April, 2016
Feature Article
10 Ways to Fight Identity Theft
Inside Improving Your Financial Health Cybercrimes Enforcement $4.95
Reputation Risk: A Look at Social Media
Contents
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The TRUE Community Bank
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10 Ways to Fight Identity Theft
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Community banks have and will again stand the test of time because we continue to stay together. The TRUE Community Bank marketing campaign is just another tool to assist community banking in our quest to survive and thrive in our communities. By Jeff Adkins, President & CEO, National Community Bankers
In an era of high-speed communication and high-tech toys, the miracles of technology are constantly making the impossible possible. But, while improvement and progression are valid grounds for excitement, the same technology that makes our time so much more efficient is increasingly dangerous if we let it fall into the wrong hands. By Amanda Oswald
Thinking of Refinancing? Things You Must Know Before You Refinance
By reviewing your options, you can find the best ways to decrease payments and interest, thereby freeing up cash that can be then used to eliminate your debts and accelerate the payoff of your home. By Roger Morris, Old Town Mortgage Services, LLC
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Reputation Risk: A Look at Social Media
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Helping First-Time Homebuyers Afford the American Dream
Whether your bank has chosen to participate in the world of social media or not, you still need a risk management plan. By Gene Sutherland, Security Risk Management
Preparing for home ownership requires you to carefully examine your finances and your expectations so that your purchase will be a source of pride and happiness in the future and not a source of stress. By Mark Johnson, American Bankers Company
Upcoming Events Education Calendar
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EDITORIAL:
The National Community Bankers seeks to reflect news and information of direct interest to member of the Community Bankers Association. Statement of fact and opinion are made on the responsibility of the authors alone and do not represent the opinion or endorsement of the Community Bankers Association. Articles may be reproduced with written permission only.
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Letter From the Editor
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ast month at the Community Bankers Day on the Hill we unveiled the TRUE Community Bank marketing program for our member banks. This program was designed to enhance our members’ marketing programs and to assist their employees in explaining to their customers what it means to be a community bank and to identify which banks are true community banks. We developed a TRUE Community Bank logo to show the public which financial institutions are true community banks. Several of our member banks have embraced the program and have incorporated the TRUE logo into their advertising. But what is a TRUE community bank? How do you identify a TRUE community bank? TRUE community banks focus their attention on the needs of customers, employees and shareholders in a balanced approach. Community banks utilize local deposits to reinvest in neighborhoods and businesses where their depositors live and work. Community bank employees are typically strongly involved in local
Quest to Survive and Thrive community affairs and activities. Community bank senior officers are accessible to each customer on site with decisions on loans being made locally. Community banks are willing to consider significant attributes such as a person’s character when making loans and don’t just rely on a computer formula to make loan decisions. Community banks are themselves small businesses, so they understand the needs of the small business owners. Community banks pay local, state and federal taxes which in turn support local governments and schools in their communities. These are several attributes that describe a community bank. The most important characteristic is that business decisions are being made by local people to provide necessary products and services to residents in which the bankers live and work. As the TRUE Community Bank marketing campaign gains momentum and more community member banks embrace the program, more citizens will begin to understand what a TRUE Community Bank is and what they stand for.
Community Banks are the small business igniter and jobs creator in your community. Community banking has been dealt a few bad hands over the last several years, and we have had to play the cards we were dealt. We have suffered through tough financial times that were created by non-community banks, but we have stuck together through these times although we have lost some of our peers as a result. Our community banks have and will again stand the test of time because we continue to stay together. The TRUE Community Bank marketing campaign is just another tool to assist community banking in our quest to survive and thrive in our communities.
Jeff Adkins President & CEO, National Community Bankers
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10 Ways to Fight Identity Theft By Amanda Oswald
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n an era of high-speed communication and high-tech toys, the miracles of technology are constantly making the impossible possible. But, while improvement and progression are valid grounds for excitement, the same technology that makes our time so much more efficient is increasingly dangerous if we let it fall into the wrong hands. With just a few numbers, an identity thief can empty your bank accounts, open and max out new credit card accounts, and basically turn your life upside-down before you know what hit you. Identity theft is one of the most widespread and fastest-growing crimes in the world, but it doesn’t have to happen to you. Here are fifteen ways to avoid identity theft: 1. Check your credit report! What you don’t know can hurt you, so make sure you know what’s on your credit report and how it got there. Each credit card bureau is required to give you one free copy of your credit report each year.
2. Buy a shredder. U.S. households received approximately 5.3 billion offers for new credit cards. Bank and credit card statements, as well as unsolicited junk mail, Ware often just what an identity thief is looking for. Your best bet is to shred any documents that have personal information, including your name and address. 3. Only carry what you need. A wallet full of cards, checks, and cash provides you with lots of options, but it does the same for any thief who may get their hands on it, and you will have a lot less headache reporting one card stolen than if you have to report a whole wallet-full. Knowing where you’re going ahead of time and how much money you plan on spending will help you determine what you need with you, and help you avoid wasting money on unplanned spending.
“Identity theft is one of the most widespread and fastest-growing crimes in the world.”
4. Debit or credit? Today, debit cards account for thirty-three percent of in-store transactions versus only nineteen percent for credit cards. While that may point to a trend toward a bit more financial responsibility, it also points to increased chances of identity theft. When you contest charges made to your debit card, the money has already been withdrawn from your account, and if that withdrawal means an overdraft in your account, the bank is not required to repay the overdraft charges. 5. Opt out of unsolicited credit card offers. Call 888-567-8688 (supported by the consumer credit reporting industry). It will probably take about three months to stop the flood completely, but the sooner you start, the sooner you can get there. In the meantime, never respond to unsolicited offers. If an offer looks tempting, you should be able to get it in a store or online. Unsolicited ads work on a two-percent success rate. That means that if only two percent of the people that receive that annoying junk mail actually reply, the company has made a profit from it, and will continue to use those mailing lists. By opting out, you’re doing everyone a favor.
6. Watch where you swipe. This way you can avoid “skimming.” A skimmer is a small electronic device that can be placed right over the slot where you swipe your card on the ATM. Don’t use an ATM if you notice that the scanning device looks suspicious. If there are signs posted asking that you input your PIN multiple times, or if an attendant or stranger offers to help you with a malfunctioning machine, cancel the transaction and walk away. 7. Use different passwords for different accounts. Mix numbers and letters, upper-case and lower-case to be sure your accounts are safe from anyone who might want to gain access to them. Simple words make the most easily cracked passwords. 8. Don’t open or respond to email from anyone you don’t know. Never respond to emails from banks asking you to give out personal information. More often than not, those emails are not from someone helping you manage your account, but from someone who wants to get their hands into it. Never send your bank account, social security number, or any other personal information to someone you don’t know.
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9. Pay your bills online. Online services are generally very secure, and the fewer bills and checks you have floating around, the better. By paying your bills online, you lessen your chances of identity theft and use a lot less paper. 10. Enroll in online banking. Not only will this keep your account information out of malignant hands, it will also allow you a better handle on your account. You’ll be able to track your balance and see, almost immediately, if a charge is made by anyone but yourself.
If Your Identity Is Stolen If you are a victim of identity theft, take the following steps as soon as possible, and keep a detailed record of your conversations, as well as copies of all correspondence. Place a fraud alert on your credit reports and review your credit reports.
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Fraud alerts can help prevent an identity thief from opening any more accounts in your name. Continue to check your credit reports periodically, especially for the first year after you discover the identity theft, to make sure no new fraudulent activity has occurred. Close the accounts that you know, or believe, have been tampered with or opened fraudulently. Call and speak with someone in the security or fraud department of each company. It’s important to notify credit card companies and banks in writing. Send your letters by certified mail, return receipt requested, so you can document what the company received and when. Keep a file of your correspondence and enclosures. If the identity thief has made charges or debits on your accounts, or has fraudulently opened accounts, ask the company for the forms to dispute those transactions. Once you have resolved your identity theft dispute with the company, ask for a letter stating that the company has closed the disputed accounts and has discharged
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the fraudulent debts. This letter is your best proof if errors relating to this account reappear on your credit report or you are contacted again about the fraudulent debt. File a report with your local police or the police in the community where the identity theft took place. Call your local police department and tell them that you want to file a report about your identity theft. File a complaint with the Federal Trade Commission. By sharing your identity theft complaint with the FTC, you will provide important information that can help law enforcement officials across the nation track down identity thieves and stop them. The FTC can refer victims’ complaints to other government agencies and companies for further action, as well as investigate companies for violations of laws the agency enforces.
Thinking of Refinancing?
Things You Must Know Before You Refinance By Roger Morris, Old Town Mortgage Services, LLC It’s Not the Rate; it’s the Fees.
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get field calls daily from clients wondering about the interest rate and whether or not they can save a few bucks on their payments. How come no one asks about fees? When shopping around, why do most homeowners worry about the 1/8 percent difference between rates from one company to the next? The answer is simple: No one understands the significance of loan fees. It is not the rate that kills you; it is the fees. Consider this, the average homeowner will refinance every four years. They will refinance to receive a lower rate, to consolidate debt, and to avoid interest adjustments or a combination of the three. On average, a homeowner can expect to pay around 3 percent of the loan amount in fees and charges. That means that for a $200,000 loan, a homeowner can expect
to pay around $6,000 every four years to refinance. In many cases, the monthly savings from a lower rate will never outpace the amount of equity lost through loan fees. Remember, all loan rates come from the same places, so in the end you are going to get the same thing from every company with whom you speak. When refinancing, worry more about fees than rates.
Your Credit Score Matters. Now more than ever, your credit score is an important factor in your ability to save money. Over the past year, lenders have placed tighter restrictions on loan programs, limiting the amount of funds available to those with less than excellent credit. Every homeowner should be actively working to maintain the highest credit rating possible. The difference between a 650 and 640 could create an increase of as much as $200 per month for a $200,000 loan. When considering refinancing, limit the use of your credit. Avoid applying for new credit during the 90 days preceding your refinance, and ensure that all accounts are current at the time you apply for your new loan.
Time is of the essence. To get the best interest rate, it is important that you move quickly. Typically, the best rates are available when your loan funds within 10 to 12 days of the time you lock in your interest rate.
“Every homeowner should be actively working to maintain the highest credit rating possible.” I see many clients who want the best possible rate but don’t feel the sense of urgency necessary to meet the deadlines to have the shortest lock period. Just coming prepared to your meeting can eliminate this dilemma. Before you meet with a loan officer, gather the relevant documents.
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Here is a list of the basic information that you should plan on having available: • Two, most recent paystubs, with year-to-date earnings. • Two most recent bank statements (all pages) for cash assets. • Two most recent bank statements (all pages) for cash assets. • Most recent statements from any investment or retirement accounts. • Previous two years’ W-2 forms. • Homeowners’ insurance agent contact information. Whether you have questionable credit, an unusual income or employment situation, or are simply overwhelmed with the process, a Mortgage Broker can eliminate the headaches while finding the best options for your particular circumstances.
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Unlike the loan officer at your local bank or credit union, a Mortgage Broker is not limited to the portfolio of loan programs offered by any one bank or lending institution. Mortgage Brokers tend to work with as many as 100 different banks and lenders, providing an increase in the likelihood that you are getting the best possible loan for your needs. Also, Mortgage Brokers have more flexibility with fees.
No Such Thing as “Good Debt.” The reality is that no debt is good. Regardless of the views of those advisors who counsel homeowners to maintain certain kinds of debt, it is better to have zero debt. Unfortunately, for most of us, this just isn’t an option. While there is no such thing as good debt, some debt is worse than others. When considering a refinance, remember that the interest you pay on your home is tax deductible, the interest you pay on your credit cards is not. With very few exceptions, a mortgage is the least expensive money you can borrow. Therefore, if you are paying higher interest debts, you may benefit from consolidating your debts into your mortgage—and taking advantage of an increased tax deduction. In most cases, it is better to keep student loans and car loans; however in some instances it may be beneficial to include these debts in your mortgage payment. By reviewing your options, you can find the best ways to decrease payments and interest, thereby freeing up cash that can be then used to eliminate your debts and accelerate the payoff of your home.
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