Nearly 15% of all Americans show at least one item in collection on their credit report, and the average amount of debt in collection is $1,400. Debt collection is a $12.2 billion industry in the United States. Banks and other creditors may collect their own debt, and they can also sell off debt to third parties, which can also choose to collect the debt or sell it off. As a result, it is not surprising that debt collectors sometimes engage in practices that intimidate and harm consumers.
Many debt collection companies play by the rules and treat consumers fairly, but those that don’t can wreak havoc on your finances. Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, all covered persons or service providers are legally required to refrain from committing unfair, deceptive or abusive acts or practices. Any entity that is not the original creditor is subject to the Fair Debt Collection Practices Act and is also legally required to refrain from committing unfair, deceptive or abusive acts or practices in the attempted collection of a consumer debt.
But what kinds of debt-collection practices should you be wary of? The following practices are typically deemed to be illegal.
“I didn’t realize all that was involved with the home buying process, but that has changed by taking this class.”
“More helpful than other homebuyer classes I’ve taken.”
“The best $15 I ever spent.”
We love getting this feedback on the evaluations of our Homebuyer Education Courses. It means we’re succeeding in making sure people enter into homeownership with all the knowledge they need to be successful and to sustain their investment for the long-term. (And yes, our classes are just $15.)
A recent study by NeighborWorks (of which Avesta Housing is a chartered member) found that buyers who go through a pre-purchase counseling program are one-third less likely to fall behind on their mortgage in the first two years of homeownership.
Bri and her fiancé, Chris, recently took the class and used what they learned to buy their first home in Gorham. Here’s what Bri had to say about her experience.
How did you hear about the Homebuyer Education Class?
We got a housing loan through USDA Rural Development and it was a requirement to take this class to get our home mortgage loan. We’re glad it was. 🙂
What did you learn at…
Read More »
Interest rates are at a record low, but many borrowers are still reluctant to shop for the best mortgage loan – a decision that could cost them money.
Looking at data from the November 2012 National Housing Survey, Fannie Mae researchers found that close to half of lower-income mortgage borrowers said they did not obtain more than one quote when signing up for their current mortgage.
Comparatively, three out of four higher-income respondents explored competitive offers and said better deals would definitely have an influence on their decisions.
“Although a home purchase is the largest financial obligation most people will ever make, many borrowers do not fully understand their mortgage products and costs,” said Fannie Mae chief economist Doug Duncan. “As a result, some homeowners in this position may find themselves with unsustainable payments down the road.”
Fannie Mae reported that failing to shop around for a mortgage can end up costing borrowers $1,000 or more in closing costs.
As a housing counselor, it’s my job to educate people on the importance of comparative shopping. I encourage clients to attend first-time homebuyers’ workshops as well as one-on-one pre-purchase and…
Read More »
As we’ve done in the past, Avesta is spreading the word about free tax preparation services available for households who need them. Families are fortunate that there are so many ways to get free tax help instead of paying someone to file your taxes, or, worse, getting a refund anticipation loan that carries excessive fees and ridiculous interest.
We’re partnering with Gorham Savings Bank and the United Way to sponsor a week of free tax preparation events beginning today. IRS-certified tax preparers will be on hand to help you prepare and file your taxes, check your credit report, and apply for Maine’s property tax and rent refund programs. The events are February 26-28 from 5-8 p.m. and Saturday, March 2, from 9 a.m.-2 p.m., happening at United Way’s office at 1 Canal Plaza, third floor. They’re available to people who made less than $51,000 in 2012.
If you can’t make it to an event, you can stop by our new HomeOwnership Center any time during tax season. Contact me to find out more or make an appointment. The United Way is also open to help, so give them a…
Read More »