Saturday, September 6, 2014

Debt Neutrality Petition reaches 657 signatures on Change Dot Org.

Feel Free to use any of the Debt Neutrality Petition images below for your facebook page or twitter account or blog.

Please consider viewing and then signing the Debt Neutrality Petition by clicking here.

Saturday, May 3, 2014

Quicken Loans doesn't do safe, first lien HELOC's or REHELOC's but hey, they gotta a great deal on a Reverse Mortgage, lol.

Respect I may have thought I had for Quicken Loans went out the door when I discovered they presently do not offer first lien HELOC's or first lien REHELOC's, but would be more than happy to put me into a reverse mortgage that over time might result in 70 to 80% of the entire home's equity going to the mortgage insurance premiums and interest rate charges on the equity taken out of the home, also known as a long term rip off program, no?

So HUD, by pushing HECM's, has effectively throttled responsible homeowners who have no mortgage but would like to pull equity out of their home via a first lien HELOC, or, pay off their present first lien HELOC with a new HELOC, aka a first lien REHELOC.

I'm just shocked at how horribly our government is treating retiree's who responsibly paid of their homes and are asset rich but cash poor and can easily collateralize any equity taken out of their homes because they don't have a mortgage.

Please consider viewing and then signing the Debt Neutrality Petition by clicking here.

Thursday, April 3, 2014

Credit Card Market Faces Regulator Probe | Key 103 Manchester

If you visit the Consumer Financial Protection Bureau's debt collection  practices commentary site, Regulation Room dot org (you will need to click on the small white arrow located within the rectangular blue box to see the comments), I left several dozen comments about Credit Card Practices that need to change. 

In England they are actually going to do a review of credit card practices, something the CFPB in the U.S. has been reluctant to do so.

 Please consider viewing and then signing the Debt Neutrality Petition by clicking here.

Saturday, March 29, 2014

Motley Fool Credit Card Article "Is Your Credit Card Interest Rate Above 20%? This Chart Shows Why." is a load of propaganda.

Motley Fool article is way off the mark in this blog's opinion. Credit Card Debt is the BIGGEST profit center for banks. 

What Motley Fool fails to acknowledge is that as time goes on not only are consumers paying a ridiculously high interest rate on credit card debt, but a significant portion of the credit card debt is interest rate charges that are accruing more interest rate charges!

One way to show how foolish Motley Fool is regarding this credit card debt article would be to create a graph that reveals what percentage of all credit card debt is actual interest rate charges that are "nestled", or nested, into the credit card.

If a credit card customer with a 5,000 dollar credit line defaults after 15 years, but in that 15 years time paid 15,000 dollars in interest rate charges and of the 5,000 dollars still owed 3,500 is additional interest rate charges that just keep accruing, just how badly did the credit card company lose? But wait, lets factor in that credit card companies are UNINTERESTED in collecting the defaulted debt if it were to be paid back slowly with no more interest rate charges, penalties or fees added in.

I didn't realize that Motley Fool (in my opinion) was such a government propagandist by actually justifying a 20% or higher interest rate charges on a credit card, wow.

Please consider viewing and then signing the Debt Neutrality Petition by clicking here.

Wednesday, March 26, 2014

Mathematical Example that Shows when a Reverse Mortgage is a bad idea.

Example 1, when Reverse Mortgages are a bad idea.

Retired couple wants to supplement their social security income by withdrawing 500 dollars a month against the value of their paid off $500,000 home via a reverse mortgage. They consider this to be a 20 year plan.
Unfortunately, the entire value of the home will be absorbed after 17 and 2/3's years in the following manner. The couple will get $106,500 in 500 dollar monthly payments while accruing interest rate charges on the money taken out by the couple plus the mortgage insurance premiums will be approximately 393,500!
I used a mortgage insurance premium interest rate of 1.5% on the full value of the home (it can be as high as 3% and perhaps down to 1.25%) plus 7.5% interest rate charge on the entire equity that has been taken out of the house (meaning mortgage insurance premiums on the full value of the house plus the modest monthly draw being taken out by our frugal, retired couple) for my calculation.

Now it is possible that the home may go up in value during that 17 years time. However, will increase in home value be absorbed by a higher and higher mortgage insurance premium amount as the value of the home rises? If the answer is yes, than a long term reverse mortgage may be a horrible long term program.

So when is a Reverse Mortgage "acceptable"? I don't know all the examples but three that come to mind would be, home is about to be lost to foreclosure and the Reverse Mortgage prevents that from happening. 

A second example would be Reverse Mortgage is used for needed home improvements so the home is more easily sellable in the near future.

A third example would be for whatever reason, getting a large chunk of money out right away while still being able to live in the home for a "while" is desired.

In my opinion, think of Reverse Mortgage as a short term plan, probably for most people 5 years or less would be my guess, but keep in mind that even if the home is sold within five years, there will still be signifcant amount of equity that went to the mortgage insurance and interest rate charges charged on whatever equity was converted to cash.

A HELOC is probably a more superior financial product but the government in their questionable wisdom has basically shut out 99% of all retirees from being eligible for a HELOC based on their social security income. It appears that Dodd / Frank bill is to blame for this.

Please consider viewing and then signing the Debt Neutrality Petition by clicking here.

Friday, February 28, 2014

Consumer Financial Protection Bureau Pay Day Loan "Solution" about to Endanger Millions of Seniors and those with No Savings.

The following is an email that was sent to the 600 plus signers of the Debt Neutrality Petition. When you sign the Debt Neutrality Petition, you also get 1 or 2 free email updates every month regarding important consumer debt issues that seem to not reach the main media radar.

Debt Neutrality Petition has uncovered banking news that may adversely affect millions of seniors and those on a strict budget after Mid May of 2014. Apparently ALL BANKS are DISCONTINUING their direct deposit advance program by mid May of 2014!

For those of you who have never used direct deposit advance, you have been blessed! However, if you have found yourself financially short before the end of the month and just need a one time advance to prevent a chain reaction of penalties and fees for being late on various bills, then direct deposit advance could be a sparingly used, but much needed lifeline.

One big problem with direct deposit advance has been the 1.50 fee per 20 dollars borrowed for what might just be one week, or less! That works out to 693% interest! Rather than drop that ridiculous $1.50 per 20 dollars charge to a still very high but much more reasonable 1 dollar for ever 25 dollars borrowed, the CFPB has apparently scared off the banking industry from offering the direct deposit advance program all together.

I previously wrote that the CFPB is more about enforcing the alignment of balding tires on a car versus making the situation more palpable for people to get new tires. In the issue of direct deposit advance, the CFPB has actually blown out the balding tires and made the situation far far worse, especially for seniors!

99% of all Home Owning Seniors living on social security income DO NOT qualify for ANY TYPE OF LOAN other than a Reverse Mortgage (you heard it here first). Most of the time a Reverse Mortgage is a mega rip off in which the mortgage insurance monthly premiums may be HIGHER than the monthly amount the senior wants to take out of their own paid off home!

So if a senior citizen WHO OWNS THEIR HOME has a sudden, one time need for a relatively small amount of cash; they could have a perfect payment history, a 725 credit score, have social security income, and still be denied ANY AMOUNT OF MONEY from any type of loan presently being offered by our wonderful banks. This is beyond criminal.

I am probably the first person and maybe the only person warning you about the dramatic shift into an extinction of loan opportunities for retired homeowners, and how the CFPB has managed to jeopardize the very people they are supposed to be helping by killing off direct deposit advance.

I have literally bent over backwards to greet the CFPB when they came to Los Angeles for a meeting in May of 2013. I reached out to them with well researched documents, and I also commented at that meeting and have posted comments on their facebook page, but the CFPB doesn't appear to feel my research needs to be addressed or taken seriously.

Even if you have never used direct deposit advance, please read this short story on how easily you could suddenly need direct deposit advance, if only for one month.

Someone's bank account was compromised by fraudulent third party billing by a person they had never meet. The bill of around 60 dollars was simply deducted from the victim's account. The victim fortunately discovered the fraud almost as soon as it happened and immediately reported it to their major bank (Wells Fargo).

It took Wells Fargo 10 business days to actually review the claim! (actually 15 when weekends and a Monday Holiday were added in.) For those 15 days this person's account remained in the negative because of the fraud.

The victim had two very small credit card bills to pay but suddenly the money allocated for those two bills had been electronically stolen by someone they never met. (The person's name and the name of the company accepting the payment did appear on their online banking statement).

Now imagine if direct deposit advance were not available. Those two bills would have gone unpaid, risking the victim to a rate hike in interest from their special rate of 4.9% to as high as 29%!

A couple of months from now, just one fraudulent third party access to an account with no direct deposit advance option could cause one to lose whatever solid interest rates they have managed to get from their credit card companies.

Someone is able to get a bill fraudulently paid via an unsuspecting bank customer's account and by the time the victim discovers the fraud, reports it and the slow moving banks fix the situation, the victim misses two payments because there is no direct deposit advance anymore.

The banks needed 2 business weeks, plus four weekend days, basically that's 15 days to resolve any fraudulent activity on the victim's account. If the fraudulent activity puts the victim in the red, and if their credit card overdraft kicked in putting them over their limit, they could literally have their finances come to a screeching halt for weeks.

Even though the victim immediately reported the fraud on their account, the banks WILL NOT suspend the fraudulent activity until AFTER their investigation is complete.

If you instead use cash advance from another credit card to pay those bills, you will then need to make more than the minimum payment to make sure that the ultra high cash advance interest rate charge doesn't nestle into the credit card accruing high interest rate charges month after month. Ironically, making a credit card cash advance can be potentially just as bad as the usurious rates being charged on direct deposit advances.

In my opinion services like LifeLock charge too much per month, something like 25 dollars per month or 275 dollars per year. In my opinion, it should be five bucks a month for a service like Life Lock, not 25 dollars. Then it becomes a no brainer to do it.

The CFPB screwed up big time by scaring the banks away from direct deposit advance.

Please try and make some type of financial arrangements in the event you are a victim of withdrawal fraud on your bank account so you don't become financially frozen while the bank takes up to 15 days to fix the fraud.

Sincerely, Alessandro Machi

Below are some blog links if you want to read about financial terrorism articles I have written in the past. , , . , ,

Friday, January 31, 2014

Consumer Financial Protection Bureau Reg Room January 2014 Call To Action for Veterans and Seniors.

Important notice for veterans and seniors regarding debt collection practices.

We here at want to say "thank you" for joining the discussion on Consumer Debt Collection Practices. The time period for commenting ends soon - don't miss your chance to have your voice heard. Your input helps CFPB decide what to do next. The more they hear from consumers like you, the more fair and effective the regulations will be.

If you know someone who has a story to share about debt collection, please spread the word by sharing the link to

We haven’t heard much from older consumers  and current or former members of the military on, and CFPB wants to know what issues these groups face that it needs to address.

Thank you again for helping us in our mission to give everyone a real voice in government decision making.  We hope to see you again soon on


The Regulation Room Research Team

Please consider viewing and then signing the Debt Neutrality Petition by clicking here.