From ICBA...

CFPB Sues Online Lenders for Deceiving Consumers

The Consumer Financial Protection Bureau sued four online lenders for allegedly deceiving consumers by collecting debts they were not legally owed. The federal lawsuit says Golden Valley Lending, Silver Cloud Financial, Mountain Summit Financial and Majestic Lake Financial could not legally collect on these debts because the loans were void under state laws governing interest rate caps or the licensing of lenders.

Friday Rate Update

Mortgage Rates Fall Again
 
The rate for a 30-year fixed-rate mortgage averaged 3.97 percent this week, down from the previous week's 4.08 percent rate and the first drop below 4 percent since November, Freddie Mac said yesterday. At this time last year, the 30-year FRM rate averaged 3.59 percent. This week's 15-year FRM rate averaged 3.23 percent, down from last week's 3.34 percent. A year ago, the 15-year FRM rate averaged 2.85 percent.

--ABA Daily Newsbytes

Survey: New, Experienced Buyers See Value in Homeownership
 
A quarter of prospective first-time homebuyers said they expect to purchase a home in the next two years, according to Bank of America's second Homebuyer Insights Report released yesterday. To prepare for the purchase, 61 percent say they are paying off their current debt, 47 percent are working to improve their credit score and 45 percent are saving money to put toward their home purchase.

First-time and experienced homebuyers differed slightly in what they look for in a home, the survey found. More than half of first-time buyers said they preferred a home that they could make changes to, whether minor cosmetic changes or major renovations. Experienced buyers were more likely to seek move-in ready homes that would require no improvements.

When asked to define homeownership, nearly half of first-time buyers said they associated it with responsibility. Current homeowners, on the other hand, associated homeownership most strongly with financial investment; 70 percent reported spending their free time working on their homes, and 82 percent said they look for ways to make their homes more valuable.

The survey also noted that an increasing number of millennials are understanding the value of homeownership. Seventy-nine percent of millennial homeowners (those ages 18 to 34) agreed that buying a home would have a positive impact on their long-term financial life, and 86 percent said they view owning a home as a more affordable option than renting. The majority of millennial homeowners -- 68 percent -- said they view their current home as a stepping stone toward the home they want to end up in. Read the report. 

--ABA Daily Newsbytes

                                          Have a safe and pleasant Easter weekend. 

Consumers Weigh Closing Costs, Customer Service When Choosing a Mortgage Lender
 
When selecting a mortgage lender, a vast majority of consumers say that a lender's reputation for service is nearly as important a factor as interest rates and closing costs, according to a new study released yesterday by Ally Bank. Virtually all respondents said they consider interest rates and closing costs an important factor, while 93 percent said they would weigh a lender's reputation heavily when making a decision.

Eighty-one percent of Americans who have had a mortgage or plan to apply for one in the future said that total closing costs did or would factor significantly into their decision. Of those, four in five said that they would be influenced toward one lender over another by a $500 incentive to help offset costs.

Eighty-five percent of past or present homeowners said they were somewhat or very satisfied with the mortgage application process, while the remaining 15 percent were not satisfied. Key reasons for dissatisfaction were poor customer service (48 percent) and poor communication (46 percent). Nearly 40 percent expressed dissatisfaction over high closing costs.

--ABA Daily Newbytes

Fed Survey: Small Biz Performance, Loan Applications Tick Down
 
Small business performance and financing success rates dipped slightly in 2016, according to the latest Small Business Credit Survey -- a joint effort by the 12 regional Federal Reserve banks, conducted nationwide for the first time -- released yesterday. Slightly smaller shares of firms reported profitability, revenue growth and employment growth. Seven in 10 expect revenue to grow in 2017, while less than half expect to add more jobs.

Forty-five percent of firms applied for financing, a slight tick down from 2015. Three-quarters said they received at least some financing, and 40 percent said they received the full amount -- down from 50 percent the year before. Traditional bank lending remains the primary source of financing for the nation's small businesses, with small banks approving at least some of the amount requested for 67 percent of credit applicants, while large banks approved credit for 54 percent of applicants.

Credit approval rates fell in all lender categories, including nonbank alternative lenders and credit unions, which saw approval rates fall by 13 points. Small banks and credit unions shared a high satisfaction rating (75 percent on net) among customers. Larger banks saw net satisfaction of 46 percent. Community development financial institutions also rated highly, at 76 percent satisfaction. And while they improved their satisfaction rating 12 points from the previous year, nonbank alternative lenders earned a far lower satisfaction rating than their depository competitors at only 27 percent. Consumers cited lack of transparency and high interest rates as reasons for dissatisfaction.

Firms with revenue of more than $1 million were more likely to have credit approved from all sources except for CDFIs, which approved applications at a rate of 77 percent regardless of the size of the business.

--ABA Daily Newsbytes

Friday Rate Update

Mortgage Rates Fall 
 
The rate for a 30-year fixed-rate mortgage averaged 4.1 percent this week, down from the previous week's 4.14 percent rate, Freddie Mac said yesterday. At this time last year, the 30-year FRM rate averaged 3.59 percent.

This week's 15-year FRM rate averaged 3.36 percent, down from last week's 3.39 percent. A year ago, the 15-year FRM rate averaged 2.88 percent. This week's decrease marks the second straight week of downward movement.

--ABA Daily Newsbytes

ICBA Meets with Treasury Officials on Reg Relief!



ICBA community bankers met with Treasury Secretary Steven Mnuchin and staff at the Treasury Department to discuss how federal policymakers can address the impact of overregulation on community banks and the customers they serve. The meeting was held under President Donald Trump’s executive order directing the Treasury Department to review existing financial services laws and regulations.

---ICBA


  We are looking forward to seeing progress on regulatory relief.
Read more here.



 

New Post From ICBA

Community Banks Make Communities Better

Mar 31, 2017

Small business creation is about as American as apple pie and is essential to our nation’s economy. More than half of Americans either own or work for a small business, and small businesses create about two out of every three new jobs in the U.S. each year.

But did you know that community banks like Bank of the West in Grapevine, Texas, are the primary economic engines behind small businesses on Main Street—funding more than half of all small-business loans? 

“I was able to give my hairstylist, Kim, a loan to acquire a salon when the owner died. She was a young lady, she had good credit, but didn’t have a lot of collateral,” Cynthia Blankenship said during testimony before the House Small Business Committee. In total, nine stylists were employed because of that loan, noted Blankenship who serves as vice chairman, chief financial officer and corporate president at Bank of the West.

“It’s our job to put that customer in the right finance tool to get them their credit availability. Our reputation and integrity is riding on this as well.”

This April, in recognition of Community Banking month and the symbiotic relationship community banks have with their customers, we’re highlighting examples of community banks that are making their communities better places to live and work.

Giving Back

Community banks do much more than provide capital, however. They fill key roles as trusted financial advisors, mentors and philanthropists.

Mike Kochenour, chairman and CEO of York Traditions Bank in York, Pa., has built a thriving career and bank. Like many community bankers, Kochenour is eager to pass on what he’s learned to up-and-coming business owners.

“Word has gotten around that you can call him and he’ll answer! He wants to serve as a resource to help everyone reach their potential,” Suzanne Becker, marketing director at the bank shared with IB magazine.

Community banks are known for courting customers and now Allied First Bank in Oswego, Ill., has taken that role literally—building a basketball court into its headquarters for sports, fundraisers and community activities.

“Many, many times I’m out in the community talking about the bank or trying to attract new customers and inevitably what I hear is, ‘Oh, you’re the bank with the basketball court. I’ve got to come see that,’” said Allied First president and CEO Kenneth Bertrand.

When Citizens Bank of Edmond, Okla., is not helping local small businesses and consumers across its community, the bank is making a splash in its neighborhood with Herd on Hurd. With President and CEO Jill Castilla leading the charge, the bank’s Herd on Hurd street festival is bringing together families, friends and small businesses every third Saturday from March through October.

“With $4 million in local economic impact, our little bank community’s appreciation event is making a big impact in the Oklahoma City metro area,” Castilla told the Edmond Sun.

Read more here.

For more examples of community banks and bankers making a difference across the nation during ICBA Community Banking Month and beyond, follow #BankLocally hashtag on Twitter. To find your local community bank, visit ICBA’s Community Bank Locator at www.banklocally.org.