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Published: Thursday, May 31, 2012
View this article at ACA International.
Longtime ACA International member Mathew “Matt” McGrath, IFCCE, MCE, of Ottawa, Ontario, Canada, passed away on May 17, 2012, at age 85.
A World War II veteran, McGrath co-founded the Credit Management and Collection Agency in 1953, which was later incorporated as M. McGrath Canada Limited. He sold the firm to four longtime employees in 2001. Later, McGrath became a member of the Law Society of Upper Canada and worked as a credit consultant.
McGrath was extremely active in ACA and for many years was known for attending more annual conventions than any other member. Between 1966 and 2002, he served a total of 32 years on ACA's Board of Directors and concurrently on 11 different committees.
He became an ACA Certified Instructor in 1969 and was honored with ACA's Continuous Service Award, Paul Bunyan Award, International Paul Bunyan Award, James K. Erickson Continuous Service Award and two Fred Kirschner Instructor Achievement Awards. He also earned both the Fellow and Scholar Degrees.
In 2000, McGrath was elected to ACA's Hall of Fame, recognizing his outstanding dedication and contributions to the credit and collection industry. He was awarded honorary ACA membership in 2006.
McGrath was a city alderman and member of many church and community organizations. He is survived by his wife Jean and their 10 children, along with 20 grandchildren and three great-grandchildren.
Published: Wednesday, May 30, 2012
View this article at ACA International.
On May 29, 2012, the U.S. Supreme Court announced it would hear a case in which a debt collection agency was awarded costs in a Fair Debt Collection Practices Act (FDCPA) lawsuit pursuant to Federal Rule of Civil Procedure 54(d). The question before the Supreme Court is whether a prevailing defendant in an FDCPA case is entitled to costs, regardless of whether the plaintiff brought the suit in bad faith and for the purpose of harassment.
The case, Marx v. General Revenue Corp., No. 11-1175, was originally brought by a consumer who defaulted on her student loan and alleged that a debt collection agency violated the FDCPA by sending a fax to her workplace that requested information about her employment status. The district court dismissed the consumer's claim and concluded the collection agency's fax did not violate the FDPCA because it was not a “communication” as defined by the Act. The district court awarded the collection agency costs pursuant to Federal Rule of Civil Procedure 54(d) and did not find that the consumer's action was not brought in bad faith and for the purpose of harassment. The consumer appealed.
Although Federal Rule of Civil Procedure 54(d) allows a prevailing party to recover costs, the consumer argued that § 813(a)(3) provides that a court may award costs to a successful defendant only if the court finds that the plaintiff brought the action in bad faith and for the purpose of harassment.
The U.S. Court of Appeals for the Tenth Circuit affirmed the district court's decision and held that § 813(a)(3) does not supersede Rule 54(d). The Supreme Court's decision will determine whether a debt collector who prevails in an FDCPA action may recover the costs incurred in defending the action, even when a court does not find that the consumer brought the action in bad faith and for the purpose of harassment. ACA will continue to monitor this appeal and update the membership of new developments.
Published: Thursday, May 24, 2012
View this article at ACA International.
Columbia Ultimate, an ACA International affiliate member based in Vancouver, Wash., recently named Mark Beirdneau as Ajility product manager. In this position, Beirdneau will oversee the direction and development of Ajility, one of Columbia Ultimate's newest collection solutions.
Beirdneau brings substantial expertise to the position, with 20 years of experience in the collection industry, including 10 years in several roles at Columbia Ultimate. Additionally, he worked for United Collection Bureau, eFunds Corporation, National Revenue Corporation and served as chief information officer for Columbia Ultimate's partner company, The Intelitech Group.
“It has been a pleasure working with Mark over the past decade, and I am pleased to have him in his new role overseeing Ajility,” said Columbia Ultimate President and CEO R. Fred Houston. “His extensive agency experience and industry relationships will be an asset in helping us to determine what new enhancements and features our clients who use Ajility will find most useful.”
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Published: Thursday, May 24, 2012
View this article at ACA International.
Existing bank credit card balances as of April 2012 were 28 percent below their peak, according to Equifax's May National Consumer Credit Trends Report. Balances were $531 billion in April 2012 compared to slightly more than $730 billion in January 2009.
Retail card balances have not trended up or down, remaining even with seasonally adjusted pre-recession levels, but the number of retail card accounts fell sharply. Over the 28 months ending December 2010, card accounts fell by 22 percent. They have since grown by 4.7 percent, now reaching 173 million accounts. In April 2012, available credit for retail credit cards (the difference between total credit limits and balances) increased approximately $5 billion after bottoming out in Q4 2011, driven primarily by rising credit limits.
"The combination of increased available credit and more timely payments among card borrowers has led to the recent growth in card lending," said Equifax Chief Economist Amy Crews Cutts. "Consumers are starting to respond to increased credit availability both in cards and other tradelines, a signal of both their financial confidence and improving economic conditions. In turn, this increased consumer credit activity bodes well for U.S. economic growth through the second half of 2012."
Other highlights of the data include:
- Aggregated bank card credit limits have held steady for the past six months at $2.4 trillion, roughly 6.6 percent higher than the low point set in February 2011.
- From April 2010 to April 2012, bank card balance write-off rates declined by more than half (from 13.2 percent to less than 6 percent).
- New bank card issuance rose almost 37 percent in February 2012 relative to the same month a year ago.
- The credit limit on new cards averaged $4784 in February 2012, a 17 percent increase from February 2011 average of $4,008.
- Use (the ratio of balances to credit limits) was slightly more than 22 percent in April 2012, nearly equaling November 2007 lows.
- As of March 2012, roll rates (the rate at which consumers progress from the "current" stage in payments to 30 days past due) have remained below 1 percent since February. This marks the first instance in more than five years roll rates have remained at this level for more than two months.
- Bank credit card charge-off dollar rates (amounts deemed uncollectable by banks) hit 5 percent in April 2012, nearly 58 percent lower than the March 2010 peak of nearly 12 percent.
- Retail card credit limits are stabilizing after falling 15 percent in early 2010 and another 7 percent in mid 2011 (currently at $299 billion).
Published: Thursday, May 24, 2012
View this article at ACA International.
Nonhome finance write-off dollars year-to-date through April have decreased 52 percent, according to Equifax's April National Consumer Credit Trends Report. The write-offs have decreased to $26.2 billion as of April 2012 from $54.1 billion in April 2009. Today's write-offs approach 2006 pre-recession levels of $24.0 billion and continue an improving trend.
Nonhome finance write-off dollars have declined due to both improvements in general repayment patterns and lower numbers of bankruptcies. Bankruptcy dollars have declined at a slower rate, comprising 15.7 percent of write-off dollars in 2009 but 18.5 percent of write-off dollars today. This is due to faster declines in the average dollar size of general delinquencies, relative to the peak of the recession.
Nonhome finance balances declined by 7 percent or $193 billion since October 2008, but the deleveraging trend ended about a year ago, with balances now 1.5 percent higher than in May 2011.
Auto balances are increasing following the trend in rising auto sales, while card balances are declining at a slower rate due to sustained origination increases and payment improvements that mirror pre-recession levels.
Based on current trends, card balances will stop declining and begin increasing during 2012. With the continued weakness in labor markets, demand for additional education is very strong. As a result, student lending balances rose 66 percent to $766 billion in November 2011 (from the pre-recession average of $460 billion) before falling back to $753 billion as of April 2012.
Other highlights from the data include:
- Home finance balances have decreased $1.2 trillion since October 2008, posting a fourth consecutive year of decline.
- Home finance real estate owned dollars (write-offs) for April 2012 have dropped 29 percent from April 2010 to $71.5 billion and is at the lowest level since 2008 ($74.7 billion).
- In April 2012, home equity revolving balances were near $560 billion, down $115 billion from April 2009 and down $43.8 billion from April 2011.
- Foreclosures in process for home equity revolving credit dropped 37 percent from same time a year ago. At just under $1.25 billion, this is the lowest in two years.
- As of April 2012, the number of outstanding auto loans is at 57 million, the highest since January 2010. Balances on these loans have risen from $689 billion in April 2011 to $734 billion in April 2012.
Published: Thursday, May 24, 2012
View this article at ACA International.
The pace of job creation may pick up over the summer months due to an expected increase in seasonal hiring, according to CareerBuilder's annual Summer Job Forecast. Three in 10 (29 percent) U.S. employers plan to hire workers for the summer, up from 21 percent in 2011 and an average of 22 percent over the past four years.
Employers in the following industries are expected to lead seasonal hiring with the following percentage of additional summer workers:
- Manufacturing: 45 percent
- Hospitality: 44 percent
- Retail: 34 percent
- Finance: 31 percent
The possibility of full-time employment makes summer work a good opportunity for recent college graduates, unemployed job seekers and people who have left the workforce altogether. Seventy-one percent of employers hiring this summer said they will be considering some hires for permanent positions. In fact, 39 percent of employers said they are less likely to hire someone who is not interested in working beyond summer.
In addition to the summer availability of retail, hospitality and manufacturing jobs, employers also plan to hire seasonal help in customer service, office support, information technology, research, engineering and sales.
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