Division of Finance and Corporate Securities Financial Predatory

Division of Finance and Corporate Securities Financial Predatory Practices Diane Childs Financial Information Outreach Coordinator 1

Division of Finance and Corporate Securities Our Programs Ø Debt Management Ø Financial Institutions Ø Lending – Payday & Ø Pre Need Consumer Finance Ø Money Transmitters Ø Pawnshops Ø Securities Ø Mortgage Lenders Ø Identity Theft 2

Division of Finance and Corporate Securities What we do 3

Division of Finance and Corporate Securities Submitting a complaint 4

Division of Finance and Corporate Securities Check and Verify License or Registration 1 -866 -814 -9710 www. dfcs. oregon. gov 5

Division of Finance and Corporate Securities Debt Management Companies Assist with: • Debt • Credit repair • Loan modification • Bankruptcy (how to) • Financial education 6

Division of Finance and Corporate Securities Allowable Fees ü Maximum counseling, agreement fee: $50 ü Maximum monthly fee: $65 ü 7. 5% charge = total amount of reduced debt (debt settlement, loan mods, short sale) 7

Division of Finance and Corporate Securities Loan Modifications ü Similar fee structure 0 Free Help: HUD-certified foreclosure counselors 1 -800 -SAFENET www. foreclosurehelp. oregon. gov 8

Division of Finance and Corporate Securities Red Flags Debt Management • Settling for "pennies on the dollar" • No adverse affect on credit ratings • Don’t pay creditors • Upfront fees 9

Division of Finance and Corporate Securities Red Flags Loan Modification • Stop making mortgage payments • Mortgage payment to hired company • Ads, mailings similar to government • Performs “forensic audit” 10

Division of Finance and Corporate Securities Combined Red Flags • Upfront fees • Solicitations: email, phone or Internet pop-up ads • Guarantees positive results • Out-of-state attorneys (no registration needed) 11

Division of Finance and Corporate Securities State of Oregon Licensed Privileged and Confidential File Number, Notice …tri-bureau credit report…owe combined total of $28, 589 Call Now…eligibility expires Portland Office 12

Division of Finance and Corporate Securities Actual rates charged 950% 90% 2737% 343% 800% 13

Division of Finance and Corporate Securities Legal Payday Loan Rates ü 36% annual percentage rate (APR)* ü One time origination fee ü No renewal fees ü Restrictions on additional loans *Interest, Fees – 154% if lender charges maximum rate, fees 14

Division of Finance and Corporate Securities Legal Consumer Loan Rates ü 36% annual percentage rate (APR) ü No origination fees ü No “bump up” to higher rate 15

Division of Finance and Corporate Securities Predatory Tactics Get cash now! No credit check! Bad credit? No problem! 16

Division of Finance and Corporate Securities Identity Theft Tactics 17

Division of Finance and Corporate Securities Check and Verify License 1 -866 -814 -9710 www. dfcs. oregon. gov 18

Division of Finance and Corporate Securities Cease-and-Desist • No license • Excessive interest rates: 89% - 342% • $17, 500 penalty • Stop collection activity 19

Division of Finance and Corporate Securities Check and Verify Check License or Registration Know legal fees, charges, interest rates Contact us: 1 -866 -814 -9710 www. dfcs. oregon. gov 20

Division of Finance and Corporate Securities More Information 1 -866 -814 -9710 www. dfcs. oregon. gov 21