County Bank Pay Day Loans

CDC offers housing, business assistance

The CDC is also a certified reverse mortgage counseling agency. A reverse mortgage allows a homeowner to borrow money against the value of his home. No repayment of the mortgage's principal or interest is required until the borrower dies or the home is sold. It is a loan available to homeowners aged 62 or older under a federal program administered by HUD. Before they start the loan process, people interested in applying for a reverse mortgage are required to take an FHA approved counseling class and present a certificate of completion. Daryl Davies is a CDC housing counselor who specializes in reverse mortgages and other home purchase services. He is also a certified reverse mortgage counselor and teacher. Karen Krafft, another CDC housing counselor, specializes in loss mitigation, loan modification and credit counseling services. She also assists homeowners who are facing foreclosure proceedings. Both staff are HUD certified counselors. "Karen works with people who need to try to get their loans modified," Poe added. "She'll go to court with them when they may be getting ready to go through foreclosure. The court has worked very well with us. It is very common that they see Karen in court, ask her what case she's there for and then give them a 90-day extension to try to work things out. "Karen also administers the Mortgage Protection Program, which makes funds available - again through the Housing Finance Agency - for people who have short-term employment related issues. That can help them keep up with their mortgage and pay it, for instance, as they re-train for a new job. This can include people who've been laid off or maybe had their hours cut back." "This has two sets of funds," Poe said. "One is $15,000, with a $2,500 administrative overhead that comes off the top for fees, inspections, etc. It will help someone with any energy efficiency issues they have with their home.

An alternative to payday loans | Marketplace from American Public ...

Tess Vigeland: For folks in this country who live paycheck to paycheck, sometimes the only way to make ends meet is by heading to a payday lender. These storefront operations have quickly grown into a $40 billion industry.

But more often than not, payday loans come with triple digit interest rates that trap borrowers in a spiral of debt. So the federal agency that insures bank deposits, the FDIC, is asking banks to provide some competition. From WCPN in Cleveland, Mhari Saito reports.

Mhari Saito: When Jacqueline Oliver first tried payday loans, she loved how easy and convenient they were. She walked into a Cleveland payday lender with a pay stub from her county health care job and wrote a check for the amount she wanted to borrow -- $300, plus the lender's $45 fee. The check was dated for two weeks later, when her next paycheck would come in. But the lender would give her the cash up front. Soon, this 44-year-old single mom found herself in over her head.

These days Oliver uses her credit union to borrow cash. On this Friday, members were lining up for "Grace Loans." Customers at Cleveland's Faith Community United Credit Union can borrow up to $800 if they have direct deposit and put $10 in their savings account. Borrowers pay 17 percent APR, or annual percentage rate. That's much lower than the 391 percent that local payday lenders charge, and they can pay it back in several payments. CEO Rita Haynes says she wanted to provide her members a better short-term loan.

Faith Community United is one of a small but growing number of credit unions trying to give payday lenders some competition. Now the FDIC wants more banks to jump in to the race. The FDIC's Bob Mooney says that's why the federal agency released guidelines earlier this summer for the type of payday loan they'd like banks to offer: Small, one-month loans capped at a 36 percent annual percentage rate.

To entice banks, the FDIC is offering extra credit at exam time. Every year banks have to show they are trying to meet the federal Community Reinvestment Act by doing business in the rich and poor parts of their neighborhoods. Banks that offer small dollar loans that follow the guidelines will get "very favorable" consideration in their annual reviews.

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