THE BLOG

24
Dec

Payday Loan Portfolio Sales

Payday Loan & Installment Portfolio Sales & Bad Debt Chargeoffs

$112,000,000 in bad debt sold for $1,700,000 by Regional Management Corp.

Regional Management Corp. (NYSE: RM), a specialty consumer finance company, announced  that it has completed the sale of approximately $112 million of its existing charged-off loan portfolio. (Man, that’s gotta hurt!)

How to start a car title loan businessPre-tax proceeds from the one-time sale of the existing charged-off loan portfolio, net of commission and other expenses, were approximately $1.7 million, and will be recognized in the fourth quarter on Regional Management’s income statement as a reduction of its provision for credit losses.

Proceeds from the sale of forward flow charged-off accounts will be received by Regional Management on a monthly basis.

Regional Management Corp. (NYSE: RM) is a diversified specialty consumer finance company providing a broad array of loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies and other traditional lenders.

Regional Management began operations in 1987 with four branches in South Carolina and has since expanded its branch network across South Carolina, Texas, North Carolina, Tennessee, Alabama, Oklahoma, New Mexico and Georgia.

Each of its loan products is structured on a fixed rate, fixed term basis with fully amortizing equal monthly installment payments and is repayable at any time without penalty. Regional Management’s loans are sourced through its multiple channel platform, including in its branches, through direct mail campaigns, independent and franchise automobile dealerships, online credit application networks, retailers and its consumer website.

For more information, please visit http://www.RegionalManagement.com. Contact: Investor Relations Garrett Edson, (203) 682-8331

01
Dec

Update: Payday Loan Business-Consumer Financial Protection Bureau

The CFPB Consumer Financial Protection Bureau & the Payday Loan Industry

Payday loans, auto title loans, and similar lending products: update from The CFPB

We’ve written often here about the issue of payday loan State’s rights versus the Fed’s and the CFPB.

The CFPB issued an update on their website regarding proposed rulemaking for car title loans, payday loans, installment loans, line-of-credit loans and related loan products made to consumers in the U.S.

Here’s the the CFPB release in full including 3 links to their “research” and “studies.” Take a deep breath and hold your nose…

The CFPB press release and website Post specifically state:

“The Bureau is in the process of developing a Notice of Proposed Rulemaking to address concerns in markets for payday, auto title, and similar lending products. The Bureau is particularly concerned that lenders are offering these products without assessing the consumer’s ability to repay, thereby forcing consumers to choose between reborrowing, defaulting, or falling behind on other obligations. We are also concerned about certain payment collection practices that can subject consumers to substantial fees and increase risk of account closure.”

The CFPB announcement went on to say:

Jer Trihouse Consulting

Jer Trihouse

“The Notice of Proposed Rulemaking will build on feedback we have received from small businesses and other stakeholders after releasing an outline of proposals under consideration last spring for purposes of the Small Business Regulatory Enforcement Fairness Act process. The Bureau will also publish results of further research it has been conducting into these markets in connection with the rulemaking proposal. The Bureau previously released a white paper and a report summarizing some of its research on some of these products. We expect to release the rulemaking proposal in first quarter 2016.”

Here’s a direct link to the CFPB’s “Small Business Regulatory Enforcement Act process (CFPB 1)

And a link to the previous CFPB Payday Loan White Paper, “Payday Loans and Deposit Advance Products: (CFPB 2)

And the CFPB Report, “CFPB Data Point”: (CFPB 3)

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