Citizens Reform Center

It should be no surprise. With a severe recession coming on the heels of years of outsourcing followed by predatory lending of sub-prime mortgages, millions of people are unable to keep up with monthly expenses. The biggest expense is housing. Marketwatch.com has reported that James Saccacio, CEO of RealtyTrac, states that “in the long term, a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond, as lenders gradually work their way through the backlog”.

Foreclosures in California, Florida, Arizona and Illinois account for more than half the national total. According to new data released by Lender Processing Services (LPS), one in every 7.5 homeowners with a mortgage in the United States is either behind on their payments or in foreclosure. This equates to a record high 13.2 percent of the nation’s home loans.

Along the same lines, bankruptcies are also at record levels. One of America’s favorite vacation places is experiencing serious hardship, which can be viewed as an economic indicator. The Las Vegas Review-Journal is reporting that bankruptcy filings in Nevada were up 58.6 percent in 2009. Bankruptcies in the state rose to 29,170 filings from 18,389 in 2008.

It’s hard to know what’s worse, the current rate of foreclosures or the impossible prospects for job creation that would generate the necessary level of employment and decent income to enable people to end this downward spiral. The redirecting of Wall St. bonuses to a serious job stimulus would likely find mass appeal at this point.

Read more here.

We all know that joblessness has hit double digits. We know the official rate is far below the actual jobless rate when you take into account people who have stopped filing for unemployment benefits. Just as significant, if people are able to find work, the jobs will almost definitely pay less than what was available in the past. However, the cost of living continues to go in the opposite direction — higher. No wonder people with jobs are working more hours than ever and barely staying afloat. A high percentage of college students were enticed by credit card’s lure of easy money can’t find work and are unable to keep up with payments. This all translates into record levels in credit card and mortgage defaults.

Just do a Google search on “credit card default rate 2009″ and 4,710,000 pages turn up. You’ll learn points like the following:

• Advanta’s default rate more than doubled in June from May to 56.95 percent, and they’ve shut down lamost 1 million accounts after posting three quarterly losses. In Nov. Advanta filed for bankruptcy. This came just after another lender to small business, CIT, filed for bankruptcy.
• We know credit card companies have jacked up their interest rates sky-high to 32% and more. Since the new Credit Cardholders Bill of Rights Act takes effect in Feb. 2010, banks have done all they can to pre-emptively gouge the consumer.
• In August it was reported that Canadian credit card default rates hit record levels. Obviously, this economic strain has hit almost all “first-world” countries.
• In August it was reported that banks were cutting credit limits for 58 million card holders.
  According to the LA Times, in August mortgage default rates soared to 13%.
• The third-largest issuer of Visa credit cards, Capital One Financial Corp. (COF) stated a rise in its net annual charge-off rate to 9.60% in Nov 2009 from 9.04% in Oct 2009. See more figures in this Reuters article.

Throughout the spring and summer articles report that default rates by major lenders increased. This is all the more reason to learn what CRC has to teach about the true nature of banking and debt, as well as what you can do if faced with debt collection actions or foreclosure. Learn how members are being successful in stopping these collections and foreclosures. Also, being part of an excellent support network is key. Having the right knowledge and connecting with the right people will make all the difference.

If you’re in search of knowledge and support, find out how you can become part of CRC’s Legal Club.

Citizens Reform Center held events in Manhattan and Long Island on Dec. 12th & 13th titled “The Truth & Consequences of Banking Credit Fraud”.

People challenged with credit card lawsuits and home foreclosure as well as people desiring to know the inner workings of the money/credit creation process received an information-packed seminar from nationally known banking expert Mickey Paoletta.

Believe it or not, people came from as far as Boston, Rhode Island, and Pennsylvania. At least 5 people who attended the Saturday event couldn’t get enough and made the 1 1/2 hour trip to the Sunday event in Long Island. Although, there are some excellent resources on the history and functioning of the Federal Reserve, attendees got an education which is not being taught anywhere else — the true nature of credit and debt at the consumer level.

For anyone in the NYC area looking for a support network on these topics, email the NYC Area Coordinator. Please include your contact information. We will be having conference calls and meetings beginning in January.

The Truth & Consequences of Banking Credit Fraud

If you or anyone you know is mired in credit card debt, is facing foreclosure, or supports an end to the Federal Reserve’s political domination of financial policy, come hear banking expert, Mickey Paoletta, reveal what the banks and government do not want us to know. The time has come for the reality of banking practices which effects us all to be revealed — the true nature of bank-created credit.

You will learn the legal steps you can take to eliminate your credit cards and stop the banks from taking your home. You will also learn about the Fair Debt Collection Practices Act which entitles you to take legal action against lenders for abuses against you and actually receive large sums of money from debt collectors. Additionally, we will discuss the criminal use of the courts who act as a front for the credit card companies and mortgage lenders who have been committing highway robbery on the average individual, leaving millions of Americans in a state of peonage.

Read the rest of this entry »

In Michigan, hard hit by long-term economic decline, has one of the highest rates of unemployment and foreclosure in the nation. It’s important to understand the sequence of events and potential remedies to stay in your home. If you have a way of coming up with some of the funds, negotiate with the lender. It’s in their interest to work with you.

CRC has helped many people challenge the system and stay in their homes. We’re currently making progress in non-judicial states.

In any event, there are possibilities that will enable a homeowner to delay the loss of their home, if not stop the foreclosure altogether. For more, see this article about foreclosure in Michigan.

The credit card companies simply have no shame. Regardless of the political pressure and public backlash they’re likely to experience from raising interest rates before the new law takes effect, they’re raising them anyway.

What can you do? Call and complain. Threaten to take your business elsewhere. Get a card through a credit union. According to a news report on Channel 10 in central Ohio…

“Consumer Reports says you can often find better credit cards from professional organizations, such as teachers’ associations, from credit unions, and from community and regional banks.

“There are now often one-time fees on balance transfers, so before you switch to a new card make sure you check that,” Kleman said.

Also check if the new card carries an annual fee. The kind of charge is making an unwelcome comeback. Credit unions can be a good place to get a credit card. These days it’s easier to join a credit union than it used to be.”

Read about the entire report here.

What good are banking regulations designed to stop predatory lending practices if they aren’t used? This is just how the subprime lending catastrophe happened according to a recent Washington Post article detailing how the FED may have been watching banks, but not their subprime affiliates. Furthermore, evidence has surfaced that minority neighborhoods were targeted for these risky mortgages with fine print that often went unnoticed which referred to adjustable interest rates. Community groups requested oversight and action from the FED to no avail. Millions of people have lost their homes due to these deceptive lending practices.

See full article here.

Reserves of the Federal Deposit Insurance Corp. (FDIC) which insures bank deposits has hit a 17-year low of $10 billion. This is a result of the wave of bank failures over the last 2 years. Due to financial hardship, many banks are unable to pay new insurance fees to shore up the FDIC. Could this mean that taxes will be the only recourse?

See article here.

Now that the National Arbitration Forum has withdrawn from arbitrating disputes between banks and the public due to a legal action from the Minnesota Attorney General, Bank of America has announced that it will no longer require arbitration as a means to resolve disputes with consumers. The bank acknowledged that they will now have more disputes result in litigation, which could become costly. Consumers who were victimized by the arbitration process have won this battle by making it clear that rulings disproportionately favored the banks.

For more, see the Associated Press article.

Have you read the fine print on a credit card agreements? Have you seen the part saying that disputes could be decided by arbitration? Most would think that this would be an equitable way of resolving differences through an impartial process that would save both sides money, time and effort. Nothing could be further from the truth. To underscore how serious the problems have been, the Obama Administration is proposing an end to arbitration clauses altogether. In actuality, the The National Arbitration Forum (NAF), which has been the arbitrator of choice by the powerful credit card industry has been working in collusion to overwhelmingly overpower the consumer.

Due to the high level of consumer complaints and lawsuits, the Minnesota Attorney General, was forced to take action and sue NAF for “violating state consumer fraud, deceptive trade practices and false advertising laws by hiding financial ties to collection agencies and credit card companies”. With this heat from the AG combined with mounting legal costs, NAF has decided to withdraw from the arbitration business in which it had decided against the public 94% of the time, which has been revealed in a study by Public Citizen. According to a recent AP article by Personal Finance writer Candice Choi, would only list arbitrators who decided in their favor, paying them $400 or more per hour.

This further reveals that the multi-billion dollar debt collection industry has violated laws, not to mention moral standards, that has resulted in the financial ruin of countless Americans who have been victimized due to their lack of knowledge of money, credit, and law.

CRC urges anyone being harassed by debt collectors to learn the principles of money creation, learn their civil rules of procedure, and become part of the movement to create true financial reform.

If you were forced into arbitration with NAF and received a judgment against you, contact us at CRC to vacate the judgment and take part in a class action suit.

For more detail, see this article at Counterpunch.com.

If you were forced into arbitration with NAF and received a judgment against you, contact us at CRC to vacate the judgment and take part in a class action suit.

If you have received a judgment against you from a NAF arbitration, contact us at CRC to pursue vacating the judgment. Call us at 212-631-5886 and leave your information..