A license to steal?! Credit card companies, mortgage companies, investment brokers, and insurance companies are beginning to see that a quick buck up front for them is costing the American people a lot more in the long run for funny banking rules. Funny banking rules? What is that? Simply put, it is the way that these companies have been allowed to legally rip off the American people while padding their pockets with your money.
Have you ever missed a credit card payment by a day and find that you are charged a late fee, which put you over your limit, then charged an over-the-limit fee, which made your finance charge increase from 9% to 24% because you broke one of those rules written somewhere in the fine print of your agreement? If this has happened to you, you are in good company. It has happened to a good number of others as well. There are also loop holes that also allow your beloved credit card companies to charge you finance charges on your account even if you paid your balance to zero. There has been much press these days on the facts about paying only the minimums on your accounts. If you had a $5,000 balance and paid the minimum payment each month, you will pay that off in approximately 30 years. These are only a few things that credit card companies can do to reach into your back pocket and reach for that extra dollar. Greed, is there anyone who has been more greedy than these companies? I'm sorry to say it, but, yes.
The real greed has been found in the mortgage industry. As a member of the financial industry, it sickened me to find that someone had been put into a $180,000 45 year Interest Only Balloon loan where at the end of the 45 years they owed $180,000 in one lump sum or lose the house. How is this legal? How is it right and ethical on any level? This is just one of the cases that has been uncovered by my office. It was done to get this poor family into a house that they could not afford, and one that they would never pay off. If they did not refinance this mortgage they would have paid on this house the majority if not all of their adult lives to only lose it in thier old age. I do not think Social Security would be enough to cover a $180,000 lump sum payment. If they had not saved this money in an investment of some kind (401K, 403b, etc.) this family would have to be ready to give up their longtime family home. This is greed at its worst. The sad thing is there are so many of these mortgages and those like them that it has played a major part in sending our country into an economic tailspin. The really sad thing is the people targeted in these kinds of mortgages is the middle income and lower income families. These "rules" were put into place to help people in these categories to afford homes that otherwise they could not afford to pay for. It brought monthly payments down so the little guy could afford it (or so it seemed)
The number one thing to look for when looking at a mortgage document is the "Truth In Lending" page that has four boxes across the top. To find out if you have a fixed mortgage or one with some kind of crazy "rule" to it, you should look for the box with the payment amounts. If there is more than the monthly payment and last payment BEWARE! That is the quickest way to see what kind of mortgage you are getting into.
Investment brokers tend to not look at you if you do not have at least $100,000 at your fingertips and ready to invest with them. Very few companies out there are willing to work with the 80% of people that fit into the category of Middle America. By looking only for those guys and gals with the big bucks to invest is the first thing that should send off the Greed Alarm in your head when you go to invest. Being educated on the differences of stocks, bonds, and mutual funds would be of great importance to any investor.
There are four major things to look for when you are purchasing a life insurance policy.
1. Is it for life? Or is it only for the term that you need it (until you are self-insured and have enough money accumulated that paying premiums are no longer logical)?
2. Are there investment attachments that allow you to borrow your own money and repay it for a cost of interest or lessening your death benefit? Or is it pure insurance with no attachments?
3. What happens for the first few years of your policy? Are your premiums put into an account and held until you have paid enough to cover the commissions and fees of the agent and company? Or is your policy effective immediately upon payment of your first premium?
4. Who gets your money when you die? And how much do they get? Do they get both the accumulated amount in your "investment" and the noted death benefit? Do they only get the death benefit? Or do they get a death benefit from the insurance company and also become beneficiaries of an investment?
When looking for a policy, make sure to ask these questions and make the best decision for your situation. This will help to keep your premiums low and keep the greedy sales people from taking your hard earned money.