Small Dollar Loan Pilot Program

Small-Dollar Loan Pilot Program

In February 2008, the FDIC began a two-year pilot project to review affordable and responsible small-dollar loan programs in financial institutions.

The pilot is a case study intended to identify effective and replicable business practices to help banks incorporate affordable small-dollar loans into their other mainstream banking services. Best practices resulting from the pilot will be identified and become a resource for other institutions. Thirty-two (32) volunteer banks are participating. These banks have total assets ranging from $26 million to $10 billion and they are in diverse geographic locations.

Program Requirements
A key goal of the pilot is to observe and encourage participating institutions to experiment with providing safe, sound, affordable, and profitable small-dollar loans. Therefore, the FDIC has provided general guidelines for banks that seek to participate. It is anticipated that current or planned products offered by the participating banks are generally consistent with the FDIC's guidelines on small-dollar lending (see FDIC Press Release: PR-52-2007: FDIC Issues Final Guidelines on Affordable Small-Dollar Loans)

Key features described in the Guidelines on Affordable Small-Dollar Loans include:

* Loan amounts of up to $1,000;
* Amortization periods longer than a single pay cycle and up to 36 months for closed-end credit, or minimum payments that reduce principal (i.e., do not result in negative amortization) for open-end credit;
* Annual percentage rates (APR) below 36 percent;
* No prepayment penalties;
* Origination and/or maintenance fees limited to the amount necessary to cover actual costs; and
* An automatic savings component.

Do You Still Owe a Debt No Matter How Old? Find Out Here.

Are you being hounded by a debt collector for an old debt you thought was written off years ago? If so, it is likely you are being contacted by a scavenger debt collector, which is a company that purchases older, mostly uncollectible debt for a tiny fraction of its value. Scavenger debt collectors are notorious for using illegal and unethical methods to collect "time-barred" debt.

You do not have to pay debt that is considered too old by your state. Every state has laws governing the time in which a person or entity can file suit to collect a debt. Generally, a creditor or debt collector gives up his right to file suit to collect a debt after a period of six years from the time the debt was written off (or the date of last activity on your credit report), but various states allow anywhere from 2 to 15 years to collect delinquent debt (see statutes of limitation table below).

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Got a Complaint Against a Lawyer? Or Need Legal Assistance?

Many clients of lawyers have a positive experience, but many more seem to have one or more problems. It could be a problem with fees, with the results, with the burdens of discovery, with the delays, or with the irrationality of the system. Often they blame the lawyer for the problem, but don't know what to do about it. Maybe it's not the lawyer's fault at all -- they just don't know. They also feel that the entire legal system is designed to protect its own -- they don't know who to turn to or what to do. Clients, even large corporations, also feel that if they ask their lawyer questions or doubt their lawyer, the lawyer will retaliate against them.

No matter how sympathetic or irrational the situation may be, there are also times when the lawyer or legal system is not wrong or to be blamed. Sometimes you just need to move along.

While every issue is not alike, here are some common ways to address the problems with lawyers we see most often:

If you think you have been a victim of legal malpractice, the normal remedy is a new lawsuit for malpractice. It is generally not malpractice simply for a lawyer to lose -- the question is usually whether the lawyer was negligent in representing you and it caused you harm. Your first step is to try to locate a lawyer who handles such cases in your area.

Check with local bar referral sources to find a lawyer who handles this type of claim. Helpful links appear below.

It is normal for clients to be concerned that the system will protect its own. There are, however, lawyers who will sue lawyers -- just find the right one.

Lawyers who prey on their clients will rely on every trick of their trade to avoid liability -- clients seeking to pursue a legal malpractice claim must be prepared for a grueling experience.


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SBA Patriot Express Loan

The U.S. Small Business Administration has announced the SBA’s Patriot Express Pilot Loan Initiative for veterans and members of the military community wanting to establish or expand small businesses.

Eligible military community members include:


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Veterans
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Service-disabled veterans
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Active-duty service members eligible for the military’s Transition Assistance Program
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Reservists and National Guard members
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Current spouses of any of the above
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The widowed spouse of a service member or veteran who died during service or of a service-connected disability
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The SBA and its resource partners are focusing additional efforts on counseling and training to augment this loan initiative.

The American Legion

In the 1920s, The American Legion began a national program of Temporary Financial Assistance to keep the children of deceased or disabled veterans at home rather than in institutions. This cash aid is still available for cases not covered by subsequent state and federal programs for the needy. In 2007 of eligible veterans, the TFA program provided more than $562,100 to 521 families, benefiting almost 1198 children.

Through TFA, a local post can call upon the national organization for cash assistance to help maintain the basic needs of veterans' children. The TFA fund has been used to assist families in meeting the costs of shelter, food, utilities and health expense items when the parents are unable to do so, thereby keeping the child, or children, in a more stable home environment.
TFA Case Studies

Not being able to work due to an operation on his shoulder, a 20 percent disabled veteran and his two minor children were in financial difficulty. The mother of the children had abandoned the family, providing no support. While the family was receiving Food Stamps and assistance with their rent, they had fallen behind on the electric bill, and there was a good chance it would be cut-off. While a Service Officer was working to upgrade the veteran's disability claim, the Temporary Financial Assistance program stepped in and paid the electric bill, assuring the children would have a safe and warm home in which to live.

A Persian Gulf War veteran, with two minor children and a 17-year member of the Air Force National Guard, was discharged due to a disability he received while on active duty. When he was granted 50 percent disability VA benefits, he was informed he would have to repay thousands of dollars received as severance pay upon his discharge, reducing his monthly benefit to a paltry $182 a month. This amount, however, coupled with the minimum wages received by his wife, put the family $6 over the income limit to receive food stamps. In addition, the family had fallen behind in their rent. The Temporary Financial Assistance program provided rent money sufficient to ward off eviction as a service officer worked to increase the disability claim with the VA and assisted the veteran in filing for Social Security benefits.

Sometimes the Temporary Financial Assistance program simply provides dollars to help the parents with the general health and welfare of the children. Such was the case when a Coast Guard veteran was discharged with a very serious skin disease developed from exposure to chemicals used in his military trained maintenance position as an airplane mechanic. He was hired by civilian companies, because of his military training, but was again exposed to chemicals similar to those that caused the original problem. As a result, it was finally determined he would have to be retrained through the VA Vocational Rehabilitation program. The veteran's wife was a substitute teacher, and the income from this work was sporadic, at best, and the family was falling behind financially. Assistance was provided to give this family a hand up until the veteran was enrolled in the Vocational Rehabilitation program.