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Report finds rise in consumer finance complaints during pandemic

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by Andrew Stahl

The number of financial complaints filed by consumers in the Consumer Financial Protection Bureau has risen dramatically during the COVID-19 pandemic, according to an analysis of the CFPB database by LendEDU, an online marketplace for financial products.

LendEDU found a 44% increase in the number of consumer finance complaints filed from March 13 to July 17 of this year, compared to the same period last year. Their analysis also found a 38% increase in complaints from March 13 to July 17 compared to the previous 127-day period.

The report found the largest percent-increases in complaints were filed under the “money transfer, virtual currency, or money service” and “credit reporting, credit repair services, or other personal consumer reports” categories.

LendEDU suggested that the increase in complaints was partially due to erroneous credit reporting while pandemic-related flexibility programs were in place, and money transfer phishing scams, specifically fake Venmo accounts and text messages requesting money. Problems with pandemic-related deferment programs for credit card payments, which numerous credit card companies offered to consumers who proactively notified them, also led to a rise in credit report issues.

“The biggest consumer finance problems since the beginning of the coronavirus pandemic have pertained to credit report issues,” the report said. “Specifically, a lack of chemistry between consumers, financial institutions and the credit bureaus to properly manage the added deferments and adjusted payment plans.”

Meanwhile, complaints regarding both student loans and mortgage payments dropped, by 41% and 4% respectively. The report suggested that the steep drop in student loan complaints may be due to all federal student loans being placed in forbearance until September 30.



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Credit Card Deal: American Express Blue Cash Preferred®

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If the pandemic has had a lasting effect on your spending habits, then it’s likely that you eat in more often, and spend more time cooking at home and watching television. If there’s one credit card that’s suited to this lifestyle, it’s the Blue Cash Preferred® Card from American Express, which is now offering new applicants the opportunity to earn up to $350 in cash back. Terms Apply.

How this card works

New applicants of the Blue Cash Preferred® card can earn $150 in cash back after spending $3,000 on purchases within six months of account opening. You’ll also earn 20% back on all your Amazon.com purchases within six months of account opening. This cash back is limited to your first $1,000 in purchases, which means that you can earn up to $200 cash back (for a combined total of $350 back). The cash back will come in the form of a statement credit that reduces your balance, so you won’t need to redeem any rewards or be concerned with points that can expire.

This card also offers some of the highest rates of cash back that you can earn from a credit card, including a whopping 6% back (on up to $6,000 spent per year) at U.S. supermarkets (worth up to $360 per year). You also earn unlimited 6% cash back for purchases from dozens of select U.S. streaming subscriptions including Netflix, HBO Max, Amazon Music Unlimited and Disney+. Furthermore, you’ll earn 3% cash back at U.S. gas stations and on transit purchases including taxis, rideshare, parking, tolls, trains, buses (and more), plus earn 1% back on all other purchases.

What does it cost?

This card has a $95 annual fee, but it’s waived the first year. The card also offers new applicants 12 months of 0% intro APR on new purchases, then a variable rate 13.99% – 23.99% applies.

Bottom line

If you’re going to sit at home, cook and watch TV, you might as well earn as much cash back as possible. By taking a closer look at the American Express Blue Cash Preferred, you might find that you’re eligible for more cash back than you ever thought possible.

See Rates & Fees for Blue Cash Preferred by American Express.

Ads by Money. We may be compensated if you click this ad.AdAds by Money disclaimer

A credit repair company could improve your chances of getting approved.

Credit Repair companies, like Credit Saint, specialize in finding and helping you remove mistakes on your report to help you improve your credit.

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