14-day repayment periods in each state. Data shows Texans can pay up to 664% APR — the highest in the nation — because the state has no interest rate caps to protect borrowers.

“Payday loans are marketed as a quick financial fix, but they’re actually a long-term debt trap,” Farahi said. “People will take out a loan thinking it’s a one-time loan to deal with a short-term crisis. But with all the fees and costs, they end up having to take out another loan and another loan.

Like his peers, Sanchez says FloatMe is not a payday lender.

“FloatMe is all about transparency,” he said. “We charge members $1.99 per month to access our personal finance management tools, overdraft alerts and other budget management features. Members can access the floats without having to pay the $1.99. There is no credit check. There is no interest and no hidden fees.

“We do not collect or store sensitive information (personal information),” Sanchez said. “We work with a third party to simply connect a member’s bank account. We do not sell any user data.

The company’s website says it uses Plaid, a California-based financial services company, to connect to customers’ bank accounts.

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Illinois man accuses online tribal lenders of predatory lending https://katmasters.com/illinois-man-accuses-online-tribal-lenders-of-predatory-lending/ Thu, 27 Jan 2022 01:44:00 +0000 https://katmasters.com/illinois-man-accuses-online-tribal-lenders-of-predatory-lending/ By Victoria McKenzie (January 26, 2022, 8:44 PM EST) – An Illinois debtor has filed a class action proposal against a group of online tribal loan companies for allegedly issuing illegal high-interest loans , adding to a trend of similar complaints across the country that accuse unscrupulous lenders of using the tribes as a mere […]]]>
By Victoria McKenzie (January 26, 2022, 8:44 PM EST) – An Illinois debtor has filed a class action proposal against a group of online tribal loan companies for allegedly issuing illegal high-interest loans , adding to a trend of similar complaints across the country that accuse unscrupulous lenders of using the tribes as a mere front to gain immunity from lawsuits.

Joshua Kalkbrenner sued West Side Lending LLC and Wolf River Development Co. in federal court in Illinois on Tuesday, claiming the companies only claimed to be owned and operated by the Menominee Tribe of Wisconsin. But according to Kalkbrenner – as well as other borrowers who have sued tribal lenders in Illinois, Oklahoma, California…

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Personal habits that can increase financial risk https://katmasters.com/personal-habits-that-can-increase-financial-risk/ Fri, 21 Jan 2022 19:30:28 +0000 https://katmasters.com/personal-habits-that-can-increase-financial-risk/ (MENAFN – ValueWalk) When it comes to things that may pose a risk to your finances, certain activities may immediately come to mind. Investing heavily in high-risk stock options, quitting your job without a back-up plan, or habitually making large, unnecessary purchases are all obvious actions that can certainly affect your finances. But what about […]]]>

(MENAFN – ValueWalk)

When it comes to things that may pose a risk to your finances, certain activities may immediately come to mind. Investing heavily in high-risk stock options, quitting your job without a back-up plan, or habitually making large, unnecessary purchases are all obvious actions that can certainly affect your finances.

But what about the things you do in your daily life? Surprisingly, common personal habits can also jeopardize your personal wealth. Some of these habits seemingly have nothing to do with money, but can have a major impact in ways you may not have considered.

Contents Pin up

  • 1. Recreational alcohol use

  • 2. Lack of savings

  • 3. Continuous subscriptions that you do not use

    • 3.1. Focus on the day-to-day

Recreational alcohol consumption

When linking alcohol to financial risk, the obvious route is prosecution or criminal charges for misconduct. One danger that may not be as widely known, however, are the long-term consequences stemming from traumatic brain injury. As alcohol is estimated to be a contributing factor in approximately 50% of all traumatic brain injury incidents, the habit of drinking alcohol can have very real consequences.

Letter 2021 from Seth Klarman: Baupost’s “endless” information hunt

Baupost’s investment process involves “endless” gleaning of facts to help support investment ideas, writes Seth Klarman in his year-end letter to investors. In the letter, a copy of which ValueWalk was able to review, the value investor outlines Baupost Group’s process for identifying ideas and answering the most critical questions about its potential Read more

Brain damage can impact your finances far beyond substantial medical bills. If you have a brain injury that causes permanent damage and renders you unable to work, your income could be a fraction of what you are used to. While disability payments may provide meager relief, these payments can take months to initiate and may require multiple rounds of appeals.

Lack of savings

Spending on a monthly basis at the higher end of your monthly income is fine until an unexpected expense arises. The problem with this is the fact that unexpected expenses will arise at some point. Whether it’s a car repair or water damage in your home due to a burst pipe, costs will arise that cannot be delayed.

Americans have become more aware of having funds set aside for emergencies. However, about 51% have less than three months of spending in savings. When unexpected costs arise, it’s all too easy to fall into the trap of high-interest borrowing. This can take the form of credit cards or payday loans. Unless you drastically adjust your monthly expenses, you run the risk of spending long periods of time recouping interest payments.

Continuing subscriptions that you are not using

It can sometimes be comforting to have the option of using something even if you decide not to. Signing up for that gym membership at the start of the year seems like a step in the right direction for overall health, but it does little good other than drain your bank account if you don’t use it. .

Maybe there was a single TV show that you were excited to watch and signed up for a streaming service. After you finished watching, did you find anything else on this streaming service? Does it appear as a recurring monthly charge on your credit card without being used?

Many services start with an introductory free trial that requires you to enter payment information upfront. This is a savvy business strategy as it is very easy to forget that payment is due after 30-60 days. Even if you remember, you still have to take the time and effort to call or log into your account to cancel. If you don’t regularly check your credit cards and bank accounts for automatic payments, you could be wasting huge amounts of money each month.

Whether you put a cap on subscriptions and other memberships as part of your annual family budget or just check that you’re using the ones you pay for, get into the habit of not throwing away money.

Focus on the day-to-day

Financial difficulties don’t always stem from the fallout of failed business deals or a drop in investment. Much of the success of financial stability comes from daily habits. To avoid unforeseen difficulties in terms of personal wealth, it is better to adopt good habits and not take unnecessary risks.

Updated January 21, 2022 at 11:40 a.m.

MENAFN21012022005205011743ID1103575607

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First Energy Infrastructure Trust – GuruFocus.com https://katmasters.com/first-energy-infrastructure-trust-gurufocus-com/ Thu, 20 Jan 2022 22:03:15 +0000 https://katmasters.com/first-energy-infrastructure-trust-gurufocus-com/ First Trust Energy Infrastructure Fund (the “Fund”) (NYSE: FIF) declared the regular monthly distribution of common shares of the Fund in the amount of $0.0625 per share payable on February 15, 2022 to shareholders of record on February 2 2022 The ex-dividend date is expected to be February 1, 2022. Information on the Fund’s monthly […]]]>

First Trust Energy Infrastructure Fund (the “Fund”) (NYSE: FIF) declared the regular monthly distribution of common shares of the Fund in the amount of $0.0625 per share payable on February 15, 2022 to shareholders of record on February 2 2022 The ex-dividend date is expected to be February 1, 2022. Information on the Fund’s monthly distribution is shown below.

First Trust Energy Infrastructure Fund (FIF):

Breakdown per share:

$0.0625

Distribution rate based on the January 19, 2022 net asset value of $15.70:

4.78%

Distribution rate based on January 19, 2022 closing price of $14.01:

5.35%

The Board of Directors of the Fund has approved a managed distribution policy for the Fund (the “Plan”) based on an exemption received from the Securities and Exchange Commission which permits the Fund to make periodic capital gains distributions term as frequently as monthly each tax year. Under the plan, the Fund intends to continue to pay its recurring monthly distribution of $0.0625 per share which reflects the Fund’s distributable cash flow. Part of this monthly distribution may include long-term capital gains. This may result in a reduction in the required long-term capital gains distribution at the end of the year by distributing long-term capital gains throughout the year. The annual distribution rate is independent of the performance of the Fund over a given period. Accordingly, you should not draw any conclusions about the investment performance of the Fund from the amount of any distribution or the terms of the Plan.

The distribution may consist of net investment income earned by the Fund, net short and long term capital gains and/or tax-deferred return of capital. The tax-deferred return of capital, if any, is primarily due to the tax treatment of cash distributions made by the Master Limited Partnerships (“MLPs”) in which the Fund invests. The final determination of the source of tax status of all 2022 distributions will be made after the end of 2022 and will be provided on Form 1099-DIV.

The Fund is a non-diversified, closed-end investment company that seeks to provide high total return with an emphasis on current distributions to shareholders. The Fund seeks to achieve its investment objectives by investing primarily in securities of companies active in the energy infrastructure sector. These companies primarily include publicly traded MLPs and limited liability companies taxed as partnerships, affiliates of MLPs, YieldCos, pipeline companies, utilities and other companies that derive at least 50% their revenue from operating or providing services in support of infrastructure assets such as pipelines, power transmission, and oil and natural gas storage in the petroleum, natural gas, and power generation (collectively, the “Energy Infrastructure Companies”). To generate additional income, the Fund intends to write (or sell) covered call options on up to 35% of the assets under management held in the Fund’s portfolio.

First Trust Advisors LP (“FTA”) is a federally registered investment adviser and acts as the investment adviser to the Fund. FTA and its affiliate First Trust Portfolios LP (“FTP”), a FINRA-registered broker, are private companies that provide a variety of investment services. FTA has collective assets under management or supervision of approximately $223 billion as of December 31, 2021 through unit investment trusts, exchange-traded funds, closed-end funds, mutual funds and accounts managed separately. FTA is the supervisor of the First Trust unit investment trusts, while FTP is the sponsor. FTP is also a distributor of UCITS units and UCITS creation units. FTA and FTP are based in Wheaton, Illinois.

Energy Income Partners, LLC (“EIP”) acts as the investment sub-advisor to the Fund and provides advisory services to a number of investment companies and partnerships for the purpose of investing in MLPs and other energy infrastructure securities. EIP is one of the first investment advisers specializing in this field. As of December 31, 2021, EIP managed or oversaw approximately $4.6 billion in client assets.

Main risk factors: Past performance is no guarantee of future results. Investment returns and the market value of an investment in the Fund will fluctuate. Stocks, when sold, may be worth more or less than their original cost. There can be no assurance that the Fund’s investment objectives will be achieved. The Fund may not be suitable for all investors.

The securities held by a fund, as well as the shares of a fund itself, are subject to market fluctuations caused by factors such as general economic conditions, political events, regulatory or market developments, changes in interest rates and perceived security price trends. A fund’s shares could lose value or underperform other investments because of the risk of loss associated with these market movements. In addition, local, regional or global events such as war, acts of terrorism, the spread of infectious diseases or other public health issues, recessions or other events could have a material adverse impact on a funds and their investments. Such events may affect certain geographies, countries, sectors and industries more significantly than others. The outbreak of the respiratory disease referred to as COVID-19 in December 2019 caused significant volatility and decline in global financial markets, resulting in losses for investors. While vaccine development has slowed the spread of the virus and allowed “reasonably” normal business activity to resume in the United States, many countries continue to impose containment measures in an attempt to slow the spread. Moreover, there is no guarantee that the vaccines will be effective against emerging variants of the disease.

The Fund is subject to risks, in particular because it is a non-diversified closed-end investment company.

Since the Fund is concentrated in securities issued by energy infrastructure companies, it will be more sensitive to adverse economic or regulatory events affecting this industry, including high interest costs, high debt costs, effects of the economic downturn, excess capacity, increased competition, uncertainties regarding the availability of fuel at reasonable prices, the effects of energy conservation policies and other factors. Investments in securities of MLP involve certain risks different from or in addition to the risks of investing in common stocks. The number of energy-related MLPs has been declining since 2014. The industry is witnessing the consolidation or simplification of corporate structures where the capital sleeve of MLPs is being eliminated. As a result of the foregoing, the Fund’s MLP investments may become less diversified and the Fund may increase its non-MLP investments in accordance with its investment objective and policies. Changes in tax laws or regulations, or future interpretations thereof, could adversely affect the Fund or the MLPs, MLP-related entities and other energy and utility companies in which the Fund invests.

The Fund invests in securities of non-US issuers which are subject to greater volatility than securities of US issuers. Since the Fund invests in non-US securities, you may lose money if the local currency of a non-US market depreciates against the US dollar.

There can be no assurance that part of the distributions paid to holders of common shares of the Fund will consist of tax-efficient eligible dividend income.

To the extent that a fund invests in floating or variable rate bonds which use the London Interbank Offered Rate (“LIBOR”) as its benchmark interest rate, it is subject to LIBOR risk. The UK Financial Conduct Authority, which regulates LIBOR, will cease offering LIBOR as a benchmark rate during a phase-out period beginning immediately after December 31, 2021. The unavailability or replacement of LIBOR may affect the value, liquidity or yield on certain fund investments and may result in costs incurred in closing positions and entering into new transactions. Any potential effects of the transition from LIBOR on the fund or on certain instruments in which the fund invests may be difficult to determine, and may vary depending on various factors, and could result in losses for the fund.

As the writer (seller) of a call option, the Fund renounces, during the term of the option, the possibility of benefiting from increases in the market value of the portfolio security covering the option beyond the sum of the premium and the strike price of the call option, but retains the risk of loss if the price of the underlying security declines. The value of call options written by the Fund may be adversely affected if the option market is reduced or becomes illiquid. There can be no assurance that a liquid market will exist when the Fund seeks to close out an option position.

If short-term interest rates are lower than the Fund’s fixed payment rate on an interest rate swap, the swap will reduce net earnings on common shares. In addition, a default by the counterparty to a swap transaction could also adversely affect the performance of the Common Shares.

The use of leverage may involve additional risks and costs and may magnify the effect of any loss.

The risks linked to an investment in the Fund are specified in the reports to shareholders and other regulatory documents.

The information presented is not intended to constitute an investment recommendation or advice to any particular person. By providing this information, First Trust does not represent itself as giving advice in a fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Finance professionals are responsible for independently assessing investment risks and exercising independent judgment in determining whether investments are appropriate for their clients.

The Fund’s daily closing price on the New York Stock Exchange and net asset value per share and other information can be found at https%3A%2F%2Fwww.ftportfolios.com or by calling 1-800-988- 5891.

See the source version on businesswire.com: https://www.businesswire.com/news/home/20220120005992/en/

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