Utah grants Debt Settlement license to Preferred Financial Services Corporation

November 8th, 2011

Andover, MA, October 25, 2011: 

Preferred Financial Services Corporation continues to follow through on its strategic mission of becoming the leading debt settlement company in the industry, “gaining nationwide licensing is a key strategic initiative for us, we believe in regulation and legitimacy, sensible state regulation plays a big part in that” stated Gabriel Tavarez when asked about the importance of the Utah license to the company.  The company had to undergo rigorous examination in order to meet the licensing requirements, an abbreviated list of requirements:

  • Accreditation of Counselors
  • Bonding
  • Certificate of Good Standing
  • Criminal Background Checks
  • Financials (business)
  • Insurance
  • Training
  • Education Material

Licensing requirements are designed to screen and evaluate everything about the company.  The State of Utah wants to see that there are trained counselors dealing with their consumers.  Ample bonding and strict insurance requirements are also expected of licensees.  “The State wanted to know that our owners were trustworthy people, and they wanted to see that the company was on firm financial footing”, said Tavarez.  Preferred Financial Services Corporation sees licensing as the simplest path to assuring consumers that they do good business. 

The debt settlement industry has been plagued by bad actors, the latest wave coming in the wake of the Federal Trade Commission’s ban on advanced fees.  Consumers seeking debt relief are bombarded with offers from attorney networks using their legal status as a loophole for the advanced fee ban.  The FTC’s ban on advanced fees work in concert with state licensing requirements; consumers should be wary of any company that offers debt relief while charging fees prior to executing a settlement. 

The company’s commitment to licensing and transparent business is distinguishing it from its competitors, “we anticipate that we will be the only debt settlement provider with licensing throughout the Mountain Region”, says Tavarez who oversees the company’s operations on a day to day basis.  The company says that its licensing initiative is at the core of continuing to develop their firm. 

Details on Utah licensing: Utah Division of Corporations & Commercial Code, P.O. Box 146705, Salt Lake City, UT, 84114-6705.   License number: 7953177-DBTM.

Settlements

Oregon grants Debt Settlement license to Preferred Financial Services Corporation

November 8th, 2011

Andover, MA, October 25, 2011: 

Preferred Financial Services Corporation continues to follow through on its strategic mission of becoming the leading debt settlement company in the industry, “gaining nationwide licensing is a key strategic initiative for us, we believe in regulation and legitimacy, sensible state regulation plays a big part in that” stated Gabriel Tavarez when asked about the importance of the Oregon license to the company.  The company had to undergo rigorous examination in order to meet the licensing requirements, an abbreviated list of requirements:

  • Accreditation of Counselors
  • Bonding
  • Certificate of Good Standing
  • Criminal Background Checks
  • Financials (business)
  • Insurance
  • Training
  • Education Material

Licensing requirements are designed to screen and evaluate everything about the company.  The State of Oregon wants to see that there are trained counselors dealing with their consumers.  Ample bonding and strict insurance requirements are also expected of licensees.  “The State wanted to know that our owners were trustworthy people, and they wanted to see that the company was on firm financial footing”, said Tavarez.  Preferred Financial Services Corporation sees licensing as the simplest path to assuring consumers that they do good business. 

The debt settlement industry has been plagued by bad actors, the latest wave coming in the wake of the Federal Trade Commission’s ban on advanced fees.  Consumers seeking debt relief are bombarded with offers from attorney networks using their legal status as a loophole for the advanced fee ban.  The FTC’s ban on advanced fees work in concert with state licensing requirements; consumers should be wary of any company that offers debt relief while charging fees prior to executing a settlement. 

The company’s commitment to licensing and transparent business is distinguishing it from its competitors, “we anticipate that we will be the only debt settlement provider with licensing throughout the Pacific States”, says Tavarez who oversees the company’s operations on a day to day basis.  The company says that its licensing initiative is at the core of continuing to develop their firm. 

Details on Oregon licensing: Secretary of State, Corporations Division 255 Capitol Street NE, Suite 151, Salem, OR 97311.   License number: DM80086.

Settlements

Nevada grants Debt Settlement license to Preferred Financial Services Corporation

November 8th, 2011

Andover, MA, October 25, 2011: 

Preferred Financial Services Corporation continues to follow through on its strategic mission of becoming the leading debt settlement company in the industry, “gaining nationwide licensing is a key strategic initiative for us, we believe in regulation and legitimacy, sensible state regulation plays a big part in that” stated Gabriel Tavarez when asked about the importance of the Nevada license to the company.  The company had to undergo rigorous examination in order to meet the licensing requirements, an abbreviated list of requirements:

  • Accreditation of Counselors
  • Bonding
  • Certificate of Good Standing
  • Criminal Background Checks
  • Financials (business)
  • Insurance
  • Training
  • Education Material

Licensing requirements are designed to screen and evaluate everything about the company.  The State of Nevada wants to see that there are trained counselors dealing with their consumers.  Ample bonding and strict insurance requirements are also expected of licensees.  “The State wanted to know that our owners were trustworthy people, and they wanted to see that the company was on firm financial footing”, said Tavarez.  Preferred Financial Services Corporation sees licensing as the simplest path to assuring consumers that they do good business. 

The debt settlement industry has been plagued by bad actors, the latest wave coming in the wake of the Federal Trade Commission’s ban on advanced fees.  Consumers seeking debt relief are bombarded with offers from attorney networks using their legal status as a loophole for the advanced fee ban.  The FTC’s ban on advanced fees work in concert with state licensing requirements; consumers should be wary of any company that offers debt relief while charging fees prior to executing a settlement. 

The company’s commitment to licensing and transparent business is distinguishing it from its competitors, “we anticipate that we will be the only debt settlement provider with licensing throughout the Mountain Region and West Coast”, says Tavarez who oversees the company’s operations on a day to day basis.  The company says that its licensing initiative is at the core of continuing to develop their firm. 

Details on Nevada licensing: State of Nevada Financial Institutions Division., P. O. Box 3239, Carson City, NV 89701.   License number: DMSM11020.

Settlements

Minnesota grants Debt Settlement license to Preferred Financial Services Corporation

November 8th, 2011

Andover, MA, October 25, 2011: 

Preferred Financial Services Corporation continues to follow through on its strategic mission of becoming the leading debt settlement company in the industry, “gaining nationwide licensing is a key strategic initiative for us, we believe in regulation and legitimacy, sensible state regulation plays a big part in that” stated Gabriel Tavarez when asked about the importance of the Minnesota license to the company.  The company had to undergo rigorous examination in order to meet the licensing requirements, an abbreviated list of requirements:

  • Accreditation of Counselors
  • Bonding
  • Certificate of Good Standing
  • Criminal Background Checks
  • Financials (business)
  • Insurance
  • Training
  • Education Material

Licensing requirements are designed to screen and evaluate everything about the company.  The State of Minnesota wants to see that there are trained counselors dealing with their consumers.  Ample bonding and strict insurance requirements are also expected of licensees.  “The State wanted to know that our owners were trustworthy people, and they wanted to see that the company was on firm financial footing”, said Tavarez.  Preferred Financial Services Corporation sees licensing as the simplest path to assuring consumers that they do good business. 

The debt settlement industry has been plagued by bad actors, the latest wave coming in the wake of the Federal Trade Commission’s ban on advanced fees.  Consumers seeking debt relief are bombarded with offers from attorney networks using their legal status as a loophole for the advanced fee ban.  The FTC’s ban on advanced fees work in concert with state licensing requirements; consumers should be wary of any company that offers debt relief while charging fees prior to executing a settlement. 

The company’s commitment to licensing and transparent business is distinguishing it from its competitors, “we anticipate that we will be the only debt settlement provider with licensing throughout the Midwest and the Great Lakes region”, says Tavarez who oversees the company’s operations on a day to day basis.  The company says that its licensing initiative is at the core of continuing to develop their firm. 

Details on Minnesota licensing: Minnesota Licensing Division, 85 7th Place East, Suite 500, St. Paul, MN 55101-3165.   License number: DS 10.

Settlements

Colorado grants Debt Settlement license to Preferred Financial Services Corporation

November 8th, 2011

Andover, MA, October 25, 2011: 

Preferred Financial Services Corporation continues to follow through on its strategic mission of becoming the leading debt settlement company in the industry, “gaining nationwide licensing is a key strategic initiative for us, we believe in regulation and legitimacy, sensible state regulation plays a big part in that” stated Gabriel Tavarez when asked about the importance of the Colorado license to the company.  The company had to undergo rigorous examination in order to meet the licensing requirements, an abbreviated list of requirements:

  • Accreditation of Counselors
  • Bonding
  • Certificate of Good Standing
  • Criminal Background Checks
  • Financials (business)
  • Insurance
  • Training
  • Education Material

Licensing requirements are designed to screen and evaluate everything about the company.  The State of Colorado wants to see that there are trained counselors dealing with their consumers.  Ample bonding and strict insurance requirements are also requirements of licensees.  “The State wanted to know that our owners were trustworthy people, and they wanted to see that the company was on firm financial footing”, said Tavarez.  Preferred Financial Services Corporation sees licensing as the simplest path to assuring consumers that they do good business. 

The debt settlement industry has been plagued by bad actors, the latest wave coming in the wake of the Federal Trade Commission’s ban on advanced fees.  Consumers seeking debt relief are bombarded with offers from attorney networks using their legal status as a loophole for the advanced fee ban.  The FTC’s ban on advanced fees work in concert with state licensing requirements; consumers should be wary of any company that offers debt relief while charging fees prior to executing a settlement. 

The company’s commitment to licensing and transparent business is distinguishing it from its competitors, “we anticipate that we will be the only debt settlement provider with licensing throughout the Mountain states”, says Tavarez who oversees the company’s operations on a day to day basis.  The company says that its licensing initiative is at the core of continuing to develop their firm. 

Details on Colorado licensing: State Services Building, 1525 Sherman Street, 7th Floor, Denver, CO 80203.   Registration number: 60.

Settlements

Arizona grants Debt Settlement License to Preferred Financial Services Corporation

November 8th, 2011

Andover, MA, October 25, 2011: 

Preferred Financial Services Corporation continues to follow through on its strategic mission of becoming the leading debt settlement company in the industry, “gaining nationwide licensing is a key strategic initiative for us, we believe in regulation and legitimacy, sensible state regulation plays a big part in that” stated Gabriel Tavarez when asked about the importance of the Arizona license to the company.  The company had to undergo rigorous examination in order to meet the licensing requirements, an abbreviated list of requirements:

  • Accreditation of Counselors
  • Bonding
  • Certificate of Good Standing
  • Criminal Background Checks
  • Financials (business)
  • Insurance
  • Training
  • Education Material

Licensing requirements are designed to screen and evaluate everything about the company.  The State of Arizona wants to see that there are trained counselors dealing with their consumers.  Ample bonding and strict insurance requirements are also expected of licensees.  “The State wanted to know that our owners were trustworthy people, and they wanted to see that the company was on firm financial footing”, said Tavarez.  Preferred Financial Services Corporation sees licensing as the simplest path to assuring consumers that they do good business. 

The debt settlement industry has been plagued by bad actors, the latest wave coming in the wake of the Federal Trade Commission’s ban on advanced fees.  Consumers seeking debt relief are bombarded with offers from attorney networks using their legal status as a loophole for the advanced fee ban.  The FTC’s ban on advanced fees work in concert with state licensing requirements; consumers should be wary of any company that offers debt relief while charging fees prior to executing a settlement. 

The company’s commitment to licensing and transparent business is distinguishing it from its competitors, “we anticipate that we will be the only debt settlement provider with licensing throughout the Mountain Region and West Coast”, says Tavarez who oversees the company’s operations on a day to day basis.  The company says that its licensing initiative is at the core of continuing to develop their firm. 

Details on Arizona licensing: Arizona Corporate Commission, 1300 W Washington Street, Phoenix, AZ 85007.   License number: DM-0918068.

Settlements

Sub-Prime Lending & the Credit Card Market

September 20th, 2011

The sub-prime credit card market is expanding, on its face its growth seems to be fueled by the ongoing recession.  A deeper look into the issue shows that although the recession is a contributing factor, it is likely not the key factor fueling the growth of this market segment in the credit card industry.   Instead banks’ inability to resell debt into bond markets, and the banks’ analysis of the cost of doing business are primarily responsible.

It’s impossible to disregard the global recession as a factor in anything finance or economy related, so a brief examination of the impact of the recession is essential.  The collapse of the real estate market and the corresponding calamity across Wall St. caused the greatest loss of wealth in history; in fact US families lost an estimated $11 billion in wealth in 2008.  Despite the losses there is no documented evidence reflecting that US consumers’ credit ratings have changed materially, in fact the average national credit score rates the US consumer as a ‘good’ credit risk. 

The rise of securitization fueled the expansion of credit card debt in the US during the credit boom of the early and mid part of this decade.  Securitization is a process by which banks convert receivables into cash, by converting pools of debt into bonds which are then sold to third party holders.  Those third party holders are then entitled to the future payments on those accounts.  Securitization allowed credit card issuers through the early part of this decade to lend, create pools, convert to bonds and cash out with relatively little risk.  Bankers could lend, re-sell and cash out without worry; they traded the risk once they created and sold the bond. A key statistic, in 2006 revolving debt (98% credit cards) stood at $900 billion for US consumers.  Of the $900 billion in revolving debt over $414 billion was securitized.  By second quarter 2011 revolving credit card debt stood at $789 billion of which only $40.7 billion was securitized. 

The evaporation of the bond market for credit card debt has forced banks to re-think their product strategy.  While the credit worthiness of the average US consumer has remained stable, the profitability of a loan to a prime consumer has gone down.  During the credit boom it was acceptable to generate less profit per credit line granted.  The risk of default was passed along to the bond holder, and the line of credit once packaged and sold generated cash.  The inability of banks to re-sell into the bond market has forced them to adjust interest rates to match risk, and boost profits.

Interest is a risk management instrument; as such its fluctuations are dictated by market forces.  The credit card market has forced banks to increase interest rates, and fees in order to properly account for potential losses in their portfolios (something that wasn’t critical to their success when they were able to sell the debt).  This move toward higher charges has pushed prime consumers out of the market and has predicated bank product strategy toward sub prime consumers.  This change in strategy has had a direct impact on consumers, forcing them to make decisions on what they are willing to pay in order to borrow.

The shift in cost for borrowing has increased dramatically for prime consumers – American Express recently increased interest rates on its Gold Delta Skymiles and Platinum Delta Skymiles products from a flat annual percentage rate of 14.5 to a range of 15.24 to 19.24.  These dramatic shifts in the cost of borrowing are reflective of the increased risk of the credit card product.  These radical shifts in pricing have pushed the very best consumers out of the credit card market; prime consumers have stopped using the cards.  There hasn’t been a commensurate increase in interest rates for sub prime credit cards as they were always risky, and priced accordingly. 

Settlements

Problems to be Considered by Sub Prime Lenders

September 20th, 2011

Sub prime lending is the only growth sector in consumer finance.  Lenders have made the decision to grow their business by expanding these products in response to a re-calibration of risk, and the search for profitability.  Lenders should be cautious when wading in, if the past is an indicator of the future lenders have losses looming.  This article highlights three key reasons why sub prime lenders face a tough road as they expand into sub prime lending.

1.  Its not new: the pursuit of the sub prime consumer is not new, Providian, HSBC, Visa are examples of large entities pursuing the market aggressively.  Providian & HSBC met with disastrous consequences – Providian is out of business and HSBC has pulled a significant portion of business out of the US market altogether.  If the basis for evaluating sub prime is consumer analytics you have to assume that these companies had a hold of those numbers, yet they still failed to make it work long term and met with disastrous losses.  Visa continues to operate in the space but their model virtually eliminates risk, pre paid cards are purchased and funded with the consumer’s cash and revenues are derived from retailers on a transaction basis; there is no loan, there is no substantial risk.  So, while the growth in lending is in the sub prime segment there’s no evidence to prove that a lending model is viable over the long term particularly with the current behavioral issues on the recovery side.

2. Analytics: its impossible to accurately predict or chart the behavior of the sub prime borrower.  If we take a look back and use Stockton, CA during the mortgage crisis as a basis for analyzing the behavior of the consumer we’ll find some disturbing aberrations from standard/accepted consumer patterns.

a. Stockton consumers deserted their homes. 

b. Stockton consumers were unconcerned about the ramifications of default.

c. Stockton consumers continued paying credit cards during foreclosures.

Until the mortgage crisis it was unheard of for a borrower to stop paying on a note intentionally; Stockton residents did it in droves.  During default and foreclosure proceedings these consumers thumbed their noses (in a manner of speaking) at their mortgage lenders by continuing to pay unsecured lines of credit.  We can only speculate as to the reasons why a person would stop paying for their house, but keep paying for a 40″ inch high definition TV.  We can make assumptions and derive reasons, but the fact is that on its face this type of behavior is completely illogical and as such any patterns that we chart are inherently unrealiable.  If you can’t accurately analyze the risk of the loan its impossible to create a proper revenue model.

3.  What do these consumers have to lose?  The traditional relationship of a lender and a consumer is based on the consequence of default.  The consumer needs a loan or a revolving line of credit they approach the lender and make a request, the bank then issues a loan.  Once the consumer has the loan the things they do with that money is predicated by their knowledge that they stand to lose something if they fail to pay the money back.  A first time borrower is really aware, they want to make good on the note because they don’t want to face the consequence of default which they may view as harsher than it may be.  The sub prime consumer almost by definition bucks this dynamic, they’ve defaulted in the past so there is no mystery about the consequence as a result their willingness to decide to forgo payment is likely; in a sub prime setting you can expect high numbers of borrowers to have intentionally defaulted.  The consequences of this fact could be devastating to the lender.

Settlements

New Home Sales Continue to Fall….

August 8th, 2011

Andover, Massachusetts August 8th 2011— Are you finally seeing the light at the end of the tunnel when it comes to your finances? Did you recently get a raise at work or finally find a job again after being unemployed due to the worst economy in recent memory? If so, congratulations, but stay weary, there are still threats lurking that could throw you and your family back into the same boat you just escaped from.

 

For many Americans the housing collapse was and still currently is the biggest drag on their finances. Many families never faced job losses but due to drastically declining home prices their previously “smart” investments turned into nightmares as they were underwater by $50,000, $100,000, or more. While economy has turned around and unemployment seems to be getting slowly better, the housing market continues to slump. The latest figures for June point to continue decreases in home prices and a slowdown in the number of new homes being built, a key indicator of not only the housing industry but the economy as a whole. Each house built adds tens of thousands of dollars to the local economy and creates jobs for everything from construction workers to food services. New home sales slipped to 312,000 in June from 315,000 in May. While this is an increase of 1.6% from June 2010, it is still close to 1 million homes lower than the all time reached in 2005. Clearly, there is room for improvement, and until the housing sector rebounds for good, we will continue to see homeowners in trouble.

 

As a sign that the struggle continues for people looking to sell their homes, home prices dipped 4.5% in May for the 20 major urban areas of the US. While this may be good news for prospective buyers looking for the best deal possible, the continued drop in prices will lead many to put off purchasing new homes in case they can get a lower price down the road. This trickle down effect will continue to hurt everyone involved in the housing industry in ways that are not often mentioned. The more existing homes on the market, the lower the new home sales will be and the less new houses will be constructed. The longer it takes for a homeowner to sell his/her home, the greater the chances are of them facing a foreclosure due to sky high mortgage payments on a property that is worth less than they owe. As you can see, this can be a devastating cycle, so let’s hope it turns around soon and we can begin talking about more promising economic news.

Settlements

New Down Payment Requirements Pose a Challenge to the Housing Market

August 8th, 2011

Andover, Massachusetts August 5th 2011— Remember the days when a typical down payment on a home was 20% or more? Probably not since those times are long gone. The relaxation of financing requirements and the popularity of exotic new mortgage plans meant that many Americans were able to get approved for mortgages with as little as 1% set aside as a down payment. The end result of this boom in homeownership we experienced over the past 15+ years was the largest economic downturn since the 1930’s. The housing market collapsed and now millions of Americans own homes that are underwater with values that continue to decline in the major housing markets nationwide.

 

The financial regulations reform bill that was passed last year had a few provisions in it that are meant to clean up the lose lending requirements so as to prevent a repeat of this disaster in the future. However, many influential voices in the industry believe that higher requirements for a down payment will be just another blow to an already battered housing sector. The requirements being floated around Washington would make it much harder for homeowners to get approved for a mortgage without a sizeable down payment, at least 10% and up to 20% depending on the credit history of the consumer. Although the intent of this bill is to minimize the number of consumers who are given mortgages that they can not afford, the end result will mean that it will become very difficult for even credit worthy consumers to get a home mortgage. According to national data, 80% of the mortgages approved over the past decade would not meet this criteria and it would take about 10 years for the average American family to save enough money to put down 10% on an average home. As you can see, these restrictions will severely limit the number of approved borrowers at a time when the housing market needs help from Washington to boost demand and get the housing sector roaring again.

Settlements