Should you go for a Fixed or Variable Rate Mortgage? #bankrate #mortgage #rates


#variable rate mortgage

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Contact moneysupermarket.com at Moneysupermarket House, St David’s Park, Ewloe, Flintshire, CH5 3UZ. Moneysupermarket.com Ltd 2013

Moneysupermarket.com Limited is an appointed representative of Moneysupermarket.com Financial Group Limited, which is authorised and regulated by the Financial Conduct Authority (FCA FRN 303190). Moneysupermarket.com Financial Group Limited, registered in England No. 3157344. Registered Office: Moneysupermarket House, St. David’s Park, Ewloe, CH5 3UZ. Telephone 01244 665700

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Will Obama s latest mortgage refinance plan help you? CBS News #mortgage #rates #today


#obama mortgage

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Will Obama’s latest mortgage refinance plan help you?

Will Obama’s mortgage refinance plan help you?

Dean Baker of the Center for Economic and Policy Research sits down with CBSNews.com deputy politics editor Corbett B. Daly to discuss the ins an.

President Obama on Monday announced new measures to help borrowers refinance their existing mortgages to new loans with lower interest rates and cheaper monthly payments.

The plan is an expansion of an existing program to help borrowers who are not behind on their payments but cannot refinance because they do not enough equity in their home. Or they might be underwater–which means they owe more than their home is worth.

“Right now, some underwater homeowners have no choice but to refinance with their original lender – which some lenders refuse to do,” Obama said in prepared remarks.

“These changes will encourage other lenders to compete for their business by offering better terms and rates, and eligible homeowners to shop around for the best ones,” he added.

But how many homeowners will it really help? And will it be enough to jumpstart the still struggling housing market?

Dean Baker is the Co-Director of the Center for Economic and Policy Research here in Washington, spoke with CBS News and said if 800,000 borrowers are able to refinance, that would be “very good.”

That would be a big help to those borrowers, but probably not enough to make much of a difference in the overall economy, he added.

Despite the relatively modest effect, Mr. Obama and his team recognize the president needs to be seen on television everyday as someone “trying to solve problems, said Larry Sabato, a politics professor at the University of Virginia.

“It’s a smart approach and long overdue,” Sabato said, noting that the administration is “out of time” as the presidential election is just a year away.

“They realize that Obama probably can’t get a Mother’s Day resolution passed through Congress,” so he has to move ahead with incremental measures that help pockets of Americans.

Housing analyst Edward Pinto stressed that the plan would mostly help borrowers who owe less than their mortgage, despite the repeated talked from White House officials that it is aimed at so-called “underwater” borrowers.

“I think it’s important not to get expectations up too high,” said Pinto, a fellow at the conservative American Enterprise Institute and a vocal critic of Fannie Mae and Freddie Mac, the two government sponsored entities that are backing the loans eligible for refinance under the Home Affordable Refinance Program (HARP).

Pinto noted close to a million borrowers have gotten a HARP refinance loan since it was introduced two years ago, but only about 100,000 of them were borrowers who owed more than their house is worth. Without the HARP program, borrowers would have to owe less than 80 percent of the loan’s value to refinance, so the majority of borrowers who got new HARP loans were in that 80 to 100 percent range, Pinto said.

Even with the expanded program, “they are not going to help a million” more underwater borrowers, Pinto added.

2011 CBS Interactive Inc. All Rights Reserved.


What Happens If You Default on a Second Mortgage? #mortgage #interest


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What Happens If You Default on a Second Mortgage?

If you have a second mortgage on your home and fall behind in payments, the second mortgage lender may or may not foreclose, depending on the value of your home. Read on to find out what happens if you stop making payments on a second mortgage and when that lender may decide to initiate a foreclosure.

(To learn the ins and outs of the foreclosure process, and foreclosure procedures in your state, visit our Foreclosure Center .)

Second Mortgages and Lien Priority

A second mortgage is a loan you take out using your house as security that is junior to another mortgage (a first mortgage). A few common examples of second mortgages are home equity loans and home equity lines of credit (HELOCs).

A senior lien, such as a first mortgage, takes priority over a junior lien, such as a second mortgage. Priority determines which lender gets paid before other lenders.

Priority Is Determined by the Recording Date

Generally, priority is determined by the date the mortgage or other lien is recorded in the county land records (though some liens, such as property tax liens, have automatic superiority over essentially all prior liens). First mortgages are, as the name suggests, typically recorded first and are then in first lien position. Second mortgages are usually recorded next and are therefore in second position. Judgment liens, if there are any, are often junior to a first mortgage and possibly a second mortgage, as well as perhaps other judgment liens previously filed by other creditors. (Learn more about when a creditor is allowed to place a lien on your property .)

What Happens to a Second Mortgage’s Priority if You Refinance the First Mortgage?

If you refinance your first mortgage, that lender will require the second mortgage lender to execute a subordination agreement. In a subordination agreement, the second mortgage holder consents to subordinating its loan to the refinanced loan. The subordination agreement allows the refinanced loan (the newest loan), which would be junior based on the recording date, to jump ahead in line and take the place of the first lender in terms of priority.

What Happens When You Default on a Second Mortgage?

A lender can choose to foreclose when a borrower becomes delinquent on its mortgage, whether the mortgage is a first or a second mortgage. If you default on your first mortgage, that lender will very likely begin foreclosure proceedings. If, on the other hand, you default on a second mortgage, whether or not that lender initiates a foreclosure will depend mainly on the current value of your home.

(To learn about the foreclosure process in your state, check our Summary of State Foreclosure Laws .)

Homes With Equity

If you have equity in your home (this happens when the value of your home is greater than the amount you owe on your first mortgage), your second mortgage is at least partially secured. When you fall behind in payments on the second mortgage, the second mortgage holder will probably initiate a foreclosure because it will recover part or all of the money it loaned to you once the property is sold at a foreclosure sale. The more equity there is in the property, the greater the likelihood that the second mortgage holder will foreclose.

Underwater Homes

If your home is underwater (this happens when the value of your home is less than the amount you owe on your first mortgage), your second mortgage is effectively unsecured. This means that if the second mortgage holder were to foreclose, there wouldn’t be enough proceeds from the foreclosure sale to pay anything to that lender.

In most cases, if you’re underwater and fall behind on payments for your second mortgage, the holder of the second mortgage will probably not start a foreclosure since all the proceeds from the foreclosure sale would go to the senior lender. However, the junior lender could still sue you personally for repayment of the loan.

Lawsuits From Lenders on Second Mortgages, HELOCs, and Other Junior Lienholders

Even if the second mortgage holder decides not to foreclose, that lender can sue you to recover the money it loaned you. This commonly happens after the first mortgage holder forecloses (though it could happen sooner). In a first-mortgage foreclosure, any junior liens (these would include second mortgages and HELOCs, among others) are also foreclosed and those junior lienholders lose their security interest in the real estate. This is referred to as a “sold-out junior lienholder.”

Sold-out junior lienholders. When a junior mortgage holder has been sold-out in a first-mortgage foreclosure, that junior mortgage holder usually can, depending on state law, sue you personally on the promissory note to recover the money. (Learn more in Nolo’s article What Happens to Liens and Second Mortgages in Foreclosure? )

How second mortgage holders collect from you. If the junior lender wins the lawsuit and gets a money judgment against you, generally the lender may collect this amount by doing such things as garnishing your wages or levying your bank account. (Learn about methods that creditors can use to collect judgments .)

Filing for bankruptcy may provide some relief. A bankruptcy can reduce or eliminate this type of debt. (For more articles on bankruptcy, including bankruptcy basics, bankruptcy procedures, and specific information about filing bankruptcy in your state, visit our Bankruptcy topic area.)

Options to Avoid to Foreclosure

If you are struggling to make your first and/or second mortgage payments, your home is underwater, or foreclosure is imminent, visit our Alternatives to Foreclosure area.


Help with mortgage costs if you – re out of work – Citizens Advice #reverse


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Help with mortgage costs if you’re out of work

Table of contents

Help with mortgage costs if you’re out of work

If you’re struggling to pay your mortgage because you’re out of work, you must take action quickly to stop yourself from falling into debt.

If you get into debt and your lender thinks you’re not dealing with the problem, they will take action through the courts. This could lead to you losing your home.

If you’re not working, you may be able to get certain benefits which give help towards your mortgage costs.

On this page we tell you:

If you aren’t entitled to one of these benefits, you might be able to get other help. See More options for dealing with mortgage problems .

If you’ve already fallen into debt with your mortgage payments, there may be things you can do to stop yourself from falling further behind with your payments and to clear the debt. See How to deal with mortgage debts .

If you’re having serious difficulties paying your mortgage, for example, if you’ve started getting letters from your mortgage lender threatening court action, you should get help from an experienced debt adviser.

You can get debt advice from a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by e-mail, click on nearest CAB .

Which benefits give help towards mortgage costs

The following benefits give you some help towards your mortgage costs:

  • Income Support. This is help for lone parents or carers
  • Income-based Jobseeker’s Allowance (JSA). This is help for people who are looking for work
  • Pension Credit. This is help for people who are over 60 and on a low income
  • Income-related Employment and Support Allowance (ESA). This is help for people who are too sick or disabled to work.

For more information about whether you may be entitled to one of these benefits and how to make a claim, see the following pages:

How much of your mortgage costs can be paid

When you make a claim for one of the benefits mentioned on this page, you will be told whether you can get help towards your mortgage costs. This help is known as housing costs payments.

Housing costs payments contribute towards the cost of the interest payments on your mortgage. They may also contribute towards the interest payments on loans taken out to pay for repairs or home improvements. Housing costs payments can’t be used to pay off any of the capital of your mortgage.

Housing costs are paid at a standard rate of interest, regardless of the rate of interest you are actually paying.

This means that although there can be cases where housing costs payments are higher than the interest you have to pay, in many cases, the payments will be lower. You will have to make up any difference between the interest due to the lender and the amount of interest covered by the housing costs payments. However, if you can’t afford to make up the difference, it might be worth asking your lender if they will just accept the housing costs payments for the time being until you can make up the full amount at a later date.

For more information about how to deal with your mortgage lender, see Dealing with your mortgage lender .

You might want to get an experienced debt adviser to help you deal with your mortgage lender. You can get help from your local Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB .

Can you get your mortgage costs paid straight away

When you make a claim for benefits, you will usually have to wait 39 weeks before housing costs are paid. This is a change to the previous waiting period of 13 weeks and applies to claims made from 1 April 2016.

If you’re entitled to Guarantee Pension Credit, there is no waiting period and you can get housing costs payments straight away.

More options for dealing with mortgage problems

If you aren’t entitled to any of the benefits which give help towards your mortgage costs, other help might be available.

For more information about your other options, see the following pages:

This advice applies to England

Advice can vary depending on where you live.


What a mortgage lender will lend you – How to get the best mortgage deal


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How to get the best mortgage deal What a mortgage lender will lend you

Mortgage deals let you borrow up to a percentage of the property’s value

Find out what percentage of a property’s value you’re likely to be able to borrow when you take out a mortgage.

Lenders use affordability calculations to figure out what they will lend to you. This involves them looking at your income and outgoings to work out how much you can afford to pay back.

This will typically work out to be between three and five times your income – although they will also look at other things such as whether you would still be able to afford the loan if interest rates increased.

You can visit the mortgage calculators offered by Which? Mortgage Advisers, our impartial mortgage broking service. to get an idea of what you will typically be able to borrow from a mortgage lender.

  • Call Which? Mortgage Advisers on 0808 252 7987 for personal, impartial advice on the best mortgage deal for your personal circumstances

What percentage can you borrow?

The ‘loan-to-value’ or LTV is the amount you are borrowing in relation to the cost of the property you are buying. It’s expressed as a percentage of the property’s value. So, if you are buying a property for £200,000 and borrowing £180,000, your LTV is 90%.

All deals allow borrowing up to a maximum LTV – 75% or 90%, for example. In general, the lower your LTV, the lower the mortgage rate and the cheaper the deal overall you will be able to get.

Go further: Which? Money Compare tables – compare some of the best deals on the market

Higher-lending charges

If you’re putting down a deposit of 25% or less, you might have to pay a higher-lending charge (HLC), which can amount to hundreds or even thousands of pounds.

These charges are typically used by the lender to buy insurance to protect itself against you defaulting on your repayments. They usually apply to high-LTV mortgages as the higher the LTV, the more likely it is that you will default. However, most lenders no longer charge them.

HLCs are normally calculated as a percentage of the portion of the loan in excess of 75% of the property’s value. So, if you are borrowing £180,000 to buy a house costing £200,000 (90% LTV), you’ll pay an HLC on £30,000.

A typical charge might be 6% of this amount so you would pay £1,800.

You should factor in the cost of higher-lending charges when choosing your mortgage. Avoid adding the charge to your mortgage, if possible, as you will end up paying interest on it for the life of the loan.

For more on mortgage fees. see the next page of this guide.

Need a mortgage?

Working out how much a mortgage lender will lend you can be tricky and will be based on your personal circumstances.

Our independent mortgage advice service, Which? Mortgage Advisers. takes the time to understand your circumstances and guide you through the whole journey to make it as stress free as possible. Call one of our expert advisers on 0808 252 7987 .

More on this.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Which? Limited (registered in England and Wales number 00677665) is an Introducer Appointed Representative of Which? Financial Services Limited (registered in England and Wales number 07239342). Which? Financial Services Limited is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited. Registered office: 2 Marylebone Road, London NW1 4DF.

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Is an Adjustable Rate Mortgage (ARM) Is Right for You? #50 #year #mortgage


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Is an Adjustable Rate Mortgage (ARM) Is Right for You?

What is an Adjustable Rate Mortgage?

An adjustable rate mortgage. called an ARM for short, is a mortgage with an interest rate that is linked to an economic index. The interest rate, and your payments, are periodically adjusted up or down as the index changes.

ARM Terminology

An index is a guide that lenders use to measure interest rate changes. Common indexes used by lenders include the activity of one, three, and five-year Treasury securities, but there are many others.

Each ARM is linked to a specific index.

Think of the margin as the lender s markup. It is an interest rate that represents the lender s cost of doing business plus the profit they will make on the loan. The margin is added to the index rate to determine your total interest rate. It usually stays the same during the life of your home loan .

The adjustment period is the period between potential interest rate adjustments.

You may see an ARM described with figures such as 1-1, 3-1, and 5-1. The first figure in each set refers to the initial period of the loan, during which your interest rate will stay the same as it was on the day you signed your loan papers.

The second number is the adjustment period, showing how often adjustments can be made to the rate after the initial period has ended. The examples above are all ARMs with annual adjustments–meaning adjustments could happen every year.

If my payments can go up, why should I consider an ARM?

The initial interest rate for an ARM is lower than that of a fixed rate mortgage. where the interest rate remains the same during the life of the loan. A lower rate means lower payments. which might help you qualify for a larger loan.

How long do you plan to own the house?

The possibility of rate increases isn t as much of a factor if you plan to sell the home within a few years.

Do you expect your income to increase? If so, the extra funds might cover the higher payments that result from rate increases.

Some ARMs can be converted to a fixed-rate mortgage. However, conversion fees could be high enough to take away all of the savings you saw with the initial lower rate.

ARM Indexes

While you can t dictate which index a lender uses, you can choose a loan and lender based on the index that will apply to the loan. Ask the lender how each index used has performed in the past. Your goal is to find an ARM that is linked to an index that has remained fairly stable over many years.

When comparing lenders. consider both the index and the margin rate being offered.

Discounted Rates and Buydowns

When you re buying a home you might encounter sellers who offer to pay a buydown fee that allows the lender to offer you an initial rate that s lower than the sum of the index and the margin.

New home builders sometimes offer that type of purchase package to help get people into their homes.

The buydown rate will eventually expire and your payments could rise significantly if an ARM rate is adjusted upwards at the same time the discount expires.

Keep in mind that sellers sometimes raise the price of a home by the amount they pay to buydown your loan. The extra cost may in time override any savings from the initial discount.

Interest Rate Caps

Rate caps limit how much interest you can be charged. There are two types of interest rate caps associated with ARMs.

  • Periodic caps limit the amount your interest rate can increase from one adjustment period to the next. Not all ARMs have periodic rate caps.
  • Overall caps limit how much the interest rate can increase over the life of the loan. Overall caps have been required by law since 1987.

Payment Caps

A payment cap limits how much your monthly payment can increase at each adjustment. ARMs with payment caps often do not have periodic rate caps.

Carryovers

If an interest rate cap held your interest down at an adjustment even though the index went up, the amount of the increase can be carried over to the next adjustment period.

Beware of Negative Amortization

Amortization takes place when payments are large enough to pay the interest due plus a portion of the principal.

Negative amortization occurs when payments do not cover the cost of interest. The unpaid amount is added back to the loan, where it generates even more interest debt. If this continues you could make many payments, but still owe more than you did at the beginning of the loan.

Negative amortization generally occurs when a loan has a payment cap that keeps monthly payments from covering the cost of interest.

Lenders are required to give you written information to help you compare and select a mortgage. Don t hesitate to ask as many questions as it takes to help you understand every aspect of ARMs and other home loans that are offered to you.

Get the Facts About Adjustable Rate Mortgages

What Are the Risks of an Adjustable Rate Mortgage? Reducing Your Risks Consider the following issues before accepting an ARM.

Discounted Rates – Buydowns
Sellers sometimes pay a fee that allows the lender to offer you an initial rate that s lower than the sum of the index and the margin. The buydown rate will eventually expire.

  • The Double Whammy
    Your payments can rise significantly if your rate is adjusted upwards at the same time the discount expires.
  • Is a Discounted Rate Worthwhile?

Sellers may raise the price of a home by the amount they pay to buydown your loan. The extra cost may in time override any savings from the initial discount.

Interest Rate Caps

Rate caps limit how much interest you can be charged. There are two types of interest rate caps associated with ARMs.

  • Periodic caps limit the amount your interest rate can increase from one adjustment period to the next. Not all ARMs have periodic rate caps.
  • Overall caps limit how much the interest rate can increase over the life of the loan. Overall caps have been required by law since 1987.

Payment Caps
A payment cap limits how much your monthly payment can increase at each adjustment. ARMs with payment caps often do not have periodic rate caps. Carryovers
If an interest rate cap has held your interest down even though the index went up, the amount of the increase can be carried over to the next adjustment period.

Negative Amortization
Amortization takes place when payments are large enough to pay the interest due plus a portion of the principle.

  • Negative amortization occurs when payments do not cover the cost of interest. The unpaid amount is added back to the loan, where it generates even more interest debt. If this continues you could make many payments, but still owe more than you did at the beginning of the loan.
  • Negative amortization generally occurs when a loan has a payment cap that keeps monthly payments from covering the cost of interest.
  • Negative amortization does not have as much of an impact when real estate is appreciating nicely, so the lower payments may be more attractive to you than paying down the principle.

Lenders are required to give you written information to help you compare and select a mortgage. Don t hesitate to ask as many questions as it takes to help you understand every aspect of your loan


Should you go for a Fixed or Variable Rate Mortgage? #mortgage #payment #calculator


#variable rate mortgage

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Contact moneysupermarket.com at Moneysupermarket House, St David’s Park, Ewloe, Flintshire, CH5 3UZ. Moneysupermarket.com Ltd 2013

Moneysupermarket.com Limited is an appointed representative of Moneysupermarket.com Financial Group Limited, which is authorised and regulated by the Financial Conduct Authority (FCA FRN 303190). Moneysupermarket.com Financial Group Limited, registered in England No. 3157344. Registered Office: Moneysupermarket House, St. David’s Park, Ewloe, CH5 3UZ. Telephone 01244 665700

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Cash Call Mortgage Reviews: What You Need to Know #mortgage #calculatr


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Cash Call Mortgage Reviews: What You Need to Know

Since the lead-up to the housing bubble in the mid-2000s, the mortgage industry has been dominated by direct-to-consumer mortgage originators offering lower rates and a streamlined underwriting process. As the housing market heated up, homebuyers were pressed into obtaining a quick lock on their rates and a fast turnaround on their applications, which was what these new mortgage companies advertised. For many homebuyers, the only thing that matters is getting the lowest possible rate. This is especially true in markets such as southern California, where the cost of home ownership is among the highest in the country. Chances are, if you live in or visit southern California and listen to the radio at night, you have heard the radio commercials touting a “no closing cost mortgage” by CashCall Mortgage, a division of CashCall Inc. Founded in 2003, CashCall Mortgage is among the top 30 mortgage originators in the country.

About CashCall Mortgage

CashCall Mortgage, an Orange, California-based company, operates as a centralized call center, taking loan applications directly from consumers or through the Internet. As a direct-to-consumer loan originator, the company offers a streamlined application and lending process, which reduces its costs. The savings are passed on to its customers in the form of lower interest rates. In 2015, CashCall Mortgage was acquired by Impac Mortgage Holdings Inc. (NYSE: IMH ), an Irvine, California-based mortgage originator founded in 1995. The acquisition ranks Impac Mortgage in the top 20 mortgage lenders in the country. CashCall Mortgage continues to operate as a separate division under its original name.

Mortgage Products Offered

CashCall Mortgage offers a full range of loan products, including 10-, 15-, and 30-year fixed-rate mortgages. For each of its fixed-rate loan products, the company offers a zero closing costs version on refinances. Rates on the zero closing cost loans are slightly higher than the standard version, but there are no upfront closing costs to be paid. That includes the cost of an appraisal, which is paid by CashCall Mortgage.

CashCall Mortgage also offers no closing cost jumbo loans over $417,000, and a Do Over Refinance for owner-occupied borrowers who funded a loan elsewhere in the last 18 months. For the Do Over Refinance, borrowers must provide a copy of their mortgage statement with the current fixed loan rate and mortgage term. CashCall will then offer a lower fixed rate with no closing costs, although it may come with a shorter mortgage term. The loan must fund within 30 days of the application.

Mortgage Rates

CashCall Mortgage offers several options for each of its fixed-rate loans, including a zero-cost Roll Down option, a flat $995 lender fee and two-point options.

As of May 7, 2016, the rates on the company’s 30-year fixed loan were 3.50% for a Roll Down, 3.50% for a flat lender fee, 3.375% for 0.50 points, and 3.25% for 1.25 points.

For 15-year fixed loans, the rates were 2.875% for a Roll Down, 2.875% for a flat fee, 2.750% for 0.25 points and 2.625% for 0.50 points.

For 10-year fixed loans, the rates were 2.875% for a Roll Down, 2.75% for a flat fee, 2.625% for 0.25 points and 2.50% for 1.0 points.

What Consumers Are Saying

CashCall Inc. has 204 complaints filed with the Better Business Bureau (BBB), but the vast majority of them involve the company’s consumer loan division, which has come under fire from a number of states for illegal advertising and lending practices. Reviews for its mortgage loans found on review sites such as Yelp are mixed, with about two-thirds giving five stars and one-third giving one star. Most of the reviews, both positive and negative, centered on the company’s underwriting process and customer service.

People who had a favorable experience touted the easy application process and quick turnaround, while those with an unfavorable experience complained that the process was convoluted and slow. It appears that the difference in experiences came down to the particular agent with whom they worked. The company either earned high praise for competence and customer service or criticism for poor service and indifference.


Cash Call Loan Default – SHOULD YOU REPAY? #what #is #the #mortgage #rate #today


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Repay Your CashCall or Western Sky Loan?

I have a loan with a company called Cash Call that I am behind on, they are not willing to work with me. What are my options?

My question is I have a loan with a company called Cash Call that I am behind on two months actually and I have tried to call and make arrangements with them and they are not willing to work with me. What is the minimum amount of money I could send them to where they could not garnish my wages? I did contact a lawyer and wanted to file bankruptcy and I did previously in 2000 they said because it has not been 7 years I would have to wait until next May 08. I am not denying the fact that I owe the money I am just in a bad situation and want to try and just deal with there harassment until next may. If you could please let me know what I will need to do I would appreciate it.

Read full question

Published: Nov 7, 2007 Updated: Dec 18, 2013

  • Loans from Cash Call and Western Sky are similar to payday loans.
  • Internet loans are among the highest-interest consumer loans available.
  • The CFPB filed a lawsuit against CashCall and Western Sky in December 2013.

CashCall and its affiliate Western Sky lend from $850 to $10,000 to consumers with rates ranging from 90% to 343%. A typical CashCall or Western Sky loan of $10,000 costs more than $60,000 to repay, and a $2,600 loan will cost you $13,840 over a 4-year period.

New York Settles with CashCall Western Sky

Source: NY Attorney General

In January 2014, the New York attorney general announced New Yorkers need to repay only the principal (and not interest) on their Western Sky and CashCall loans. New Yorkers who repaid more than the principal plus the legal interest rate of 16% should apply for a refund with the refund administrator .

According to studies by consumer groups, these high-interest loans are pitfalls for consumers. Due to their high rates and fees, studies find that borrowers are better off avoiding the loans, and working out a payment plan directly with the creditor they want to pay with the high-interest loan.

If you default on a CashCall or Western Sky loan, it can, in theory, take the same action as any other unsecured creditor to enforce a defaulted debt. Collection efforts will start with telephone calls, letters and e-mails demanding you pay the balance of the loan. If CashCall or Western Sky refers your accounts to a collection agency such as Delbert Services Corp. you can stop the telephone calls by sending a cease communications letter. commonly called a cease and desist notice. The federal Fair Debt Collections Practices Act (FDCPA) states that collection agents must stop calling you when you notify them in writing to do so.

CFPB Sues CashCall

In December 2013, the federal Consumer Financial Protection Bureau (CFPB) filed lawsuits against CashCall and its two subsidiaries Western Sky Financial and Delbert Services Corp. for unfair, deceptive, and abusive practices, including illegally debiting consumer checking accounts for loans that were void.

The CFPB alleges CashCall and Western Sky loans violated licensing requirements and/or interest-rate caps in eight states, including Arizona, Arkansas, Colorado, Indiana, Massachusetts, New Hampshire, New York, and North Carolina.

The CFPB wants CashCall to issue refunds to borrowers and pay penalties.

If CashCall or Western Sky cannot convince you to pay through standard collection tactics, such as phone calls, it may decide to file a lawsuit against you to obtain a judgment for the balance of the debt. If CashCall or Western Sky sues and obtains a judgment against you, it can then take steps to enforce the judgment as allowed by your state law. The most common methods of enforcing a judgment are wage garnishment, bank account levies, and property liens.

Most lenders do not sue debtors to collect debts. A lawsuit is a worst-case scenario, which you will probably not experience. However, take a moment to learn your state s collection laws so you are aware of what actions your state allows.

Repay a CashCall or Western Sky Loan?

In December 2013, the Consumer Financial Protection Bureau (CFPB) filed a lawsuit against CashCall (PDF) and its related companies Western Sky Financial and Delbert Services Corp. alleging the companies engaged in unfair, deceptive, or abusive lending and collections practices. The CFPB is asking the court to order CashCall to refund money to consumers in states where the loans were illegal, and pay penalties.

Do you need to repay a CashCall or Western Sky loan? The answer is unclear. At least five states have filed lawsuits against CashCall in 2013 for offering residents in their states loans with illegal terms. If state courts find the loans are illegal, CashCall may need to return all of the interest and fees borrowers paid to the lender. But what do the pending state and federal lawsuit mean to you if you have a CashCall or Western Sky loan now?

Who can I call for California? I recently got a call from a law office about this silly loan that i took out back in 2013, they wouldnt work with me when i got laid off so i ended up stopping payment and forgot about it. Well i got a call recently that now it is up to 8K (from the original loan of 2500) i told them I would pay if they got rid of the interest but they wont. And they say they will garnish my wages at 600 bucks. Who can I call in the state of California about this. Any help would be great.

Wendell, North Carolina

I received a notice from Delbert Co. that represented CashCall/Western Sky and I received a letter from a law firm in D.C. to pay 10% of my original loan amount and my account would close and I could file my taxes to forgive what’s called a cancellation of debt. After I paid it the state I reside in ( North Carolina) A.G. with other states filed a lawsuit against CashCall back in December 2013. I recently viewed my credit report and it has not been removed. I have no idea when the lawsuit will be settled, however I did receive a letter from the office of the A.G. office from the state of NC back in March 2014, stating it’s getting close to being resolved or it may face a trial.

I have a Western Sky loan for $10,000 that I have been paying on since October of 2012. I filed a complaint with the CFPB and I received a response from Western Sky that had nothing to do with my complaint. I have since disputed their response and am now awaiting a reply. I have also contacted the Ohio AG’s office and I received a lame response that said that Western Sky is a Native American owned business and that I should contact the Bureau of Indian Affairs. The response from the AG’s staff also contained this line: “The Attorney General’s office is the legal representative for the state and all its departments, boards and commissions under R.C.109.02.” I took that to mean that they don’t represent me, the taxpaying citizen. I followed up by contacting an investigator in the AG’s office who I know professionally, and he has never returned my calls or emails. There are currently 28 complaints listed on the Ohio AG’s website against Western Sky. About 90% of those complaints are listed as being referred to another agency for resolution. Unfortunately that other agency appears to be the Bureau of Indian Affairs! The bottom line, unless everyone in Ohio starts contacting the AG’s office about this company, and keeps contacting them until they get an answer, this issue will never be dealt with in Ohio. Mike Dewine’s office apparently has very little interest in helping the citizens of Ohio like the AG’s in other states have done.


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