ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
December 15, 2020
The Gateway For Payroll Data
Consumers are spending more in 2020 than they did in 2019, says Bank of America CEO

Consumers are spending more via Bank of America accounts this year, in the midst of the coronavirus pandemic, than they did in 2019, according to CEO Brian Moynihan.

“When you look at what they’re spending year-to-date, they’ve spent more in 2020 than they did in 2019, and that is now across $2.7 trillion in money moved by our consumers,” Moynihan told CNBC’s Wilfred Frost in a Wednesday interview.

Consumers are spending more via Bank of America accounts this year, in the midst of the coronavirus pandemic, than they did in 2019, according to CEO Brian Moynihan.

“When you look at what they’re spending year-to-date, they’ve spent more in 2020 than they did in 2019, and that is now across $2.7 trillion in money moved by our consumers,” Moynihan told CNBC’s Wilfred Frost in a Wednesday interview.

Paving the Payments Future
Can a debt collector repo your car?

When you take out a personal loan or other form of debt, it’s important to make a plan to pay it back according to the terms you agreed to. If you go too long without making a payment, you risk hearing from a debt collector.

You may be concerned about what assets a debt collector can seize, particularly if you own something as expensive as a car. In most cases, the debt collector won’t be able to repossess or take your car. However, there are a few exceptions where it may be possible for them to do so.

Can a debt collector take my car?
If you have unsecured debt — debt that is not backed by collateral, such as a car or home — it’s difficult for a creditor to seize your assets. For example, if you’ve defaulted on an unsecured personal loan or credit card debt, collectors don’t have a legal standing to repo your car because of your debt.

COVID-19 paid leave tax credits for Small and Midsize businesses

Small and midsize employers can claim two NEW refundable payroll tax credits.

The paid sick leave credit and the paid family leave credit are designed to immediately and fully reimburse eligible employers for the cost of providing COVID-19 related leave to their employees.

NEVADA: Financial regulators take another step toward payday lending database adoption, months after deadline

After nearly a year in development, Nevada financial regulators are finally moving forward with a set of regulations that will implement a statewide database for high-interest, short-term payday loans.

Members of Nevada’s Financial Institutions Division — the regulatory body that oversees activities and certification of payday and other high-interest lenders — on Wednesday approved draft regulations that fully flesh out details of the database and what kind of information it will collect.

Adoption of the regulations — which still need to be approved by the state’s interim Legislative Commission that gives final stamps of approval to agency regulations — was applauded by backers of SB201, the bill from the 2019 Legislature that required the database’s creation. Nevada Legal Aid Policy Director Bailey Bortolin said Tuesday that approval of the regulations was a welcome sign despite the fact that the law required the system be operating by this summer.

Can Regulators Foster Financial Innovation and Preserve Consumer Protections?

An investigation of mobile and faster payments, regulatory sandboxes, and the challenge of maintaining customer safety

Overview
Between 2010 and 2018, U.S. investments in financial technology, or “fintech,” grew from almost $2 billion to more than $100 billion, with over half of the increase occurring in 2018 alone. Among the ripest spaces in the financial sector for a technology upgrade is payments—the systems that move money between people and institutions—which currently rely on aging infrastructure and often make consumers wait for access to their funds. Payments innovation is important not only to ensure the expediency and safety of everyday transactions, but also to speed the delivery of government benefits or funds to those in need, especially during emergencies, such as natural disasters and the COVID-19 pandemic and resulting recession. As businesses and policymakers seek to promote the development of new payments technologies, the need to also ensure safety and efficiency will present a range of challenges to regulators and traditional financial systems.

Bank of America flags 640K accounts on suspected unemployment benefits fraud

  • More than $2 billion has been stolen from California’s unemployment fund, Bank of America said this week.
  • Bank of America identified 640,000 accounts in the state’s unemployment benefits system with suspicious activity that should be investigated, bank officials told state legislators in a letter. That includes 76,000 payment cards, on which the benefits are issued, sent to people in nonadjacent states less likely to temporarily host out-of-work Californians.
  • Red flags have also been issued on claims filed in the names of infants, children and centenarians, the bank said. In "numerous cases," multiple cards — hundreds, in some instances — were sent to a single mailing address or used a common contact phone number, Brian Putler, the bank's director of California government relations, wrote, according to the Los Angeles Times and Newsweek.

CFPB adds five to its leadership team

The Consumer Financial Protection Bureau (CFPB) has added five people in various leadership positions, including chief operating officer. Additions are Matthew Bettenhausen, Chris Chilbert, Janis Pappalardo, Donna Roy, and Deborah Royster.
Bettenhausen serves as the senior advisor and counselor to the director. Prior to this position, he was an assistant U.S. attorney with the Department of Justice in the Northern District of Illinois.

Chilbert joins the bureau as the chief information officer in its operations division. Previously, he was assistant inspector general for information technology at the U.S. Department of Health and Human Services.

Pappalardo is the bureau’s associate director for research, markets, and regulations. She previously served as assistant director for consumer protection at the Federal Trade Commission.

Virginia Passes Bipartisan Payday, Title Loan Reform

Law closes regulatory loopholes, caps interest rates, and provides lessons for other states

Overview
After years of legislative efforts to foster a safe and viable market for small loans, Virginia lawmakers in 2020 passed bipartisan legislation—the Fairness in Lending Act (S.B. 421/H.B. 789)—to prohibit loans with large final payments, known as balloon payments, and bring down prices. The law rationalizes what had been a disparate regulatory structure, governed by a patchwork of laws that allowed payday and auto title loans with unaffordable payments and unnecessarily high costs, and exposed borrowers to financial harm, including repeated borrowing and high rates of vehicle repossession. Previous research by The Pew Charitable Trusts showed that before the reforms, companies routinely charged Virginians three times more than customers in lower-cost states.1

Reverse Mortgage Lending Limit Rises to Over $822k in 2021

The lending limit for federally-backed reverse mortgages is increasing for the fifth consecutive year in a row, set to hit $822,375 in 2021.

The Department of Housing and Urban Development (HUD) announced on Wednesday via Mortgagee Letter (ML) 2020-42 a maximum claim amount of $822,375 for calendar year 2021, a rise of $56,775 from the $765,600 limit governing the Home Equity Conversion Mortgage (HECM) program in 2020.

HUD calculates this figure at 150% of the conforming loan limits on mortgages to be acquired by Fannie Mae and Freddie Mac, which was announced by the Federal Housing Finance Agency (FHFA) last week to be $548,250 for calendar year 2021—up from $510,400 in 2020.

Millennials, You Should Be Doing a Lot (More) To Manage Your Credit Scores!

Credit and credit scores institutionalize the idea of 'trust' in lending/borrowing through numbers and algorithms

As a generation, millennials prefer every part of their lives to keep pace with their ambitions, instead of being a hindrance. Very often, bad credit scores can be just that, a hindrance of and managing credit scores, a tedious task.

Why should I care about credit scores?
Credit and credit scores institutionalize the idea of ‘trust’ in lending/borrowing through numbers and algorithms. The credit score, a three-digit number ranging from 300 to 900, is an assessment of the eligibility to repay the loan one has taken. The higher the score, the better a borrower looks to potential lenders.

Possible business bankruptcy surges being weighed by US Fed, global Financial Stability Board, Quarles says

The US Federal Reserve and the international Financial Stability Board are looking into the possibility that bankruptcies, especially among small businesses, will swell next year, the Fed’s top regulator said.

The current consensus, Fed Vice Chairman for Supervision Randal Quarles said, is that bankruptcy filings will increase as a result of the pandemic but not overpower the financial system.

“Has the success of official intervention delayed an inevitable wave of bankruptcies of firms, especially small firms, instead of happening over the course of the summer?” he asked at a conference. “We thought we’d see this in the third or fourth quarter, but it’s not happening.”

FHA raises loan limit by nearly $25,000 for 2021

High-cost ceiling jumps a whopping $56,000

Given massive year-over-year gains in home prices, the Federal Housing Administration (FHA) is increasing its 2021 loan limit in most of the U.S. to $356,362, an increase of nearly $25,000 over 2020’s loan limit of $331,760.

That loan limit figure is determined as a percentage of the national conforming loan limit for Fannie Mae and Freddie Mac, which is increasing in 2021 to $548,250.

FHA’s 2020 minimum national loan limit, or “floor,” of $356,362 is 65% of the national conforming loan limit of $548,250. This floor applies to low-cost areas, which are counties where 115% of the median home price is less than the floor limit.

ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
Alternative Financial Service Providers Association
757.737.4088
315 Tuscarora St., Lewiston, NY 14092