CFPB’s Next Target Is Cross-Border Payments

America’s top consumer watchdog is reportedly looking to strengthen its rules for overseas money transfers.

The Consumer Financial Protection Bureau (CFPB) is considering new restrictions on the fees charged by money-transfer companies for wiring money overseas, bureau officials told the Wall Street Journal (WSJ) Monday (Jan. 16).

PYMNTS contacted the CFPB for comment Monday and received a reply from the bureau Wednesday (Jan. 18) that it had no other information to provide. The agency has of late been trying to crack down on unfair and unnecessary fees across the financial system.

In this case, bureau officials are looking into whether differences in the way money transfer companies disclose exchange rates and fees can make it tough for the immigrants and other workers who send money overseas to find the most affordable option.

Read more at PYMNTS.COM

US lenders are starting to go bankrupt with new mortgages down 47% — could this one factor trigger the worst surge of failures since 2008?

The real estate market just can’t catch a break, with inventory of resale homes remaining low and rising interest rates making it harder for buyers to justify making the leap.

And now we can add mortgage lender financial troubles — and the rise (and fall) of “non-qualified mortgages” — to the factors aggravating an already uncertain market.

A report from ATTOM reveals that new mortgage originations were down 47% in the third quarter of 2022 compared to the year before. That's a 19% decrease from the previous quarter and represents the biggest annual drop in 21 years. And while the chill in the market affects all lenders, non-bank lenders — especially those who deal in NQM — are bearing the brunt of it.

But what does the trouble around these NQM mortgages really mean? And what does it mean for non-traditional buyers trying to get a foothold in the market?

Read more at MSN

Why Many Americans Don’t Think They Need a Bank — Are They Right?

For something as seemingly mundane as banking, Americans are surprisingly split about the need for it, according to a new survey.

Indeed, the new Best Banks 2023 GOBankingRates survey found that only 56% of Americans say they “definitely need” a bank.

That leaves a whopping 44% of the population being somewhat ambivalent about the need for a bank: 20% of Americans say they “probably need” one and another 20% feel neutral about it. Meanwhile, 1.9% say they “probably don’t need” one and 1.6% say they “definitely” don’t.

Data shows, however, that despite this feeling, the majority of Americans have bank accounts. To put this in context, 4.5% of U.S. households — 5.9 million Americans — were considered “unbanked” in 2021, meaning that no one in the household had a checking or savings account at a bank or credit union, according to data from the Federal Deposit Insurance Corporation (FDIC).

Read more at GOBankingRates

For a Growing Number of Consumers, Mobile Wallets Fit the Bill

With nearly every adult consumer carrying some type of smartphone, digital wallets are an increasingly viable alternative payment method at the point of sale (POS) and online. Payments are not all they can do, either: They have also become a convenient way to store loyalty and rewards cards, transportation and event tickets, and even driver’s licenses in a handful of states across the United States.

Security features may help explain why 85% more consumers use mobile wallets to pay bills than to make in-store purchases. That could change soon, however, as government agencies, travel and leisure companies continue to adopt technology to access identification cards and tickets stored on digital wallets, making carrying a physical wallet less of a necessity.

Read more at PYMNTS.COM

Student Loan Forgiveness: Will You Qualify for $0 Payments Under Biden’s New Plan?

With the legality of President Biden’s broader federal student loan forgiveness program in question, the U.S. Department of Education (ED) has proposed revisions to income-driven repayment (IDR) plans that could result in considerable cuts to loan payments. In fact, some borrowers will have $0 monthly payments.

The ED-proposed regulations will amend the Revised Pay As You Earn Repayment (REPAYE) plan and phase out the three other existing IDR plans available to lower-income debtors — Pay As You Earn Repayment (PAYE), Income-Based Repayment (IBR) and Income-Contingent Repayment (ICR) plans.

Borrowers participating in existing IBR, ICR and PAYE plans will follow the new plan when enacted into law, but will need to enroll through their student loan provider or through the Federal Student Aid site. The new proposed regulations do not include changes to accommodate those holding Parent PLUS loans, which are not repayable on an IDR plan.

Read more at GOBankingRates

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Credit card debt reaches a record high among U.S. consumers

Credit card balances reached a record-setting $866 billion in the third quarter of last year, which represents a year-over-year increase of 19%.

Personal loans and credit card debt reached record levels in 2022 due to financial pressures brought on by high inflation and climbing interest rates, according to third-quarter data from a consumer credit reporting agency.

Credit balances reached a record-setting $866 billion in the third quarter of last year – and they are expected to keep climbing, the report from TransUnion said. Meanwhile, personal loan originations are expected to return to pre-pandemic levels in 2023, after experiencing record growth in the last 12 months.

Michele Raneri, vice president of research and consulting at TransUnion, said that despite mounting financial pressures, there’s optimism among consumers.

A Consumer Pulse study conducted by the credit bureau found that more than half of Americans expressed confidence about their financial health in 2023. Among the most optimistic were those in younger generations, with around two-thirds of Gen Z and Millennial consumers reporting that they felt positive about their financial future.

Read more at WUSF Public Media

61% of North American Workers Stress More Over Finances than Last Year

More than 4,200 workers across the United States and Canada were surveyed to analyze three clusters of people – Stressed, Unsettled, and Comfortable – and to understand ...

61% of employed North Americans are more stressed about their finances today than they were a year ago – and are experiencing the highest level of financial stress since the financial crisis of 2008. That’s according to a new survey by Ceridian, a global leader in human capital management (HCM) technology.

This study, created in partnership with the Financial Wellness Lab of Canada, surveyed more than 4,200 workers across the United States and Canada to analyze three clusters of people – Stressed, Unsettled, and Comfortable – and to understand how each demographic is adapting to economic developments, such as inflation and rising interest rates.

Read more at CPA PracticeAdvisor

As state-run retirement programs become more popular, participants are expected to have $1 billion in savings this year

While some of the state programs are voluntary, others require companies to either have their own 401(k) plan or facilitate automatically enrolling employees in a Roth IRA through the state’s option.

Of these so-called auto-IRA programs that are up and running, workers have saved more than $630 million.

Some employers are choosing to offer a 401(k) plan instead of participating in their state’s program.

Whether you have access to a retirement plan through work increasingly depends, at least partly, on where you live.

Within the last decade, 16 state legislatures have adopted retirement-savings programs targeting workers whose employers don’t offer a 401(k) plan or similar option. Some programs are up and running, while others are in the planning stages. 

Read more at CNBC