CONSUMER FINANCIAL PROTECTION BUREAU ISSUES REQUEST FOR INFORMATION ON CONSUMER COMPLAINT REPORTING

This is from the cfpb press release:

“WASHINGTON, D.C. — The Consumer Financial Protection Bureau (Bureau) today issued a Request for Information (RFI) about the Bureau’s public reporting of consumer complaints. The Bureau is seeking comments and information from interested parties on the usefulness of complaint reporting and analysis, as well as specific suggestions or best practices for complaint reporting. This is the sixth in a series of RFIs announced as part of Acting Director Mick Mulvaney’s call for evidence to ensure the Bureau is fulfilling its proper and appropriate functions to best protect consumers. This RFI will provide an opportunity for the public to submit feedback and suggest ways to improve outcomes for both consumers and covered entities. The next RFI in the series will address the Bureau’s rulemaking processes, and will be issued next week.

The RFI on complaint reporting is available at:https://files.consumerfinance.gov/f/documents/cfpb_rfi_complaint-reporting_032018.pdf

The CFPB will begin accepting comments once the RFI is printed in the Federal Register, which is expected to occur on March 7. The RFI will be open for comment for 90 days.

The Bureau anticipates issuing RFIs on the following topics in the coming weeks:

  • Rulemaking Processes
  • Bureau Adopted Rules
  • Inherited Rules
  • Guidance and Implementation Support
  • Consumer Education
  • Consumer Inquiries

More information about the call for evidence is available at: http://www.consumerfinance.gov/policy-compliance/notice-opportunities-comment/open-notices/call-for-evidence/

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The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by regularly identifying and addressing outdated, unnecessary, or unduly burdensome regulations; by making rules more effective; by consistently enforcing federal consumer financial law; and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.”

How to turn unwanted gift cards something more desirable

Now that the holidays are officially over and the post-holiday returns and shopping are concluded, I am at a loss for what to do with those gift cards to stores that I do not shop at. Aside from just regifting the card, there are other options available. You may sell your gift card to others in exchange for cash or other gift cards through online gift card exchanges.

  1. Sell It

Fortunately, some companies have made a business model out of buying your unwanted gift cards. Cardpool is a website that buys and sells gift cards. According to the Washington Post, Cardpool purchases gift cards by check or Amazon egift card from $0.75-$0.90 per dollar depending on the popularity of the store associated with the gift card.

2. Exchange It

Now, you may just trade cards with friends, the way people used to trade collectible cards (like baseball and Pokémon cards). However, the cards available for trade may not be what you are looking for.

In a, somewhat, riskier option, you may join a gift card exchange, like the one found on reddit. The risks may seem obvious: you send the gift card and do not get your gift card. However, the way reddit structures the trades, it appears they have a high success rate. Through the use of a review system, experienced traders appear with higher reviews and higher numbers of trades associated with their account. While there may be difficulty in getting your first few trades completed, once you get started, it can be a convenient location to exchange your gift card for the exact payment type you desire.

3. What is my gift card worth?

So you decide to sell or exchange the gift card for your unique store’s gift card, say the Sockmarket, how much is that card worth compared to an Amazon gift card?

Again, there are resources out there which tell the going rates for these gift cards. Cardpool will tell you a rate compared to cash, but the reddit exchange does not have a stock-market-like screen with all the gift card values on them. Gift exchanges are considered free-markets, so you may post your gift card and what you may want, say 80% Amazon in exchange for your $50 sock market gift card, which would mean you trade your $50 gift card for $40 Amazon gift card. All you need to do is wait for a message from someone interested or a counteroffer.

It would be a good idea to check the sale sites before the exchanges because it can give a price floor for your gift card. Why take the risk of the exchange if you can get the same price from a retailer, which buys gift cards for cash. After all, cash is always king!

4. Philanthropic Alternative

If this all sounds like too much effort for a gift card you just want out of your house, but you feel bad for throwing away something that is essentially money.

Good News! You can donate your gift cards to a charity of your choice. On websites like CharityChoice, you may send the balance of your gift card to a charity of your choice. Not only do you get to help your favorite charity, you get a tax receipt!

5. Take Action

Now you know some of the good options available to you! There is no longer an excuse to let those unused gift cards pile up and expire, and yes, gift cards expire!

Missouri’s Lemon Law: Protecting Drivers From Sour Warranty Deals

What is the purpose of Missouri’s Lemon Law and who does it protect?

The Missouri New Vehicles Warranty Law, more commonly known as the “Lemon Law,” protects buyers of new vehicles by enforcing the manufacturer’s express warranty. Missouri’s Lemon Law does not apply to used cars, motorcycles, mo-peds, and off-road vehicles. Rather, the law covers all new vehicles sold or leased with warranty provisions.

Consumers who are protected under Missouri’s Lemon Law include: (1) the purchaser of a new motor vehicle primarily used for personal or household purposes; (2) any person to whom the new motor vehicle is transferred for the same purposes during the duration of an express warranty applicable to the new motor vehicle; and (3) any other person entitled by the terms of the warranty to enforce its obligations. For more information, click here.

I am covered by Missouri’s Lemon Law and my new vehicle has a defect. What is my next step?

Report it to the manufacturer as soon as possible! Under Missouri’s Lemon Law, owners of new vehicles are responsible for reporting problems or defects in writing to the manufacturer. Following the complaint, the manufacturer must be given a “reasonable” number of attempts to correct the problem. Missouri’s Lemon Law states this requirement is met if (1) the vehicle has been in the repair shop for the same problem four or more times and the problem still exists, or (2) the vehicle has been out of service because of a problem covered by warranty for 30 or more working days since the delivery of the vehicle.

I’ve reported the defect, but the manufacturer is unable to fix my car. How will I be reimbursed?

If the reported problem cannot be fixed in a reasonable number of repair attempts the manufacturer has the option to either offer the consumer a cash refund or a vehicle of comparable value. Under the Lemon Law in Missouri, manufacturers are permitted to deduct a “reasonable allowance for the consumer’s use of the vehicle” from the refund. Missouri law also requires that a replacement vehicle must be acceptable to the consumer. Additionally, Missouri law provides that the warranty of a new vehicle with reported problems may be extended if the manufacturer has not repaired the new vehicle by the expiration of the applicable time period. For additional information, click here.

After several attempts to fix my vehicle’s defect, the manufacturer and I disagree about whether my car conforms to warranty and whether I should receive a refund. What options do I have to resolve this dispute?

If the manufacturer provides a reasonable number of attempts and indicates that it doesn’t believe the consumer is owed a refund, but the consumer still believes the vehicle does not conform to warranty, the consumer must submit a complaint to the manufacturer. Most auto manufacturers in Missouri have appeals procedures, often with arbitration boards, to resolve problems consumers have with the manufacturer or car dealership. Throughout the dispute procedure, the manufacturer is permitted to make a settlement offer, which the consumer may accept or reject. If a consumer resorts to an informal dispute settlement procedure, an action must be commenced within 90 days following the procedure’s final action.

If the consumer rejects the settlement offer, he may commence a court action against the manufacturer or dealer (1) within the earlier of six months following expiration of the express warranty, or (2) 18 months following the date of the vehicle’s original delivery to the consumer. The consumer is allowed to recover a sum equal to the aggregate amount of costs and expenses incurred, including attorney’s fees, if he prevails.

On the other hand, if the court determines that the claim was filed in bad faith or solely for the purpose of harassment, then the consumer will be liable for all costs and reasonable attorney’s fees incurred by the manufacturer. Missouri’s Lemon Law allows several affirmative defenses for the dealers and manufacturers of new vehicles including: (1) an alleged nonconformity does not substantially impair the use, market value, or safety of a motor vehicle; (2) a nonconformity is the result of abuse, neglect, or unauthorized modifications or alterations of a motor vehicle; (3) a claim by a consumer was not made in good faith; and (4) any other affirmative defense allowed by law.

Consumer Tips Regarding Missouri’s Lemon Law:

  1. If you suspect your new vehicle has a defect, report it to the manufacturer as soon as possible!
  2. If a defect in your new car has been “fixed” but you believe problems still exist, do not hesitate to report the defect to the car’s manufacturer again.
  3. Do not settle for less than what you are guaranteed in your warranty! There are appeals processes if you and the car manufacturer disagree about a defect. Know your rights as the owner of a new vehicle!

Cash Back Credit Cards

Recently, I was asked by WalletHub to comment on cash back credit cards.  The post should be forthcoming on the WalletHub site.  Nonetheless, I am also sharing my insights here:

•    Should everyone have at least one cash back credit card?

Not necessarily.  For starters, consumers should always “shop around” and compare credit cards, and be sure to understand what they are getting themselves into before signing up.  One resource consumers my find helpful is on the CFPB credit card agreement webpage. Furthermore, cash back may not be the most important feature for all consumers.  Consumers need to consider their own situations and interests.  Once again, the CFPB provides excellent resources on credit card features. Consumers also may not all qualify for the same types of credit cards, and should be sure that they are in a position to pay off credit card debt in a timely and prudent manner.  Anyone interested in finding out more about credit scores should check out CFPB’s “How do I get and keep a good credit score?”

•    What are the biggest mistakes that people make when shopping for a cash back credit card?

First, some consumers may take on another credit card without truly considering whether they should open themselves up to greater spending power, and falling behind on bills.  Second, credit card offers may be confusing with respect to annual fees.  For example, some credit card offers include a waiver of the annual fee for the first year, thus lulling consumers into ignoring that fee in their decision-making.  However, consumers are usually dismayed when the fee kicks in and dissipates any benefit of “cash back.”  At the same time, consumers may not be able to cancel the card at that time due to the debt they have incurred or the “hit” they would take on their credit scores for canceling a card so quickly.  Third, consumers often fail to read the rules and restrictions on earning cash back.  For example, some cards offer elevated cash back for certain categories of purchases, but then restrict what qualifies for that category. Take the example of “3% cash back on fuel purchases” – with the caveat that fuel purchases from stations that are linked to grocery stores do not qualify (a very common restriction).  Similarly, “big box” and “warehouse” stores may not qualify for elevated cash back on “grocery” purchases.  Again, it is important to read the fine print of any credit card agreement.  Fourth, credit card offers may restrict consumers’ redemptions.  Does the offer allow consumers to redeem cash back at any time and in any amount, or does the offer require that consumers wait until they have accumulated a certain cash back sum?  Does the offer allow consumers to get a check in the mail, or only a statement credit?  These are just some of the questions to ask and consider.

•    Why don’t all rewards credit cards offer cash back?

“Rewards” mean different things to different consumers.  Some consumers prefer to get travel points or other perks.  Some consumers do not qualify for cash back cards, or may focus on low interest rates over any rewards.  Again, consumers must always consider their own situations and interests.  Cash back cards are not right for everyone, and the credit card market has responded.

Congress Overturns CFPB Proposed Rule on Arbitration

 

Well, that proposed rule has been put to rest.  Vice President Pence broke the tie in the Senate to overturn CFPB’s proposed rule on arbitration.  See https://www.wsj.com/articles/congress-votes-to-overturn-cfpb-arbitration-rule-1508897968.  See also https://www.nbcnews.com/politics/white-house/pence-breaks-tie-senate-votes-kill-rule-allowing-class-action-n814021?cid=eml_onsite.

 

Avoid Paying Bad Debt and Borrow Smart

Many students take out tens of thousands of dollars worth of student loans to pay for undergraduate college expenses. According to studentloanhero.com, the average graduate in 2016 has $37,172 in student loan debt. How many of these students understand how student loans work or what methods of collection are legal?

The National Collegiate Student Loan Trust and its debt collector, Transworld Systems, Inc., will have to pay at least $21.6 Million because of illegal debt collection practices against private student loan consumers. In addition to the monetary penalty, over 800,000 student loan cases will have to be independently audited, and the companies are prohibited from attempting to collect on any loan, which either is too old to sue over or cannot be proven is owed according to the audit. Illegal activities include: violating consumer protection laws, filing false or misleading documents, and pursuing debts that they are not legally entitled to.

What is illegal debt collection?

“Zombie Debt” is the term used for debt when it is cut off, or “killed,” by a statute of limitations. In other words, the debt is too old for enforcement.  Thus, the debt is no longer owed to the lender or collectors.

Debt collection companies can purchase bundles of debt from lenders for pennies on the dollar. Then, these companies attempt to collect on as much of the debt as possible, because they are able to keep everything they collect. Further, they have not checked to determine if the debt is good or bad before they attempt collection. There are a number of reasons why, but, the point is, that they do not check to make sure.

How do I know if my debt is “Zombie Debt”?

Check the terms and conditions of your debt. The state laws applicable to your debt should be named in the terms and conditions of your loan documents. Once you determine which state, a quick google search should reveal the restrictions on collections companies.

For example, Delaware has a statute of limitations of 3 years, while South Dakota has a statute of limitations of 6 years. The statute of limitation sometimes begins when you last made a payment; other jurisdictions begin the statute of limitations several months after your last payment.

What Other Steps Can I Take to Protect Myself?

You can protect yourself from illegal debt collection practices by staying informed on how long companies can try to collect a debt; knowing what obligations you owe, and questioning notices received.

There are steps to take when choosing and paying student loans that can help protect yourself from fraudulent collectors and understand how much debt to expect.

First, use student loan calculators to understand the amount of debt and estimate how long it will take you to pay off your debt. If you are familiar with Microsoft Excel, you may download a calculator template, which will allow you to make changes and add extra payments. Thus, you can know exactly how much money you will owe at any given time and be prepared to identify any mistakes or bad collection practices.

Second, when applying for loans, check the reviews of the company making the loan or the ranking of the lender, to make sure the lender is reputable or has services and support available for borrowers. Also, feedback from customer’s interactions with a company can show how they treat their borrowers. Using a calculator, as mentioned above, helps you to know about how much money is remaining on your loan. These support features can help you figure out what discrepancies exist and why.

Third, check for news on student loan companies being accused of illegal practices and what those practices are. For example, if companies are claiming borrowers owe money they do not, and the companies are facing a lawsuit, it may be a good time to check your loan status and how much the company is claiming you owe. This can just be a simple google search for loan companies in trouble.

Ultimately

The biggest step anyone can take is to stay informed. When borrowing money, track your money independently. This is the same process as balancing a checkbook. Track how much you pay and include simple interest calculations, or more complex interest calculations if they are needed and you know how. Every three to six months compare your numbers with the numbers the lender is claiming and make minor adjustments (mostly to account for complex interest). This will enable you to know what questions to ask the lender to ensure no shenanigans, such as questionable fees, rate changes, or false debt claims, are occurring with respect to your loan.

Center for Dispute Resolution at University of Missouri

Campus Free Speech Issues and Dispute Resolution 

Although the free exchange of ideas is fundamental to every university’s mission, events on many of our nation’s campuses in recent years vividly demonstrate that preserving and promoting this principle in a university community presents enormous challenges. Members of the CSDR at the University of Missouri have had to deal with this type of conflict at a different level. In 2015, we were touched closely by events such as the shooting of Michael Brown by a police officer in Ferguson, Mo., a number of racially motivated incidents on our own campus, and the protests by students following those incidents, which, in turn, resulted in the resignations of high-profile campus leaders.

While perhaps Missouri played the role of the proverbial “canary in the coal mine,” confrontations like the one we experienced in 2015 soon emerged in other campuses across the U.S. Opposing narratives developed describing these events. One narrative portrays today’s students as hypersensitive and intolerant as they seek protections against offensive words and ideas, which results in the sacrifice of both intellectual rigor and First Amendment values. A counter-narrative posits that the rise in verbal abuse and violence against historically persecuted groups requires the prohibition or limitation of hateful, intolerant, or threatening speech on our campuses, as learning becomes impossible in an environment where members of the community feel unsafe.

Motivated by those experiences, Prof. Robert Jerry, who served as the dean of the law schools at the University of Florida and the University of Kansas for a combined total of 16 years, and who teaches and writes in dispute resolution among other subjects, and Prof. Chris Wells, who is one of the leading First Amendment scholars in the country and teaches in the dispute resolution area, have organized the 2017 CSDR/Journal of Dispute Resolution Symposium along this topic. The symposium, which is titled “The First Amendment on Campus: Identifying Principles for Best Practices for Managing and Resolving Disputes,” will explore the complex intersection between free expression and conflict at universities.

In what is likely a first-of-its-kind-effort, the program will bring together free speech scholars, dispute resolution experts, and university leaders with experience with free expression conflict, with the goal of advancing our understanding of how university leaders can remain true to both the mission of the university and the values of the First Amendment.

The timing of the symposium is particularly propitious for us, as it coincides with the arrival of our new Dean Lyrissa Lidsky, who is also an expert in First Amendment Law and has written on the topic of campus speech issues.

 

Expanding Access to Justice through ODR 

At one time, transactions between merchants and consumers were often sealed with a handshake. This handshake was more than a kind gesture—it helped reassure both parties that the other was committed to the deal and would correct any problems. As more transactions occur online, finding fair and efficient resolution of problems that arise can be challenging. In her new book with Colin Rule of Tyler Technologies, Prof. Amy J. Schmitz argues that using technology to enhance access to remedies is in the best interest of both retailers and consumers. In their book, The New Handshake: Online Dispute Resolution and the Future of Consumer Protection, Schmitz and Rule propose a design for this using Online Dispute Resolution (ODR) to establish a new virtual handshake for the online world. Their proposed process uses a single platform that merchants and consumers would access to resolve disputes. The platform would have a single set of guidelines, would abide by agreed due process standards, and would include means for alerting regulators regarding suspected fraud or unsafe products. It would utilize forward thinking encryption and coding to ensure privacy and coordinate with other consumer remedy processes throughout the world. Indeed, the EU has established its own ODR platform, UNCITRAL has pursued global ODR, and new ODR programs continually emerge in the wake access to justice movements.

The proposal is a collaboration between Schmitz, a consumer advocate and founder of MyConsumertips.info; and Rule, a high-tech entrepreneur who had directed ODR for eBay. In this way, the project aims to create a win-win for consumers and businesses. “Our goal is to rebuild trust in the business-to-consumer marketplace and provide a blueprint for the future of online consumer protection.” More information can be found at Newhandshake.org and Prof. Schmitz’s interview on the book can be heard here. A few comments on the book include: Corporate Counsel; ODR.INFO; Oxford Business Law Blog; Business Conflict Management LLC.

 

Making Stone Soup 

The Stone Soup Dispute Resolution Knowledge Project is designed to promote collaboration by faculty, students, scholars, practitioners, educational institutions, and professional associations to produce, disseminate, and use valuable qualitative data about actual dispute resolution practice.

Professors John Lande and Rafael Gely are the co-directors of the project, which grew out of the Center’s 2016 symposium, Moving Negotiation Theory from the Tower of Babel Toward a World of Mutual Understanding. Several symposium speakers criticized the current state of negotiation theory and argued that more empirical research about actual negotiations is needed to advance negotiation theory.

Faculty have multiple ways to participate in the project. For example, they may use their courses to generate knowledge about dispute resolution. As part of their course requirements, students may interview professionals and/or laypeople about actual cases. Some faculty may conduct “focus group classes” in which they systematically ask selected guest speakers about actual cases. Faculty may use these assignments and activities in a wide variety of courses including those that do not specifically or exclusively focus on dispute resolution.

The project encourages schools to take advantage of practitioners’ perspectives by conducting general debriefing of student competitions. Faculty may also take advantage of talks at continuing education programs to obtain data from practitioners. For more information, see law.missouri.edu/drle/stone-soup.

In this inaugural year of the project, it should engage at least 800 students in 48 classes covering 17 subjects, taught by 29 faculty from 24 schools in three countries.

 

Dispute Resolution Empirical Research 

Empirical research has long been a mainstay of dispute resolution scholarship, and the members of the CSDR continue to generate ground-breaking and influential work. Some recent work in this field was conducted by Prof. S.I. Strong in her article “Realizing Rationality: An Empirical Assessment of International Commercial Mediation,” 73 Washington and Lee Law Review 1973 (2016), which included the first-ever large-scale international study of international commercial mediation. Preliminary findings from that project were provided to the United Nations Commission on International Trade Law (UNCITRAL) to support efforts to adopt a new international instrument relating to the enforcement of settlement agreements arising out of commercial mediation.

Prof. Strong, with Prof. Rafael Gely, CSDR director, is currently working on a new project funded by a $25,000 grant from the American Arbitration Association-International Center for Dispute Resolution (AAA-ICDR) Foundation. The project seeks to expand the understanding of arbitrator reasoning in international commercial disputes by conducting a multi-phased empirical study. The first prong of the research involves a series of semi-structured interviews with leading arbitrators working in the area of national and international commercial arbitration so as to identify the goals arbitrators that are seeking to achieve when writing reasoned awards and how arbitrators believe they are fulfilling those aims. The second prong of the study involves an international survey of commercial arbitrators and judges. This material will seek to confirm information gleaned during the interviews and to identify additional supplemental material. The third prong is doctrinal in nature and involves an empirical analysis of publicly available arbitral awards gleaned from enforcement proceedings in court or published in arbitral reports and judicial decisions gleaned from case reports in the United States and elsewhere. After identifying the relevant awards and decisions, the materials will be coded for various attributes and analyze the data to determine whether there are any differences between national and international commercial awards on the one hand fully reasoned arbitral awards and judicial decisions on the other.

Prof. Gely is also undertaking a separate strand of empirical research looking at how is the arbitration process portrayed in the mainstream media. Motivated through a partnership with the National Academy of Arbitrators, Prof. Gely and his collaborators, and drawing from the work of scholars in communications and journalism, the research project is seeking to collect and analyze data taken from news reports about arbitration. The goal of the project is to better understand how the media is reporting about arbitration. A preliminary article discussing the research project (“What and How Journalists are Reporting About Arbitration”) was published in Proceedings of the Sixty-Ninth Annual Meeting of the National Academy of Arbitrators, Arbitration 2016: Arbitration in Practice.

 

More News 

Mizzou Law – CSDR • 206 Hulston Hall, Columbia, MO 65211

CFPB is Fighting the Good Fight

The Consumer Financial Protection Bureau (CFPB) today announced that its recent work resulted in $14 million in relief to more than 104,000 harmed consumers from January through June 2017. The Press release read in part:

“Today’s report, the 16th edition of Supervisory Highlights, covers CFPB supervision activities from January through June 2017, and shares observations in the areas of auto loan servicing, credit card account management, debt collection, deposits, mortgage origination, mortgage servicing, remittances, service providers, short-term small-dollar lending, and fair lending. Among the findings:

  • Banks deceived consumers about checking account fees and overdraft coverage: One or more institutions deceived consumers by inaccurately describing when checking account service fees would be waived. One institution told consumers it would waive the fee if the customer met certain qualifications, including making 10 or more payments from the checking account during a statement cycle. In fact, only debit card purchases and debit card payments qualified toward the fee waiver. One or more institutions also misrepresented opt-in deposit overdraft services as extending to consumer payments by check, electronic funds transfers through the Automated Clearing House payment network, or recurring payments, when those transactions were not actually covered.
  • Credit card companies deceived consumers about the cost and availability of pay-by-phone options: The Bureau’s examiners found that customer service representatives of at least one credit card company disclosed only costly pay-by-phone fees while omitting mention of much cheaper payment options. Failing to disclose less costly options can result in consumers being charged for services they don’t need.
  • Auto lenders wrongly repossessed borrowers’ vehicles: Many auto loan servicers give borrowers options to avoid repossession of their vehicle if a loan is delinquent or in default. But the CFPB’s examiners found that one or more companies were repossessing vehicles after the repossession was supposed to be cancelled. Some lenders wrongfully listed the account as delinquent. In other instances, customer service representatives did not cancel the repossession order when feasible after borrowers made sufficient payments. Also, some repossession agents did not check the documentation beforehand to see if the repossession had been cancelled.
  • Debt collectors improperly communicated about debt: Generally, debt collectors must get consent of the person owing the debt before discussing it with other parties. The Bureau’s examiners found that one or more third-party collectors did not confirm they had contacted the right person before starting collections, or wrongly attempted to collect from consumers who were not responsible for the debt. Also, one or more payday lenders, in collecting a debt, repeatedly called third parties, including personal and work references listed on the borrowers’ loan application. In some instances, even after being told to stop, these collectors called borrowers at work or asked third parties to relay messages to them. Such calls can lead to negative job consequences for the borrower, and risk improperly disclosing the default or delinquency to third parties.
  • Mortgage companies failed to follow Know Before You Owe mortgage disclosure rules: CFPB examiners found that one or more companies overcharged closing fees to consumers and one or more companies wrongly charged application fees before consumers had agreed to the mortgage transaction. Examiners did find that in general, both banks and nonbanks were able to effectively implement and comply with the Know Before You Owe mortgage disclosure rule changes.
  • Mortgage servicers failed to follow the Bureau’s servicing rules: Servicers are responsible for reviewing borrowers’ initial loss mitigation applications to determine what documents are missing. They must then tell borrowers what documents are missing, so that consumers can get a full evaluation of options they have available. One or more mortgage servicers offered a forbearance option to consumers to help them prevent foreclosure, but did not let the borrower know of their right to complete an application to be considered for other options. In addition, they did not exercise reasonable diligence in collecting information needed to complete the borrower’s application. Additionally, one or more servicers, through a vendor, also provided borrowers mortgage statements that failed to specifically list fees charged.

Today’s report shares information that companies can use to comply with federal consumer financial law. When CFPB examiners find problems, they alert the company and outline necessary remedies. These steps may include paying refunds or restitution, or taking actions to stop illegal practices and assure future compliance such as implementing new policies, or improving training or monitoring. When appropriate, the CFPB opens investigations for potential enforcement actions.”

For more information, see: today’s edition of Supervisory Highlights is available at: http://files.consumerfinance.gov/f/documents/201709_cfpb_Supervisory-Highlights_Issue-16.pdf

College Textbooks – Worth Their Weight in Gold?

Anyone who has either been in college recently or has had a child in college knows that textbooks are expensive. Some textbooks cost well over $200. Many students continue to purchase textbooks from their campus bookstore and then resell those books back to the university. The main reason is simply the convenience of purchasing the books near where you have the courses and not having to order them in advance. Unfortunately, campus bookstores often charge far more for books regardless of condition (New, Used, or Rental) than online retailers. Moreover, the campus bookstores also will pay far less for them at the end of the semester than other sources will.

What is the most cost effective way to purchase textbooks?

For any student looking to save money on their books, there are three simple steps. First, the student must determine the textbooks’ ISBN numbers, which can be used to find that textbook elsewhere. Many campus bookstores offer online book lists with ISBN numbers based on a student’s schedule. Second, the student needs to compare prices on a website, such as CheapTextBooks.org, or just search online retailers, such as Barnes & Noble or Amazon. Third, the student needs to order the books at least 2 weeks before classes begin.

Students always have the option of renting a textbook, rather than purchase the textbook. Websites, such as Amazon or CheapTextBooks.org, may have an option to rent the textbook for less than purchasing the book. This choice comes down to the preference of the student. If the student plans on making many notes and highlights in the book while studying, renters may charge the student. However, the student would not be responsible for reselling the book at the end of the year.

I, personally, recommend purchasing the textbook used around 3 weeks before courses start to get a lower price than right before classes start. Also, I recommend purchasing over renting textbooks, because a student may recover more money by reselling the books than students can initially save by renting.

What is the most cost effective way to resell textbooks?

Finals are over and students have 100lbs of textbooks that they never want to open again. Students have several options for reselling textbooks. Students may sell to the campus bookstore, a textbook company, or to another student. First, as mentioned above, reselling a book to the campus bookstore is not going to pay the most. Fortunately, some bookstores offer a minimum buyback price for those books which can only be purchased from the bookstore or are no longer used. For example, your marketing class requires you to pick up a book unique to your university. So you have to purchase the book from the campus bookstore. When classes are over, the marketing class decides to use a different book in the future. The student can go to the campus bookstore during their buyback and still sell the book back for $5.00 or some other minimum. Second, many textbook companies will set up on campuses at the end of the semester offering to buy textbooks for students. Most of their offers will be higher the campus bookstore’s offer. However, these tend to be picky about what books they purchase, and will not buy above a certain number of books. Third, the best way to recover your price of a textbook is to resell the book yourself to another student. Selling through an online retailer, such as Amazon, will cost a fee, but you will make far more money than reselling a book to a bookstore to act as a middleman.  However, this method requires much more effort than the first two. The student will have to ship the textbook to the other student and there is a chance the textbook will not sell.

This past semester I resold my books through Amazon and recovered most of my money. So, since I chose Amazon, I created a sellers account and then priced my books at the lowest price (or lowest price+shipping). The closer the school year comes, the more expensive books tend to get. Therefore, unlike when purchasing books, you should sell your books closer to classes beginning.