Bankers Pledge New Resources to Financial Literacy

Bankers are mounting their support for national efforts to build up a much-needed financial literacy foundation.

Individually through its members and collectively as a group, the Mortgage Bankers Association is playing a more active role in financial education.  

It recently introduced Financial Fitness USA, an industry wide educational initiative designed to help consumers become more financially literate. The program is powered by new software that was specifically developed for the MBA by EverFi, a software company that specializes in financial-literacy.

The MBA said it is offering the program free of charge to real estate finance industry members who on average employ over 280,000 people “in virtually every community in the country.” The goal is to enhance their homebuyer and homeowner customers’ understanding of mortgages, credit scores, and other financial issues and to connect people in need with adequate services.

Hence the program’s impact is expected to be significant especially in the communities that still are struggling because of the crisis.

In addition to the EverFi@Work tool, the MBA also offers a free Home Loan Toolkit Mobile App at and the Android toolkit. Features include: A calculator of the maximum mortgage payments a borrower can afford; A mortgage terms glossary; An exclusive aggregated interest rate feed from MBA’s Research and Economics group.

HomeLoanLearningCenter.com, also powered by the MBA, provides free advisory support to potential homebuyers and current homeowners who want to make long-term financial decisions about their financial future.  

This approach to customer financial education is gaining support from lenders, servicers and other entities alike.

Nationwide Title Clearing, Inc., of Palm Harbor, Fla., which has been providing post-closing services to residential mortgage lenders, servicers and investors for over 20 years, is a strong supporter of the program.

NTC is promoting the program because it helps bank consumers better understand financial processes and thus helps improve the overall banking experience for borrowers and bankers alike, says the firm’s CEO John Hillman.“When consumers are ‘financially fit’ and in control of their finances, they are more at ease and make better educated decisions.”

Plus, since “mortgage industry terms and processes are difficult to understand for most people,” programs like this help potential homebuyers and current homeowners not fall victim to fraud schemes.

Even though a housing market recovery is in progress, it is so slow that the financial interests of bankers and borrowers remain in a symbiotic relationship.

According to the most recent findings from a survey by the Consumer Federation of America and the North American Consumer Protection Investigators, based on information provided by 38 agencies across the country, besides cars, credit and home repair and construction once again topped the list of the most common, fastest-growing customer complaints.

For the first time complaints made to state and local consumer protection agencies about the marketplace in 2011 included real estate related issues.

Bankers and their customers are concerned about how the post-crisis banking system is changing through regulation and new trends.

Customer advocacy groups applaud and support increased banking oversight.

Among others, director of consumer protection at CFA Susan Grant finds state and local agencies “are essential components” of the nation’s consumer protection system because their services “save consumers and businesses money, relieve the burden on courts, foster confidence in government, keep the public safe, and help ensure fairness in the marketplace.”  

And to be able to do that consumer protection agencies need information and data compiled through different means, including surveys that help these entities “follow trends in consumer fraud, educate the public, and share information with each other,” adds interim president of NACPI, Tonya Hetzler.

Credit and debt issues may stay on the top-ten customer complaint ranking for more years to come.

Billing and fee disputes, mortgage modifications and other mortgage-related fraud, credit repair, debt relief services, predatory lending, illegal or abusive debt collection tactics are not easy to resolve.
Real estate sales and re sales fraud keeps evolving.

Home improvement and construction related problems, disputes between landlords and tenants over unhealthy or unsafe conditions, failure to make repairs or provide promised amenities, deposit and rent disputes, or illegal eviction tactics also concern everyone. Moreover these issues have changed with the times by new concepts, such as the REO-to-rent for example.  

The survey found the top five fastest-growing complaints were about fraud, debt collection abuses, mortgage-related problems, and home improvement. In other words, they involved mortgage-related problems, home improvement, Internet sales, and fraud.

A major challenge state and local consumer protection agencies faced last year was budget cuts and limited resources, which were frequently cited as the biggest problem.