NEWS: September 7

NEWS is brought to you by AFSPA Endorsed SUPPLIERS

American Express is making a major change - because of millennials
AmEx now allows certain large credit card purchases to be paid via installments

Can't pay your American Express AXP, -0.15% bill in full? No problem.

The credit-card company unveiled a new feature called "Pay It Plan It" this week, which it says it designed with millennials in mind. It became available for existing card members on Aug. 30. "Pay It Plan It" will allow consumers to pay for certain purchases of $100 or more in installments.

The plan isn't necessarily designed to be a better deal for consumers, but it is a way for them to feel more comfortable, knowing in advance how much interest they will pay total, said Kartik Mani, the global head of consumer lending at American Express.

Traditionally, credit cards have not offered this option, which is similar to financing plans retailers use so shoppers can split up payments on big purchases such as furniture. Before "Pay It Plan It," Amex members accrued interest on their entire bill and did not have the option to create an installment plan for any purchases.

But under the new program, users can separate selected purchases from the remainder of their credit card bills and, instead of paying the card's interest rate on those purchases, they'll pay a flat fee every month.

American Express offers two types of cards: "charge cards," which consumers are required to pay in full every month, and "credit cards," which allow users to maintain balances. The "Pay It Plan It" option will only be available on "credit cards." Read more at MARKETWATCH
CFPB's Change Of Heart Regarding Payday Lenders

The final payday lending rules are coming, but reporting by The Wall Street Journal over the weekend suggests that they may not take quite the toll on the lending industry as once thought. The Consumer Financial Protection Bureau (CFPB), it seems, is considering proposals that would scale back the rule's scope.

Instead of casting the net very, very wide to include all short-term lending in total, the new rule will instead focus on small-dollar loans with a term of about two weeks. Known more commonly has payday loans, these loans are differentiated from a similar product, installment loans, which tend to last for 45 days or more.

Both loans carry high costs - annual interest rates for both payday and installment loans quickly run into the triple digits - but the payday variety is what has earned more of the CFPB's ire. It's also become their focus as they are hoping to get legislation in and finalized before a new director takes over.

But Doesn't Director Cordray Have Another Year?

Richard Cordray, the CFPB's current director, is a 2012 Obama appointee and one with a good deal of power to act independently, given the unique structure of the CFPB. His five-year term technically runs through July of next year.

But rumor has it that Cordray, who certainly will not be reappointed by President Trump, has already scoped out his next job: being the state of Ohio's next governor.

The rumors at this point are just that: rumors. However, Cordray-watchers have been noting things like the not-so-coincidental engagement at the AFL-CIO's Labor Day picnic in Cincinnati and an op-ed titled "Let Consumers Sue Companies" for The New York Times on Aug. 22 defending the arbitration rule. To the chattering classes in politics, it sure looks like Cordray is preparing for a run.

And Representative Jeb Hensarling (R., Texas) - Cordray's arch nemesis in Congress and the chair of the House Financial Services committee - has also spent much of 2017 offering a running commentary on Cordray's potential gubernatorial bid. Read more at PYMNTS.COM
Dreher Tomkies LLP
FICO survey finds consumer fears tied to bank fraud and identity fraud. by Philip Burgess

New FICO research discovered that U.S. consumers are more fearful of identity theft and bank fraud than terrorist attacks.

While there's good reason for consumers to fear becoming a victim of identify theft or bank fraud, this predisposition impacts their decision to seek out credit options with retailers and other businesses.

Companies that extend consumer credit need to instill confidence in their clientele and assure them their sensitive personally identifiable information (PII) is secure.

The latest FICO data
The FICO report revealed 44 percent of U.S. consumers said their top concerns were banking fraud and identity theft. Fortunately, 78 percent of respondents who were victims of fraud said their bank's response satisfied their expectations.

In comparison, only 18 percent of percent of respondents cited fear of being a terrorist attack victim, while 22 percent said they primarily worried about their own death or that of a loved one.

Despite the satisfaction rate of consumers who said they approved of their bank's reaction to fraud and theft, the worry is all too real for consumers. This will cause the public to be significantly less inclined to seek out new credit options, and they may become more unwilling to provide sensitive PII to businesses and retailers offering credit. Read more at MICROBILT
4 steps to ace a fall financial checkup
Now's the time to check in on your 2017 financial plan.

Here are four steps to take and save money before the end of the year.

If kids can get organized for the start of school, adults should be able to do something similar with their finances.

The beginning of fall is the perfect time to revisit your financial wellness and make some changes before the end of the year, experts say.

These days, families have less slack in their budgets than before, according to research by The Pew Charitable Trusts. Household spending has risen 25 percent or more in the past two decades, even adjusting for inflation - yet incomes have not kept pace, the study said.

In addition, previous Pew research found that one in three American families have no savings.

1.) Budget

To that end, this is a crucial time to revisit your 2017 cash flow and see how it is shaping up.

"There's no sense in setting a 2018 budget if you're not going to adhere to it," said Mark Avallone, president of Potomac Wealth Advisors

Avallone added that "all the planning is meaningless if we don't follow through. It's very important to track your revenue and expenses and automatically save any discretionary cash that's left over," he said.

"Traditionally people say 10 percent, but in reality they may need to save well over that target."
For the Fourth Time, FactorTrust Named to the Inc. 5000 list for Significant Growth

ATLANTA-FactorTrust®, the Alternative Credit Bureau™, today announced it has been named one of the fastest-growing private companies in the U.S. by Inc. 5000. For the second consecutive year, not only was the company the only private, alternative credit bureau to make the list, it was also ranked the eighth fastest-growing financial services firm in Georgia.

This is the fourth year FactorTrust has been named to the list for its significant growth in revenue and company size. The list represents a unique look at the most successful companies within the American economy's most dynamic segment- its independent small and midsized businesses. The average company on the list achieved a three-year growth of 481 percent.

"Our growing team of industry champions set us on the path to unprecedented growth in both revenue and innovation in recent years," said FactorTrust CEO Greg Rable. "Our team's expertise, coupled with better recognition of the impact of alternative credit data for evaluating creditworthiness of underbanked consumers, is driving FactorTrust as the leading alternative credit reporting and analytics agency."

The Inc. 5000's aggregate revenue is $206 billion, and the companies on the list collectively generated 619,500 jobs over the past three years. Complete results of the Inc. 5000, including company profiles and an interactive database that can be sorted by industry, region, and other criteria, can be found at

"The Inc. 5000 is the most persuasive evidence I know that the American Dream is still alive," says Inc. President and Editor-In-Chief Eric Schurenberg. "The founders and CEOs of the Inc. 5000 tell us they think determination, risk taking, and vision were the keys to their success, and I believe them." Read more at FACTORTRUST
The surprising logic behind the use of check cashers and payday loans

Often seen as predatory, the check cashing industry has been booming. Lisa Servon wondered why lower-income people who were struggling would cash checks instead of getting a bank account, so she took a job as a cashier to find out. What she learned -- that it's often cheaper -- is the subject of her new book, "The Unbanking of America." Economics correspondent Paul Solman reports.

HARI SREENIVASAN: Next: You need some cash real quick?

Economics correspondent Paul Solman explores why, for some customers, the best bet might not be the bank.

It's part of his weekly series Making Sense of financial news.

JOE COLEMAN, President, RiteCheck: And this is East 138th Street, which in many ways is the Wall Street of the Bronx. You have got a lot of financial service providers along the street, bodegas. You have small money remitters.

PAUL SOLMAN: And there's a pawn shop, not the kind of financier you would find on the actual Wall Street. But, hey, this is the South Bronx, poorest congressional district in America, where some 40 percent of residents live below the poverty line.

JOE COLEMAN: The main service provider on the street is RiteCheck, where we have our financial service center. Read more at PBS NEWSHOUR
A_S Management
Reverse Mortgages Will Soon Be Less Attractive

One way to supplement your income in retirement is about to become tougher. The Trump administration just announced new policies taking effect Oct. 2 that will increase the upfront cost of reverse mortgages for many borrowers and reduce the size of the loans.

If you're 62 or older (the reverse mortgage age requirement) and have been thinking about converting your home equity into cash, you may want to apply for a reverse mortgage before the new rules kick in next month.

Smaller Reverse Mortgages, Bigger Upfront Premiums

"Many consumers getting reverse mortgages after October 2 will get a lesser amount of money than before and, depending on how they draw out the money, will pay more in mortgage premiums," said Peter Bell, president and CEO of the National Reverse Mortgage Lenders Association.

"The issue," Bell added, "is that the [Home Equity Conversion Mortgage or HECM] program costs more to administer than the Trump administration feels is justified or that the premiums cover." With a HECM reverse mortgage, you pay an FHA-approved lender an upfront fee and then have access to a percentage of your home equity. The loan is repaid when you move, sell the home, die or fail to pay property taxes or homeowners insurance to maintain the property. The maximum size of a reverse mortgage depends on your age, home value, interest rate and upfront costs.
Red Cross  

AFSPA helps our members grow their Alternative Financial Services business by providing them with the best information, research, data, support, relationships and by vetting and presenting the best available product and service providers for the Alternative Financial Services Industry. 

Alternative Financial Service Providers Association

315 Tuscarora St., Lewiston, NY 14092