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Credit Counsel Inc
Debt Recovery
Debt Recovery


It seems that the Consumer Finance Protection Bureau might be coming down hard on consumers regarding paying back most debt at once, including payday loans, auto title loans, deposit advance products, and longer-term loans with balloon payments. Under the new rule, lenders will be required to conduct a comprehensive “full-payment test” to determine upfront that borrowers can afford to repay their loans without re-borrowing.

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Monthly debt collection complaints continued to decline in June, while consumer litigation filings fluctuated, according to the latest Debt Collection Litigation and CFPB Complaint Statistics report from WebRecon.

“There is very little comprehensible pattern to be discerned, beyond the fact that the overarching pattern seems to be pretty steady in spite of monthly ups and downs,” WebRecon CEO Jack Gordon said in the report.

Debt collection complaints declined 26.1 percent from 4,102 in May to 3,033 in June, according to the report.

Year-to-date, there were 19,488 complaints as of the end of June 2016 compared to 23,722 in June 2017, a 21.7 percent increase, according to the report.

Similar to April and May, debt collection companies responded to a majority, 95 percent (2,884), of June 2017 complaints in a timely manner.

Of the complaints filed, 1,305 (43 percent) were about continued attempts to collect a debt not owed, 708 (23 percent) were about written notification of a debt, and 348 (11 percent) were about communication tactics, according to the report.

The top five sub-issues in debt collection complaints were:

Debt is not yours (22 percent)
Didn’t receive enough information to verify debt (17 percent)
Debt was paid (12 percent)
Attempted to collect wrong amount (7 percent)
Debt was result of identity theft (6 percent)

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Health Survey Shows Decline in Consumers Having Trouble With Medical Bills
Data from the first six months of this year show a decrease in the percentage of consumers having problems paying medical bills, according to the Centers for Disease Control and Prevention National Center for Health Statistics.

Overall, the percentage of consumers under age 65 in families having problems paying medical bills declined from 21.3 percent (56.5 million) in 2011 to 16.2 percent (43.8 million) in the first half of this year, according to the survey.

Changes in the insured rate also occurred during this time period. In the first six months of 2016, 28.1 million persons under age 65 were uninsured at the time of interview—17.8 million fewer persons than in 2011 (17.3 percent) but only 0.3 million fewer persons than in 2015.

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Credit Cards, Auto and Student Loans Cause ‘Modest’ Increase in Household Debt. Total household debt reported by the Federal Reserve Bank of New York increased slightly in the third quarter this year, influenced by an uptick in credit card, student loan and auto loan balances while mortgage balances declined.

The Quarterly Report on Household Debt and Credit is based on data from the Fed’s Consumer Credit Panel, which includes a group of individual and household debt and credit reports from anonymized Equifax data.

Overall, total household debt increased “modestly” by 0.5 percent, or $63 billion, to $12.35 trillion in the third quarter, according to a news release from the Fed.

Credit card balances increased 2.5 percent, or by $18 billion, to $747 billion and student loans increased 1.6 percent, by $20 billion, to $1.28 trillion. Auto loan balances increased the most among non-housing debt by 2.9 percent, or $32 billion, to $1.14 trillion, according to the report.

Debt Collection Complaints Continue to Decline
October marks the second month showing a decrease in debt collection complaints to the Consumer Financial Protection Bureau.
Consumer Financial Protection Bureau received 3,103 debt collection complaints in October, down 11.3 percent from a revised 3,498 complaints in September, according to the report. The numbers can fluctuate as more complaints come in to the CFPB.
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