Bob, Vice President, Lending
Lending can be a very profitable business, especially for lenders who take advantage of consumers. Working with a non-profit credit union, like Pacific Service CU, can give you peace of mind in knowing we’re not gouging or overcharging to inflate profits.
Here are five bad loans you may want to say no to:
A “payday loan” or a “paycheck loan” allows you to get your paycheck before it’s been earned. Typically, a customer writes a check to the payday lender for an amount, including a fee. For example, you write a check for $250, but are only given $220 in cash. Fees on payday loans may be between 10-20% of the amount borrowed per occurrence. That may seem okay at the time, but over the period of a year, you could effectively pay 400%.
Rent to own
Rent to own offers are often marketed to customers with bad or no credit, preying on those who don’t have the cash to make a purchase. Consumers can rent to own products like appliances, furniture, electronics – even homes. Seems like a great deal, right? Unfortunately, only a very small amount of the monthly rental payment goes toward principal. The renter ends up paying significantly more over the life of the loan than they would have using another method of financing.
The selling point for rent to own homes is that at the end of the rental period, typically 2-3 years, a portion of the rental payment had been saved and is now your down payment. However, at the end of the agreement period, if the renter doesn’t qualify for a loan or simply doesn’t want to buy, the landlord keeps the money. It would be better to have saved your down payment amount separately from your rental payment because that money would be yours, not the landlords.
A balloon payment is an amount of money owed at the end of your loan term. You could pay monthly payments for years, followed by a one-time, lump sum “balloon” payment for the balance of the loan. This could be a good loan structure for some borrowers, however, be aware. You can get into trouble if you don’t have the funds, equity or good credit to pay off or refinance the balloon at that time.
Fees and Charges
Fees are often necessary to cover operating costs; however, you should be aware and always ask questions. Be wary about being charged cash up front, especially without a signed agreement. Origination fees or buying points may be charged at the time of mortgage closing to “buy down” your rate to a lower interest rate. Use our online calculator to see if this is in your best interest.
There are many variable-rate loans out there. We have many variable-rate options that can be great deals for consumers. But again, be aware. Know how often and by how much your rate or payment can adjust. Ideally your variable rate should be tied to a reputable index, such as the Prime Rate, and your payment should be limited in how much it can be raised.
Be savvy! Ask questions, shop around, read the fine print and be prepared to walk away.
by Michelle, Assistant Vice President, Operations
Several recent news stories have portrayed online services as a risky proposition for consumers. Contrary to what you may think, using eServices can actually keep your identity safe. Electronic delivery channels are usually free, easy to use and can be a crucial component in data protection and fraud prevention.
Here’s how you can use eServices to stay aware of risks and help prevent being exposed to fraud:
We know your time is valuable, that’s why we offer anytime access to your accounts with BranchLine. Using online banking, you can securely access your accounts and view your up-to-the-minute balances. That means you are always in a position to know about activity on your account.
Receiving your statements electronically is a great way to “go green” by eliminating the paper waste, but it’s also a great way to protect your account information. Since there’s no paper, you can avoid mail tampering and the exposure of your paper records in your home or garbage – you don’t even have to shred!
Plus, you’ll receive your statements sooner. Your email notification is sent as soon as statements are available.
Paying bills electronically protects your personal information in several ways. First, you don’t have to give other vendors your bank account numbers to debit your account.
Additionally, most bills are paid electronically, meaning a paper bill and check are never issued and sent through the mail – minimizing the risk of theft or loss. Bill pay also gives you more control. You decide when your account is debited and you can even set up bills for automatic payment.
Plus, you’ll love the convenience! I’ll never go back to hassling with stamps or envelopes. And the best part is, at Pacific Service CU, bill pay is free.
Account alerts tell you about activity on your account. You can elect to receive email notifications for most account activity, for example, when a check clears, when your check card is used, or when your direct deposit is credited. It’s easy to set up alerts. Using BranchLine online banking, click on “Manage Profile,” then “Manage Alerts.”
Simply stated, you’ll always know what’s happening on your account – when it’s happening.
Finally, ask your employer about direct deposit or payroll deduction. It’s a safe and secure way to make sure your paycheck is immediately available, giving you access to your money on payday. There’s no wait for a paper check and no risk of loss or theft. You can even set up multiple deposits to a savings account, your child’s account, or your loan.
I encourage you to try eServices to save time and money and be safe while you bank.
It’s easy to get started. Login to BranchLine or call one of our friendly member service representatives – we’re happy to help.
by Nannette, Vice President, Technology Solutions Group
Epsilon is a company that sends more than 40 billion emails each year on behalf of its 2,500 business clients, many of them household name retailers. Earlier this month, approximately 2% of Epsilon’s clients, estimated at more than 50 companies were affected by an email breach. SecurityWeek has confirmed that affected companies include US Bank, Brookstone, Best Buy, The College Board, CitiBank, Walgreens, Disney Destinations, McKinsey & Company, Home Shopping Network, JPMorgan Chase, TiVo, Kroger, Capital One, Ritz-Carlton Rewards and more.
Pacific Service CU was not affected, however, many of our members may have been exposed through other relationships. It is possible there are scammers out there with the names, email accounts and, potentially even, information about the companies with whom you shop or do business. The risk is these fraudsters may exploit your active company relationships and attempt to steal your identity and personal information. It’s a good time to remember to be cautious and aware about potential online scams.
Here’s how a potential scam might work:
Phishing and Vishing are types of deception to obtain sensitive personal information. An email is sent mimicking the appearance and identity of a company where you shop. The email may request that you update your account information, a credit card number or a password. Or, the scam might try to get you to visit fraudulent websites. A “spoofed” site could have malware or viruses that affect your computer, or they could encourage you to conduct transactions or update or verify your account information.
With the Epsilon breach, fraudulent emails could avoid spam filters because they are targeted to known customers, which could result in a greater likelihood that their attempts will be successful in convincing consumers to respond.
Here’s what you can do:
First, protect yourself by staying alert and acting cautiously to any requests for your personal information.
Don’t respond to unknown solicitations and don’t give your personal information to unknown people or companies. If you’re suspicious about an email you’ve received, you should visit the company’s website directly by inputing the URL or using a bookmark. Do not click on the response link in an email. Better yet, call them if you’re concerned. Be sure to use a phone number not contained in the email.
Avoid downloading files, emails or attachments from unknown sources because they could contain malware, viruses or links to counterfeit or “spoofed” websites.
Second, protect yourself and your computer while using the Internet, by keeping your computer’s firewall turned on and keep your operating system, anti-spyware and anti-virus software up to date.
And finally, report suspicious activity and suspected phishing attempts to the company being impersonated.
Social media sites are a great way to keep in touch with friends and family, share pictures and stories, or network for work. If you love your iPhone, Blackberry or laptop – here are a few tips to keep in mind while you use social media.
Sharing. When you post, tweet, share, comment, check in, geocode or use your location, you’re sending a shout out to all your “friends” letting them know where you are and where you’re not – home. Be aware of what you say and leave out details like your address, phone and any information someone could use to rob or impersonate you.
Friending. Yes, I know your friend’s cousin’s neighbor wants to be your friend. I think that was him, right? Often fraudsters impersonate real people and try to be your “friend.” The concern here is giving fraudsters private information about you and your location or them giving you viruses through clickable links or attachments.
It’s only my friends. Well, actually, it’s not. Social media sites vary in the amount of information they share with others. It’s important to customize your settings and configurations to make sure your information is safe, secure and most importantly, private.
Share your location? Many applications ask your permission to share your location. They pinpoint your location using GPS, so your precise location is known. Be aware that when you post pictures with Show Location enabled, your location may be published with them.
Social media is a great tool and a fun toy. Simply remember that the internet is a public place, so stay aware of your surroundings and never post anything you wouldn’t want the world to see.
by Nannette, Vice President, Technology Solutions
Jenna, Vice President, Operations
Skilled identity thieves use a variety of methods to gain access to your personal information. The best way to protect yourself is to be aware of common scams.
Recently, our members have reported and fallen victim to a new scam involving wiring money using services like Western Union or MoneyGram. Scammers target wire transfers because wiring money is like sending cash – you can’t get your money back once it is sent.
Follow these basic rules:
1. Never wire money to a person you haven’t met.
2. Never agree to deposit a check from someone you don’t know and agree to wire all or a portion of the money back.
Here are some common money wiring scams:
Lottery and Sweepstakes Scams
Transaction Overpayment Scams
Alleged Relationship Scams
Mystery Shopper Scams
Online Purchase Scams
Apartment Rental Scams
Advance Fee Loan Scams
Family Emergency or Friend-in-Need Scams
The Federal Trade Commission (FTC) website has complete details on these and other scams.
If you suspect that you have been a victim of fraud, or your account has been compromised, immediately call a member service representative at (888) 858-6878, ext. 6353. After hours, for debit or credit card fraud, please call (800) VISA-911. We can cancel compromised cards, change your account number or add a password to your account for future transactions if it becomes necessary.