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Report: Massive Uptick in Consumer Finance Complaints During Coronavirus Pandemic

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The role of the Consumer Financial Protection Bureau (CFPB) has come under scrutiny, but as of the time of this writing, it’s still a place for consumers to log complaints against financial institutions.

And during the coronavirus pandemic, the number of financial complaints filed in the CFPB’s database is surging according to a new analysis by LendEDU.

Massive unemployment and reduced business capacities brought on by the pandemic have triggered a recession and made it tough for everyday people to meet monthly financial obligations like mortgage payments.

Financial institutions have shown a willingness to be flexible with customers, but it appears this unprecedented situation has made a mess of the relationship between consumers, financial institutions, and credit bureaus…and consumers are suffering the most as a result.

LendEDU’s analysis saw a 44% year-over-year (YOY) increase in the number of consumer finance complaints from March 13, when President Trump declared a national emergency, to July 17.

There was also a 38% increase in complaints from March 13 to July 17 compared to the previous 127-day period ending on March 12, 2020.

Note: If you would like a raw file of any data found below, or if you would like to see if LendEDU has more data than what was included in this report, please email me at [email protected]

In 2020, 140,042 CFPB Complaints Were Filed From March 13 to July 17 Compared to 97,008 Filed Over Same Time Last Year

The CFPB consumer complaint database gives aggrieved consumers a portal to file complaints against specific financial institutions, who are then given notice of the complaint and a window to respond.

The first part of our analysis involved gathering the raw number of CFPB complaints filed from March 13, 2020, to July 17, 2020, a 127-day period. We also tallied complaints filed from March 13, 2019, to July 17, 2020, to find YOY differences, and from November 7, 2019, to March 12, 2020, to find differences from the previous 127-day period.

While both the YOY and 127-day differences jump out at you right away, the percent increases in the number of complaints really exemplify just how many consumers are dealing with financial mishaps during the coronavirus pandemic.

Where Have the Increases Taken Place?

For both the YOY and prior 127-day periods, there were notable percent increases in the number of CFPB complaints in the “credit card or prepaid card,” “credit reporting, credit repair services, or other personal consumer reports,” and “money transfer, virtual currency, or money service” categories.

Biggest Riser: Credit-Related Complaints

There was an 84% YOY increase in the number of “credit reporting, credit repair services, or other personal consumer reports” complaints, and there may be a good explanation for that.

As the coronavirus pandemic constricted budgets and depleted savings accounts, many consumers began finding it difficult to meet monthly payments. An earlier LendEDU survey found 54% of Americans were worried about making their credit card payments due to the pandemic, while 57% had the same concern over their mortgage payments.

Because of this, many financial institutions were flexible with borrowers and agreed to things like a reduced minimum payment or even a deferment period.

However, it appears that many of these agreements were never really confirmed or finalized because many consumers saw their credit scores negatively impacted for missed or insufficient payments.

Adem Selita, co-founder of The Debt Relief Company in Manhattan, saw this with many of his clients:

We have had numerous clients with erroneous markings on their credit report and negatively impacted credit scores due to the pandemic and the relief programs set in place by many banking institutions and credit card companies. I would say this is most likely occurring with about 20% to 25% of all credit reports we’ve viewed in the month of June.

Most of our clients or prospective clients have proactively called their credit card companies to let them know they will not be able to make payments and requested deferment and they were still marked as delinquent to the credit bureaus. Although, there have been instances when clients haven’t actively reached out and assumed they would be reported as current due to new federal guidelines, most of the errors in reporting actually come from instances in which the creditor was made aware of hardship and deferment.

Adem Selita, co-founder of The Debt Relief Company

In addition to this recurring credit reporting issue, Selita has been seeing something else with his clients that is resulting in damaged credit health.

Many consumers have seen their limit cut down to the utilized amount of credit. We’ve had a client with a $5,382 balance (prior to the pandemic the credit limit was $10,000), and as of June, the credit limit was slashed to $5,450. Essentially, this put the individual at a near 100% utilization on that particular line of credit and significantly decreased their total credit availability, so the hit to their credit score was two-fold.

This particular individual has never missed a payment and did not actually have to put any payments into deferral during the pandemic.

Adem Selita, co-founder of The Debt Relief Company

Selita went on to explain how another client had three separate credit card companies place his respective accounts in deferral, only to find that one marked his account 30 days late and the other two marked 60 days late.

Money Transfer Scams

There was also a 77% YOY increase in complaints categorized as “money transfer, virtual currency, or money service,” and Selita has had recent client experiences that could help explain this trend as well.

We have noticed a serious uptick in customers complaining about phishing scams related to Venmo & Zelle, fake text messages from banks, and calls from individuals trying to collect on debt they do not actually owe, etc.

Adem Selita, co-founder of The Debt Relief Company

Student Loan Complaints Drop

Interestingly, there was a substantial 41% YOY decrease in the number of student loan complaints, which may be due to the Department of Education placing all federal student loans in pandemic forbearance until September 30, 2020.

With no payments required and no student loan interest accruing until that date, borrowers may have put their student loan debt on the back burner.

No Matter the Product, Credit Report Issues Consistently Increased

For starters, it was no surprise to see many of the largest percent increases pertained to credit report issues. For example, there was a 168% YOY increase for the issue “problem with a credit reporting company’s investigation into an existing problem” under the sub-product “general-purpose credit card or charge card.”

There was a 109% YOY increase for the issue “incorrect information on your report” under the sub-product “credit reporting.” And even with many student loan issues experiencing a YOY decrease in complaints, the issue “problem with a credit reporting company’s investigation into an existing problem” under the sub-product “federal student loan servicing” still saw a 104% YOY increase.

From this data and the data from the first section, the biggest consumer finance problems since the beginning of the coronavirus pandemic have pertained to credit report issues. Specifically, a lack of chemistry between consumers, financial institutions, and the credit bureaus to properly manage the added deferments and adjusted payment plans.

Problems With CARES Act Debit Cards?

One particularly noteworthy trend that surfaced after taking a more granular look at the complaint data was the massive 506% YOY increase in complaints regarding the sub-product “government benefit card.”

Moreover, there was a 1790% YOY increase in complaints around the issue “problem getting a card or closing an account” under the aforementioned sub-product.

Why might this be?

As part of the massive government stimulus package in response to the coronavirus, adult Americans making less than $99,000 received a one-time government payment of up to $1,200. Some folks received this money via check or direct deposit, while others have received debit cards.

It’s been widely reported that the distribution of these debit cards has been a mess as some consumers can’t use the cards because the wrong name is printed, while others are mistaking the inconspicuous packaging the card comes in as junk mail and tossing or shredding their one-time payment.

Huge Increases Across-the-Board For Issues Related to “Money Transfer” Product

When it came to issues related to the product “money transfer, virtual currency, or money service,” there were consistently massive YOY increases.

For example, there was a 3067% YOY increase for the issue “problem adding money” under the sub-product “mobile or digital wallet.” There was a 900% YOY increase for the issue “confusing or misleading disclosures” under the sub-product “virtual currency,” and a 777% YOY increase for the issue “other service problem” under that same sub-product.

There was also a 150% YOY increase for the issue “fraud or scam” under the sub-product “check cashing service.”

As reported, the coronavirus pandemic has brought with it a number of phishing scams related to money transfers, in addition to fraudulent texts and calls from scammers impersonating banks trying to collect on debts.

Methodology

All data that can be found within this report derives from the Consumer Financial Protection Bureau’s (CFPB) consumer complaint database, which can be accessed here. The data for this report was pulled from that database on July 17, 2020.

Three separate date ranges were used when pulling the data, including from March 13, 2019, to July 17, 2019; November 7, 2019, to March 12, 2020; and March 13, 2020, to July 17, 2020. The total number of complaints in any of those date ranges might be different if the data was pulled today because the CFPB backdates complaints and adds them to the date ranges after the fact.

LendEDU did not make any edits or corrections to the CFPB database and reported it as is. For example, if a consumer mistakenly filed a complaint under the wrong sub-product, we did not correct this mistake as there was no way of verifying its accuracy. 

All complaints that are filed with the CFPB are sent to the financial institution that is named in the complaint. That institution is then given a period of time to respond to the complaint.

The percent increase calculations were completed by LendEDU with the numbers provided by the CFPB, while everything else is reported as it was pulled from the CFPB. For the final two tables, only the complaint categories that experienced the largest percent increases or decreases for both time periods analyzed were included in the tables.

This article, with additional date tables, was originally published in the LendEDU blog.

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Lexington woman opens new tax agency in her hometown; Valentine’s Day events planned

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TRU Tax office opens in Lexington

Sharicka Holloway Sides is planning a grand opening celebration on Jan. 30 for her recently opened TRU Tax office in Lexington.

The 2008 graduate of Lexington Senior High moved back to her hometown after a stint of living in Georgia to open her business at 364 Dixon St. The local agency opened in December.

“I moved back really because I got an offer to have my own agency, and a majority of my clients are in North Carolina,” she said. 

Shortly after high school, Sides began doing her own taxes and helping family members file their annual tax forms. She worked for various tax preparation companies in N.C. and Georgia during the next several years. TRU Tax began in Georgia, she said, and now has agencies in Texas, Georgia, Alabama, North Carolina and Ohio.

“I love to help people,” she said, explaining why she began working in the tax form preparation industry. “My company will be about modifying charges and getting you the most (refund) back as possible. We have so many tools to use. If I can lower your fee or help you get more refund than you did last year, I’m all for it.”

TRU Tax also has credit repair and accounting services. Sides’ Lexington office will concentrate on tax returns, however, and has 10 employees. She said she will refer clients to TRU Tax credit repair and accounting specialists if requested.

Managing a new TRU Tax agency in Lexington is not Sides’ only job. She is also working with her husband, Kevin Sides, to open Kitchen Konects, a catering company. She first opened a food catering business of the same name while living in Georgia. More information about this business venture will be given when the opening date is nearer.

Potential clients can reach Sides or her employees by downloading the My Tax Office app and using code 8925LA, or by calling or emailing (404) 721-3349 and sharickahtrutax@gmail.com.

Pictured are charcuterie boards made by Chef John Wilson of Sophie's Cork & Ale for the Arts Davidson County New Year's Eve fundraiser. The arts nonprofit and Wilson have teamed up again to offer charcuterie boards for Valentine's Day featuring sweet treats.

Charcuterie boards are back for Valentine’s Day

Arts Davidson County is bringing back its charcuterie board fundraiser, but this time with sweets and wine for Valentine’s Day celebrations at home during the pandemic.

The nonprofit staged a New Year’s Eve charcuterie board fundraiser where it partnered with local artists to make the boards and local restaurants to create the food and sell the wine. 

“We sold 89 boards for New Year’s Eve,” said Amanda Murphy, events and community coordinator for Arts Davidson County. ” We had a few boards left that we did not sell, so we wanted to do this again for Valentine’s. People loved it.”

While the first fundraiser partnered with a Lexington and Thomasville restaurant, the Valentine event will feature the mostly homemade treats of one Lexington restaurant. Chef John Wilson of Sophie’s Cork and Ale in Lexington will fill the handmade boards with Chocolate pretzel sticks, chocolate-covered strawberries, candied pecans, crunchy peanut butter buckeyes, s’mores Girl Scout cookies, pistachio brittle and Nutella marshmallow fluff.

 In addition, Wilson has also partnered with three other Lexington eateries to provide treats. Those treats and businesses are: Chocolate bombs from The Factory – Coffee & Waffles, doughnut holes from Red Donut Shop and swiss rolls from Sinfully Delicious Custom Bakery.

Purchasers will select from six wines when purchasing their charcuterie board at eventbrite.com. The cost is $50. Boards and wine will be ready for pick up at Sophie’s Cork & Ale, located at 23 W. Second Ave., from 3 to 5 p.m. Feb. 13.

“It’s important to us that we are supporting local businesses with our fundraiser,” Murphy said. “…We’re trying to say stay at home and be safe and stay healthy, but you can still support the businesses in our community.”

A Valentine dinner catered by Kathleen Watson of Cuisine Kathleen is planned for Feb. 13 at The Holt House.

Valentine date night dinners planned in small setting at Holt House

The owning partners at the Holt House have planned a Valentine dinner on Feb. 13 at the historic home in Lexington.

Nia Ward, one of three local women who purchased the home in March 2020 to operate it as a wedding and events venue, said she and her partners wanted to provide a way for people to still “go out” for Valentine’s Day but in a safe, socially-distanced way.

Timed, staggered seating will be provided for two to 10 people. Tables will be set up six feet or more apart in all the rooms on the house’s first floor. A party of six to 10 will be provided a private room. There is also an option to purchase a meal and take it home.

Kathleen Watson, owner of Cuisine Kathleen catering, is preparing the meal that features beef tenderloin, seasonal salad, potatoes au gratin, yeast rolls, flourless chocolate torte and a glass of beer or wine. The cost is $50 per person and includes a floral arrangement to take home.

Seating times from 5-7:30 can be made and tickets purchased at holthoucenc.com. Guests may enjoy their private table for up to 1 hour and 45 minutes. Afterward, guests may lounge by the outdoor fire pit and patio area. 

– Jill Doss-Raines is The Dispatch trending topics and personality profiles senior reporter and is always looking for tips about businesses and entertainment events, secret and new menu items, and interesting people in Davidson County. She wants to know what people in Davidson County are talking about. Contact me at jill.doss-raines@the-dispatch.com and subscribe to us at the-dispatch.com.

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How to Find a Credit Repair Company in New York

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Your credit score isn’t something you tend to give too much thought to – that is, until you need to borrow money, rent an apartment, or sign a car lease wherein it may require a credit check.

Suddenly, the fact that you may have missed a bill here and there, fallen behind on payments, and not worried too much about your credit score, will come back to haunt you.

For many people, bad credit can be scary, especially if you’ve never experienced it before. Having bad credit can negatively affect you in all kinds of ways, not just right now, but also in the future. The good news is that this doesn’t have to be a permanent situation, as there are ways you can go about fixing your credit. One of the most effective methods is to work with a credit repair company that understands exactly what steps you will need to take, and how to improve your rating as smoothly and quickly as possible.

So, if you’re looking for a credit repair company in New York and aren’t even sure what you should be looking for, let this act as your guidebook. Here we’ll outline all the most important steps in finding the perfect credit repair company in New York.

Look for a Company with Experience

The first thing to look out for is a company that has credit repair experience. Fixing your credit is a serious matter and not something you want to make mistakes with. This means you need a company that has a proven track record of helping clients, and one that can show real results.

Does the Company Offer a Guarantee?

Besides experience, it’s also wise to ask if the company offers a guarantee on their services. Ideally, it should be a money back guarantee should they not be able to follow through no their promise or guarantee. In other words, they are unable to fix your credit score.

Does the Company Offer a Free Consultation or Evaluation?

It’s also important to look for a company that approaches each case or client on an individual basis. What works for one person may not be the best solution for you. Ask the company in advance if they offer any type of free consultation or evaluation. This gives you a chance to get an idea of the approach they would take, and you can then make a decision if it matches with your needs and wants.

How Long Will it Take to Fix Your Credit?

Any reputable credit repair company should be able to look at your current credit rating, your personal situation, and then give you a rough estimate on how long the process should take. Will it be weeks, months, a year? It’s important to get a realistic idea of what you can expect going forward. Some companies will even offer real-time status updates, which can give you peace of mind knowing that they are working to remedy your credit rating.

Ask What is Needed Of You

While the credit repair company will be doing all the hard work, you will still have a role to play. Make sure to ask what will be expected and needed of you in order for the process to move along smoothly.

What Is the Customer Support Like?

Because you aren’t an expert yourself when it comes to credit repair, there is no doubt you’ll have questions here and there. It’s important to research what the level of customer support is should you have concerns, issues, or questions that you need assistance with.

Inquire Into Various Plans

Here’s a tip you may not think of right away, but it may be helpful. Sometimes it’s not a matter of a credit rating for a single person, rather you need assistance as part of a couple. You can find a robust Couples Plan at Pyramid, a reputable credit repair company. The Couples Plan is actually Pyramid’s most popular plan and boasts a personalized service for two people and specific finance tools for couples, among other features and benefits. It’s a great way to take action as a couple and get some really positive results.

What Will the Company Need from You?

In order to do their job, the credit repair company will need documentation from you, so make sure you are given a list of all the essential items you need to gather. Without all the necessary documents they may not be able to successfully repair your credit score. This is why it’s so important to be keeping careful records at home.

When you do gather all the material for the company, they should also never ask you to lie. Even if it’s not a bold-faced lie, a misleading statement shouldn’t be used either.

Do You Have to Sign a Contract?

While some companies may try to rope you into a contract, there is no reason you have to go with them. Instead, look for a company that doesn’t have contracts or commitments so that you can feel free to leave if you’re not happy.

Asking for Full Payment Up-Front

Another red flag can be a company that asks for full payment up-front. As experts state, these are companies you want to steer far away from.

Read Online Reviews from Other Clients

Finally, you want to take a look at online reviews about any company you are considering using. Although online reviews need to be taken with a grain of salt, they can offer some helpful insight and help to ensure you make an informed decision.

Besides online reviews, you can speak to family and friends who may have worked with a credit repair company in the past and get their insight on the experience they had – both good and bad.

Finding the Company That Will Help You

While it may seem like a lot of things to be mindful of as you look to hire a credit repair company, the fact is that you want your credit score to be repaired quickly and properly, so choosing the right company is key.



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Mick Foley debuts new hairstyle inspired by Patrick Mahomes

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WWE Hall Of Famer Mick Foley appears to be keeping busy with commercials for national brands.

Foley debuted a new hairstyle on Twitter while promoting State Farm insurance. As seen below, it looks like he has shaved the sides of his head to match Mahomes’ hairstyle.

Foley said he was looking for State Farm’s “Patrick price” but his son, Dewey, informed him that everyone gets the same great rate at State Farm. Check out Mick’s response in the clip below.

On a related note, Mick also recently did an ad for Lexington Law Group credit repair company so perhaps there is a future for him as a spokesman.



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