Several private lenders are encouraging young professionals with high incomes and good credit scores to refinance their student loans at more favorable rates, with an eye to establishing longer-term relationships with the borrowers. About $200 billion in student loans could be eligible for refinancing, Goldman Sachs estimates.
The Consumer Financial Protection Bureau is welcoming Wells Fargo's decision to move away from marketing services agreements based on recent interpretations of the Real Estate Settlement Procedures Act. "Wells Fargo's decision to exit all marketing services agreements is an important step for the mortgage industry towards ensuring compliance with the RESPA statute and freeing up more choices for consumers," said Samuel Gilford, a CFPB spokesman. Prospect Mortgage also is ending the practice.
The Senate on Thursday approved a measure that extends highway funding for three months. The House passed the bill earlier in the week. Lawmakers are expected to resume debate on a long-term funding plan when they return from summer recess. That plan includes a provision that would pay for roads with a cut in the dividend that banks receive from investments in the Federal Reserve system.
Cybercriminals are using business e-mail fraud to dupe small businesses into making bank transfers to fraudulent companies that appear legitimate. Some businesses that have been tricked are now employing extra measures to ensure money transfers get to intended destinations.
Financial institutions are gearing up for increased online and mobile fraud attempts as EMV-enabled cards begin to be used, an Aite Group study has found. Big banks are planning to invest more in online and mobile security over the next two years, Aite says.
The Financial Stability Oversight Council could take lessons from the NFL on transparency and procedure, writes Francis Creighton, FSR's executive vice president of government affairs. The agency is still too insular, and it needs to let companies know what they could do to lower their risk and therefore lose status as a systemically important financial institution, he writes.
The Federal Reserve Bank of Kansas City has turned down Fourth Corner Credit Union's application for a master account that would have enabled the credit union to handle business from state-licensed marijuana businesses in Colorado. Fourth Corner has filed a lawsuit in federal court against the Fed, seeking "equal access" to the federal banking system.
Millennials have focused on paying off student and auto loans rather than building a credit history using bankcards, according to a study by Experian. "While this generation may not look like they are on the right track financially, it's important to keep in mind that credit scores are built on credit experiences, and while this generation has been slower to use credit, they have plenty of opportunities to build a positive credit history," says Michele Raneri, vice president of analytics and business development at Experian.
Economic uncertainty underscores a need to raise the U.S. debt limit, Treasury Secretary Jack Lew says in a letter to Congress. The government can probably meet financial obligations until Oct. 30 by continuing "extraordinary measures" implemented in March, Lew says.
The Federal Reserve's policymaking committee has issued a cautiously optimistic report that says moderate economic growth is producing "solid job gains and declining unemployment." The tone suggests the central bank is close to raising its benchmark interest rate, possibly as early as mid-September. The Federal Open Market Committee has unanimously voted to keep interest rates close to zero a little longer.