Preferred Financial Services

Preferred Financial Services, Inc reviews and discusses the upcoming Financial Regulation Reform Package currently being debated in congress…

Andover, Massachusetts May 1st 2010—Preferred Financial Services has reviewed the Financial Regulation Reform Package proposal currently before congress and wants to make sure Americans know how this will affect them and not just Wall Street. This financial reform was first proposed last year as the financial crisis was winding down and banks were not facing ever rising default rates and credit shortages. The reform is meant to prevent a future Wall Street collapse and bail out while protecting consumers from the reckless risk taking that epitomized the Wall Street excesses of the early 21^st century.

The changes impact everything from consumer protections to financial products and future bailout procedures. The biggest change for everyday consumers will be the creation of a Consumer Financial Protection Bureau housed in the Federal Reserve building. It will be independent of the Fed and won’t have to answer to the Fed Chairman. Its purpose is to educate and protect Americans from exotic credit products that proliferated in the past decade including sub prime mortgages, financial derivatives, and lax credit worthiness checks. This new agency will educate consumers about all the products out there and give access to less risky products that are more consumer friendly.

The recent financial meltdown is very different from past recessions as many of the exotic and less regulated products that partly caused the meltdown did not exist then. Derivatives and securities that were bundled together and sold to investors were not regulated like regular financial products. These new regulations will place them under the same supervision as other products. They will be traded openly on exchanges just like regular products and the originator firms of the products will be forced to keep some collator on hand to control losses and risk taking. Not only that, but deposit taking banks will no longer be allowed to deal in them as they represent to large of a risk for average consumers and should be confined to investment and large scale commercial wealth management institutions.

A contentious part of the proposed reform is how to deal with a future meltdown and the financial firms at the center of it. The proposed idea would be to create a fund using financial sector money that would be used to dissolve future financial firms when they run into another meltdown like the one we just experienced. It is being opposed by some who see it as another form of a bailout that does not allow the free market to just eliminate unprofitable firms.

Another populist reform measure that is being considered would give the right to shareholders of publicly traded firms to hold a non binding vote on executive compensation. Executive pay has been a very polarizing issue since the economy collapsed and there is a lot of political and public support to bring their pay into line with the performance of their companies. Poorly managed firms should not reward their executives with outrageous bonuses.

All these reform ideas face a long and arduous political process that will surely eliminate and revise many of the ideas. Wall Street opposes any regulations that limit its freedom to work the markets and make a profit for shareholders. Republicans want to allow the free market to do its job while Democrats want to protect Americans from the predatory practices that ruined millions of families over the past 3 years. All three viewpoints need to reconcile so a package can be passed. The process is ongoing and politicians are attempting to complete and have the reform package signed into law before the summer recess begins in early August.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

Contact:

Stephan Tavernini

stavernini@pfs1.net

www.pfsdebtrelief.com

Citations:

• http://www.senate.gov/artandhistory/history/common/generic/News_August_Recess.htm
• http://images.usnews.com/money/blogs/the-home-front/2009/06/17/obamas-financial-regulation-reform-7-things-you-need-to-know
• http://www.huffingtonpost.com/2010/03/15/dodd-unveils-financial-re_n_499569.html

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Preferred Financial Services, Inc reviews and discusses the most recent Household Debt Service and Financial Obligations Ratios data released by the Federal Reserve …

Andover, Massachusetts April 26th 2010—Preferred Financial Services has reviewed the most recent data released by the Federal Reserve in regards to household debt ratios and continues to see signs that the economic recession has changed consumer habits in the short term. The verdict on any long term change is still up for discussion as not enough time has passed for accurate predictions to be made.

As expected, the household debt (mortgage and consumer debt) to disposable personal income ratio continues to drop, hitting a 9 year low of 12.6. This means that 12.6% of all the disposable personal income of the average American is going towards debt service payments. This ratio went as high as 13.92 in the first quarter of 2008. This was the peak of the economic bubble where people were maximizing their debt payments to sustain a lavish and unsustainable lifestyle. As the economy started to falter and household income and spending took a hit due to property value plunges, foreclosures, job losses and income insecurity, this ratio has been on a steady decline.

This decline proves that Americans have changed their spending habits due to the economy, something that was not a foregone conclusion when the economy first started to slow down. The question everyone is asking now is if the old habits will reappear once the economy improves or if Americans have actually changed how they live and manage their finances. If we do revert back to our old spending habits, our economy might improve quicker due to higher consumer spending and thus economic growth. However, that means we didn’t learn from our past mistakes and are setting ourselves up for a repeat of the disaster of 2008. If it is a permanent shift in consumer spending, past assumptions about the American economy and the strength of consumer spending will not be true anymore. Consumer spending has been the engine of growth for the American economy since the end of World War 2, are we witnessing a fundamental shift of the American consumer? Only time will tell.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit: www.pfsdebtrelief.com

Contact:

Stephan Tavernini

stavernini@pfs1.net

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Preferred Financial Services, Inc reviews and discusses recent financial data on consumer credit released by the Federal Reserve…

Andover, Massachusetts April 20^th 2010 – Preferred Financial Services has reviewed the most recent consumer credit report released by the Federal Reserve in early April and has found some interesting and thought provoking information in it related to how Americans are spending their money in this economy.

As expected, with the still faltering economy and high unemployment rate consumer credit has decreased quite substantially as American families are still worried about the economy and their personal finances. This drop in credit tends to signal that consumers do not believe the economy in general and the job market in particular has turned the corner completely. If they did, the credit use by consumers should be trending upwards not downwards as consumer spending increases.

The numbers also show that Americans are relying less and less on revolving credit and more and more on non revolving credit which once paid off can not be used again. Typical examples of this are car loans and student loans. Revolving credit, which is typical credit card debt, dropped an astounding 13% in February. Non revolving debt only dropped 1.3% on an annual basis in February. This disparity leads us to say with a high degree of certainty that Americans continue to limit their personal non essential expenses in these tough economic times.

The report goes on to state that total consumer debt has decreased by close to 40 billion dollars from January to February. Before this recession Americans had peaked their personal debt at close to 2.6 trillion dollars in the 4^th quarter of 2008. As the economy soured and Americans reigned in their debt, it has dropped to 2.45 trillion. The continued drop also signals that Americans are paying off their debt and not creating new debt. This is very important as it could signal a fundamental shift away from living on credit to a more responsible financial landscape.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit: www.pfsdebtrelief.com

Contact:

Gabriel Tavarez

gtavarez@pfs1.net

866-992-7400

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Are you at a point where you don’t know what to do about your debt anymore? Are you thinking about filling for bankruptcy? What exactly do you know about the process of bankruptcy and how it works? Are you even sure this will help you more then it will hurt you? These are all questions you should ask yourself before you do something as drastic as bankruptcy.

For starters, bankruptcy is and always has been the last option for consumers looking to resolve their outstanding debt situation. You should always look for an alternative to bankruptcy when possible. In the past, it was relatively easy to file for bankruptcy but it still ruined ones credit history. Since the changes in bankruptcy laws a few years ago, the process of filing for bankruptcy has become more complicated and also more expensive. Consumers like you have to enroll in pre filing credit counseling, pass a means test to prove they are incapable of paying back their debts, as well as enrolling in a mandatory credit counseling session after the bankruptcy process is complete.

If you do decide for this option, the first question you have to ask yourself, “What type of bankruptcy do I want to file for?” There are two types of bankruptcy filings, chapters 7 and 13. In a chapter 7 filing, all the assets are liquidated (sold) except those exempt by state or federal law and the proceeds are used to pay off the outstanding creditors. In a chapter 13 filing, you are allowed to keep necessary assets and you enroll in a structured repayment plan usually over a 3 to 5 year period. Contrary to popular belief, in this type of filing you can typically expect to pay back 30% to 100% of your outstanding debt.

If all of this hasn’t encouraged you to reconsider yet, the cost of filling for bankruptcy is far reaching both financially and socially. Financially, the cost of filing has been going up for years. The initial filing fees total about $300, which seems relatively modest. However, you need to hire a lawyer to do this, and these costs can range upwards of $1000. Besides a short term hit to your pocketbook, a bankruptcy filling is a public record that is reported for seven to ten years after the filing to the credit bureaus. Due to this, your future ability to obtain new lines of credit, jobs or even insurance is greatly hampered by a bankruptcy filling. A quick Google search of your name will show the world that you filed for bankruptcy. On top of all this, a bankruptcy filing is embarrassing to you and your family. It will make you feel inadequate and incapable of meeting your obligations. Everyone wants to have the ability to pay for their bills, so consider that when you are deciding to go the route of bankruptcy.

Whichever filing you end up choosing if you do go the bankruptcy route, the hope is that you will have learned from past mistakes and will do your best not to file again in the future by living within your means. Hopefully you will have learned to effectively manage your debt better in the future. Bankruptcy is the one option you should try and avoid at all costs. The black mark of a bankruptcy filing on your credit report can ruin areas of your life that you never thought would be affected, so tread carefully when deciding that bankruptcy is your only option.

www.pfsdebtrelief.com

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We negotiated another great settlement for one of our clients from California, who enrolled in August,2009. The original balance was $18,396.96, and we settled it for $5897.00 This is a savings of 63%!

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