The Survive and Thrive Boomer Guide

Department of Education’s latest idea for student loan relief is deeply flawed, consumer groups say

A Trump administration rule that denies loan relief to many students cheated by their schools is deeply flawed and should be overturned, Public Citizen and the Project on Predatory Student Lending told a court Tuesday. The groups represent student borrowers in a lawsuit challenging the U.S. Department of Education’s new “partial relief” rule.

The rule details how the department will decide whether and how much relief to give borrowers who have demonstrated that they were cheated by the schools they attended. Under the rule, most borrowers whose claims are approved receive only partial or no relief on their student-loan debt.

The lead plaintiff, Sammia Pratt, attended a Corinthian-owned Everest school in Florida for accounting, based on the false promise that she’d be able to transfer credits to the University of Central Florida.

Make sure to get price information about funeral cost, because some funeral homes failed to disclose it in undercover investigations

If you can’t leave home or travel to a funeral provider right now due to the covid-19 pandemic, you can get information about what it offers — and how much those goods and services cost. The Funeral Rule says funeral homes must give you information about their products and services, including their prices, over the phone if you ask for it. Some funeral providers also post price information online.

Bridget Small, consumer education specialist for the Federal Trade Commission, says when you make arrangements by phone, online, or in person, you have the right to:

• Buy only the goods, such as a casket, and services, such as a memorial service, that you want, instead of being required to buy a “package.”
• Use an alternative container — made of pressed wood, cardboard, or other material — instead of a casket for cremation
• Use a casket or urn you bought somewhere else.
• Get a written statement after you decide what you want, but before you pay. The statement must list the price for each good or service you chose, and the total cost. You have a right to get the written statement before you pay, even when you make arrangements by phone.

Nation’s largest subprime auto lender agrees to pay more than $550 million for deceptive auto loan practices

Santander Consumer USA Inc. agreed Tuesday to pay about $550 million or more to consumers nationwide to resolve charges that its subprime lending practices exposed them to high levels of risk with auto loans that had a high likelihood of default. Santander also agreed to make changes to its terms and conditions for extending credit.

“Santander defrauded desperate consumers by placing them into auto loans the company knew these customers could never afford to pay, resulting in defaults and negative ratings on consumers’ credit reports,” said New York Attorney General Letitia James.

In March 2015, a coalition of 34 attorneys general opened an investigation into Santander — the largest subprime auto financing company in the nation – after receiving an increase in consumer complaints on subprime auto loans. The coalition alleged that Santander – through use of credit scoring models that could forecast the risk of borrower default – knew that certain groups of consumers would have a high likelihood of default.

New website offers details for consumers on mortgage and rent relief during the coronavirus pandemic

A consolidated website providing information for consumers on mortgage and rent relief during the COVID-19 pandemic is now available, the Consumer Financial Protection Bureau announced Tuesday. The consolidated site will make it easier for consumers to get current information about their options as Congress and the Trump administration consider additional measures during the national emergency.

“Getting the right information to consumers with a website that links to all of the federal government’s relief efforts is a good step forward,” said Barry Zigas, a senior fellow at the Consumer Federation of America. “It should help reduce confusion among consumers and make it easier for them to get reliable information about their options.”

The website is hosted by the CFPB and sponsored by the bureau, HUD-FHA, the Federal Housing Finance Agency, which oversees Fannie Mae, Freddie Mac, and the Federal Home Loan Bank system. It provides links to specific areas of interest to consumers faced with challenges paying their mortgages or their rent.

Most of Americans unaware of dangers of using payment apps, survey shows

Seven in 10 people rely on peer-to-peer payment apps to transfer money in a quick and easy manner, according to an AARP survey. It also found that about half believe they’re able to reclaim money sent in error.

While the platforms are convenient, the difficulty of recovering funds sent through them makes the technology, and those who use it, uniquely vulnerable to scammers, said Kathy Stokes, AARP director of Fraud Prevention Programs. This may especially be the case as more people use delivery services for groceries and other necessities during the coronavirus pandemic.

“We know scammers are already capitalizing on anxieties and fears around coronavirus,” Stokes said. “With so many people at home, consumers should be alert for possible scams on peer-to-peer payment platforms.”

Education Department and Betsy DeVos are being sued by student borrower groups for seizing student borrowers’ paychecks during covid-19 pandemic

In a class action lawsuit filed against the U.S. Department of Education and Secretary Betsy DeVos, student borrower groups are asking the department to stop garnishing student borrowers’ wages.

Illegal garnishments

The CARES Act prohibits the department from garnishing wages of student borrowers through September 30, 2020. The lawsuit was filed last week on behalf of distressed borrowers whose paychecks continue to be seized in violation of federal law.

“With the President at her side, Secretary DeVos promised in March that she had stopped federal wage garnishments altogether, which is what the CARES Act requires,” said Alex Elson, senior counsel at Student Defense. “The truth is, she keeps on taking wages from the paychecks of Americans struggling to make ends meet. We sued to make her stop.”

Consumer groups criticize CFPB for faulty process in roll back of payday rules

Last February, the Consumer Financial Protection Bureau or CFPB proposed new rules that would roll back key provisions of the CFPB’s 2017 Payday Rule, which enacted modest protections for borrowers. The roll backs proposed were set to be finalized by the end of April 2020.

The New York Times reported on April 29 that the process to repeal the 2017 rule was riddled with research manipulation and inconsistencies. The Consumer Federation of America joined five other consumer groups on May 1 to call on the CFPB “to suspend the finalization of the rule pending a full investigation of the facts,” and state that “there is a strong case to be made that CFPB needs to restart the regulatory process entirely.”

In addition, on May 1, more than a dozen lawmakers joined in asking for “an examination of political pressure at the consumer bureau,” as The Times reported.

Funeral guidelines in New York show the need for consumers to be aware of their rights during coronavirus pandemic times

If you lose a loved one and need to arrange for funeral services in the coronavirus pandemic era, be sure to find out your rights as well as to compare prices. For example, rules may be changing for cremation and burial.

In New York, Attorney General Letitia James issued guidelines Saturday to protect New Yorkers using funeral homes and reminded funeral homes that the office will take action against any business that violates consumer rights.

Those arranging funerals should be aware of requirements and recent executive orders and emergency regulations that impact funerals and funeral arrangements in the following ways:

Progressive Leasing to pay $175 million to FTC to settle charges it deceived consumers about prices

Progressive Leasing will pay $175 million to settle Federal Trade Commission charges it misled consumers about the price of items purchased through its plans. The company markets rent-to-own payment plans at more than 24,000 retail locations – including stores such as Best Buy, Lowe’s, Big Lot’s, and Kay Jewelers – in 46 states and the District of Columbia.

Consumers who visited retailers to buy items such as furniture, jewelry, or cellphones were often told that Progressive’s payment plans were “same as cash” or “no interest” – leading consumers to believe they wouldn’t be charged more than an item’s sticker price, according to the FTC’s lawsuit filed Monday.

Instead, the lawsuit alleges, consumers paid more than the sticker price, and often paid about twice the sticker price if they made all scheduled payments under the plans. When consumers were presented with the terms of Progressive’s offers, they were shown the “cash price” of the item, as well as the cost of their initial payment and each periodic payment.

State Farm gets an ‘A’ and GEICO a ‘D-‘ on report card of refunds or credits for driving less due to the coronavirus pandemic

Companies that sell more than 82 percent of the auto insurance in the United States have announced that they’ll be refunding or crediting drivers more than $6.5 billion over the next two months. The payments are due to the insurers’ savings from fewer auto insurance claims related to the huge reduction in cars on the road and miles driven during stay-at-home orders and other covid-19 precautions.

The Consumer Federation of America and Center for Economic Justice contacted insurers and state insurance regulators to urge this type of relief in letters to commissioners sent on March 18 and March 30.

The groups also assessed different approaches insurer could use for relief and a way to ensure fairness.