Debt Loans – PSP Book http://pspbook.com/ Tue, 22 Jun 2021 06:06:46 +0000 en-US hourly 1 https://wordpress.org/?v=5.7.2 https://pspbook.com/wp-content/uploads/2021/05/default1-150x150.png Debt Loans – PSP Book http://pspbook.com/ 32 32 Several Chinese Banks Restrict Credit to Evergrande Over Debt Risk, Property News & Top Stories https://pspbook.com/several-chinese-banks-restrict-credit-to-evergrande-over-debt-risk-property-news-top-stories/ https://pspbook.com/several-chinese-banks-restrict-credit-to-evergrande-over-debt-risk-property-news-top-stories/#respond Tue, 22 Jun 2021 05:58:42 +0000 https://pspbook.com/several-chinese-banks-restrict-credit-to-evergrande-over-debt-risk-property-news-top-stories/ SHANGHAI (BLOOMBERG) – Several major Chinese banks are restricting credit to the China Evergrande group amid growing concerns over the developer’s financial health, people familiar with the matter say. Three banks with a combined 46 billion yuan (S $ 9.58 billion) credit exposure to Evergrande in June 2020 have decided in recent months not to […]]]>


SHANGHAI (BLOOMBERG) – Several major Chinese banks are restricting credit to the China Evergrande group amid growing concerns over the developer’s financial health, people familiar with the matter say.

Three banks with a combined 46 billion yuan (S $ 9.58 billion) credit exposure to Evergrande in June 2020 have decided in recent months not to renew loans to the company as they fall due this year, the officials said. people, asking not to be identified by discussing private information.

The decisions were made before Evergrande’s bonds began to tumble in late May and were the result of banks’ internal risk assessments, the sources said.

Three other banks allow Evergrande to roll over portions of lines of credit it has already used, but limit the company’s access to any untapped credit from those lines, the people said.

These banks decided not to take a more restrictive stance in part because they feared that a significant reduction in loans to the world’s most indebted developer could destabilize the Chinese financial system before the politically sensitive 100th anniversary of the Communist Party on the 1st. July, people said.

Some Chinese trust companies – Evergrande’s second-largest lenders after banks – have also reassessed their exposure to the company, people familiar with the matter have said.

A company no longer considers the group’s guarantees as sufficient to lend to its subsidiaries, focusing instead on the quality of the guarantees backed by the loans. Another examines whether to issue new products related to Evergrande. Both companies are among the top 10 providers of developer trust loans.

While the metrics alone don’t suggest that Evergrande is at risk of an impending liquidity crunch, they do show that the company faces declining options as it searches for ways to pay off debt.

Evergrande remains heavily reliant on bank financing even after some lenders took preliminary steps to reduce their exposure in the second half of last year.

According to its latest annual report, bank loans and other corporate borrowing, including trusts, accounted for about 81 percent of the developer’s 335.5 billion yuan in interest-bearing debt maturing in 2021.

In response to Bloomberg’s questions on Monday, Evergrande denied that banks were restricting its access to finance and said its business relationships with all banks and financial institutions were normal, without further details.

Major Evergrande creditors, including China Minsheng Banking, China Citic Bank, Industrial & Commercial Bank of China, China Construction Bank, China Zheshang Bank and Bank of China, did not immediately respond to requests for comment.

Billionaire real estate giant Hui Ka Yan in March unveiled plans to halve its debt over the next two years and also pledged to meet at least one of the regulatory borrowing limits. China for developers, known as the “three red lines,” by the end of this month.

The company increased home sales – sometimes with big discounts – and offloaded other assets to free up money.

On Monday, June 21, Evergrande announced that it would sell shares in a Hangzhou unit to a company controlled by Wang Zhongming, a repeat investor in Mr. Hui’s operations.

It’s the billionaire’s latest move to tap into the financial support of friends with deep pockets, who have repeatedly stepped up cash injections during times of stress.

Evergrande stock jumped 9% on the news, rebounding from a four-year low and hitting short sellers who had piled into bearish bets in recent weeks.

The company’s stocks and bonds had fallen since late May after missed payments at Evergrande subsidiaries and a report that regulators were probing the developer’s ties to Shengjing Bank, a lender in which it has a stake.

Evergrande said it will arrange payment for overdue commercial papers from its subsidiaries and that its transactions with Shengjing Bank comply with Chinese law.

Undesirable rated bonds issued by Evergrande that mature in June 2025 fell 0.5 cents on the dollar to around 73 cents on Tuesday, according to data compiled by Bloomberg. The stock lost 1.5% at 11:06 am in Hong Kong.

By refusing to roll over loans to Evergrande, some banks are taking an even more cautious approach than required by the “three red lines” framework.

While Evergrande is barred from taking on additional debt after becoming one of four big real estate companies to cross the three red lines late last year, the developer can roll over existing loans if banks agree. to do.

Trust companies, which invest the money of wealthy Chinese savers, have already significantly reduced their exposure to Evergrande, according to data compiled by Use Trust. The developer has only raised 9.3 billion yuan in fiat issues so far this year, down 85% from the first six months of 2020. This financing accounted for 41% of the company’s total borrowings. at the end of 2019.

Evergrande has long been a source of anguish for Chinese regulators and creditors.

In 2018, the central bank named the developer as well as HNA Group, Tomorrow Holding and Fosun International as companies that could pose systemic risks to the country’s financial system.

Chinese regulators recently asked Evergrande’s major creditors to conduct a new round of stress tests on their exposure to the company, people familiar with the matter said earlier this month.

Evergrande’s complex web of liabilities – including bank loans, bonds, and homebuyers’ down payments – swelled to 1.95 trillion yuan at the end of last year, of which about 77% was owed in every 12 months, according to its annual report.

With more than US $ 20 billion (S $ 26.85 billion) in offshore bonds, Evergrande is, alongside China Huarong Asset Management, one of the most prolific Chinese issuers of dollar debt.

Like Huarong, he is seen as a litmus test of the government’s willingness to support distressed borrowers as policymakers attempt to balance sometimes competing goals of maintaining financial stability and reducing moral hazard.



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Firms in financial difficulty will be offered interest-free loans for layoff costs https://pspbook.com/firms-in-financial-difficulty-will-be-offered-interest-free-loans-for-layoff-costs/ https://pspbook.com/firms-in-financial-difficulty-will-be-offered-interest-free-loans-for-layoff-costs/#respond Mon, 21 Jun 2021 00:00:26 +0000 https://pspbook.com/firms-in-financial-difficulty-will-be-offered-interest-free-loans-for-layoff-costs/ The government will implement a new program to offer interest-free loans to companies that are having difficulty meeting severance pay for their staff as a result of the pandemic. The Department of Enterprise, Trade and Employment said over the weekend that it was working on a new deal under which those debts would be “in […]]]>


The government will implement a new program to offer interest-free loans to companies that are having difficulty meeting severance pay for their staff as a result of the pandemic.

The Department of Enterprise, Trade and Employment said over the weekend that it was working on a new deal under which those debts would be “in storage” for a specified period.

Taoiseach Micheál Martin told the annual industrial relations press conference last Friday that the government would lift a temporary suspension in September that was put in place during the pandemic over the rights of workers who had been made redundant to trigger demands dismissal.

The Taoiseach described the decision to introduce the suspension of severance claims during the Covid crisis as “a proportionate measure to mitigate a risk to businesses and of course to jobs.”

Mr. Martin said that after the current suspension is lifted, the government will “ensure that financially troubled businesses are supported by a deferred payment agreement while ensuring that employees receive their rights.”

Tánaiste and Enterprise and Employment Minister Leo Varadkar had raised the issue of the government providing interest-free loans to employers who would have difficulty paying severance pay in a letter to businesses earlier this month.

The ministry gave more details on the planned new regime after Mr. Martin’s speech on Friday.

He stated that under the existing provisions of the Severance Pay Act 1967, the state may finance statutory severance pay from the Social Insurance Fund on behalf of an employer in situations where the The employer can provide proof of inability to pay due to financial hardship or insolvency.

He stated that in such situations a debt was incurred and the employer was required to repay it. “The Ministry of Social Protection will seek to collect the debt directly from the employer and each case is assessed on its own merits. A mutually agreed-upon repayment plan can be put in place, including installment repayments to minimize financial hardship.

Storage

The Ministry of Enterprise, Trade and Employment said that to coincide with the lifting of the emergency suspension of the right to seek dismissal and in recognition of the challenges some companies would face in meeting the costs involved , “It is proposed that, for a limited period, the existing practice will be restructured to introduce some form of ‘storage’ of the termination debt related to Covid.

“The details of this proposal are currently being worked out, but the intention is that, subject to eligibility criteria, including verification of inability to pay, the termination debt be formally deferred or ‘parked. »For a defined period, without interest or penalty. .

“The Ministries of Enterprise, Trade and Employment and Social Protection are working together to finalize these provisions and introduce legislative changes in the coming months. ”



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Student loan repayments will resume soon. Here’s what you need to do now https://pspbook.com/student-loan-repayments-will-resume-soon-heres-what-you-need-to-do-now/ https://pspbook.com/student-loan-repayments-will-resume-soon-heres-what-you-need-to-do-now/#respond Sat, 19 Jun 2021 14:10:57 +0000 https://pspbook.com/student-loan-repayments-will-resume-soon-heres-what-you-need-to-do-now/ The other day, I did something that I hadn’t done in over a year: I logged into my student loan account. Or at least that’s what I tried to do. Turns out I forgot my password and couldn’t enter. Instead of following the steps to change it, I closed the browser and went back into […]]]>


The other day, I did something that I hadn’t done in over a year: I logged into my student loan account. Or at least that’s what I tried to do. Turns out I forgot my password and couldn’t enter. Instead of following the steps to change it, I closed the browser and went back into denial.

This fall, borrowers will once again have to make room in their lives and budgets for monthly student loan payments. It’s a good race. The US Department of Education first gave borrowers the option to suspend their bills with no accrued interest in March 2020. (Most federal student loan borrowers have accepted this offer.)

Many borrowers have grown accustomed to living without a hefty monthly student loan bill and are unlikely to look forward to the hiatus over in October.

“Student loan payments have been lost in sight and out of mind,” said Elaine Griffin Rubin, senior contributor and communications specialist at Edvisors.

To alleviate some of your anxiety (and mine!), I spoke to experts about what you need to know about change, and how best to prepare for it.

When will the invoices be due again?

In October. Your exact due date will vary depending on when in the month you started paying off your student loans.

There is still a chance that borrowers will have more time: recently Education Secretary Miguel Cardona said that an extension was under consideration.

“It will probably depend on the state of the economic recovery by then,” said higher education expert Mark Kantrowitz. “I doubt they’ll extend it beyond the end of the year.”

Don’t count on more time, said Betsy Mayotte, president of The Institute of Student Loan Advisors, a nonprofit organization.

“Although it remains a possibility, it is not guaranteed,” she said. “It’s best to prepare now – the student loan service call centers will get busier as October approaches.”

What should I do now?

Over the next three months, borrowers should make sure their student loan officer has their current contact information, Kantrowitz said. If you have moved, for example, this may not be the case.

If you were signed up for automatic payments and your banking information has changed, you will also need to notify your server.

Putting money aside for resuming payments can also make the transition less painful, experts say.

What if I am worried that I will not be able to start making payments again?

How to choose the right payment plan?

This can make income-oriented repayment plans more appealing, as they often come with lower monthly bills and borrowers will likely no longer be faced with a massive tax bill at the end of their 20 or 25 years of payments.

But if you can afford it, the standard repayment plan is only for 10 years.

To calculate your monthly bill amount under different plans, use one of the calculators from Studentaid.gov or Freestudentloanadvice.org, Mayotte said.

If you decide to change your repayment plan, Mayotte recommends that you submit this request to your manager by the beginning of September.

“I am very concerned that there are big service delays,” Mayotte said.

Is student loan cancellation still possible?

Even if government officials conclude that Biden does not have such authority, there could still be hope.

While Democrats may struggle to pass a bill forgiving student debt in Congress, given their very slim majority, they could turn such a bill into law through the budget reconciliation process in the fall. This avenue would not require the support of Republicans.

Should I be thinking about refinancing my student loans?

Borrowers think refinancing their federal student loans into private loans at a lower interest rate might want to wait, Kantrowitz said. For one thing, the interest rate on most federal student loans is 0% for at least three months.

Plus, “they’ll feel stupid if they only refinance for the federal government to announce the loan cancellation,” Kantrowitz said.





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Student Loan Debt: A Bottomless Pit | National exam https://pspbook.com/student-loan-debt-a-bottomless-pit-national-exam/ https://pspbook.com/student-loan-debt-a-bottomless-pit-national-exam/#respond Fri, 18 Jun 2021 23:17:56 +0000 https://pspbook.com/student-loan-debt-a-bottomless-pit-national-exam/ (zimmytws / Getty Images) To anyone’s surprise, Biden & Co. decided to write off $ 500 million in loan debt for students who had enrolled in now-defunct ITT Technical Institute schools. They have all been “misled” by ITT’s statements about their likely earnings. Without a doubt, but many nonprofit colleges make similar statements to attract […]]]>


(zimmytws / Getty Images)

To anyone’s surprise, Biden & Co. decided to write off $ 500 million in loan debt for students who had enrolled in now-defunct ITT Technical Institute schools. They have all been “misled” by ITT’s statements about their likely earnings. Without a doubt, but many nonprofit colleges make similar statements to attract students.

Forgiving student debt is good policy. Democrats look sympathetic, and many students will be thankful they don’t have to pay back their loans. As for taxpayers, well, a tiny increase in the federal government’s budget deficit will not be noticed. What has not happened and certainly will not happen is a move to fix this problem.

ReasonMike Riggs associate editor has a good article on this point.

Riggs writes: “While inducing low-income people to borrow money they cannot repay for an education they cannot use is probably the worst consequence of federal grants to higher education, we also now know that easy loans have inflated the cost of ‘good colleges and universities, which compete by increasing costs in order to absorb grants that they can invest in prestige points rather than in preparation for the workforce: nicer buildings, more sophisticated food services, more after-school programs, and an abundance of non-academic staff for participants, especially those at nonprofit liberal arts colleges, to progressives rarely criticize for their ever increasing sticker prices, feeling like they are staying at a resort with the occasional class.

He is right. Federal student aid is at the origin of the prodigious expansion of higher education and the vast inflation of its cost. There is no constitutional mandate for federal largesse, but, unfortunately, the Constitution’s limits on federal spending were swept away a long time ago. We will continue to waste resources on unnecessary university degrees at enormous prices as long as we continue to subsidize them.

Riggs continues, “There are so many other things we should be doing differently. Many for-profit programs probably wouldn’t exist without professional licensing requirements, such as those for the [cosmetology] industry; other for-profit programs, such as those that train students for administrative roles in medicine, are a result of the U.S. healthcare system’s metastatic need for paper pushers capable of handling labyrinthine billing operations and complying with regulations. “

Indeed. Let us mitigate the inflated demand for higher credentials. It would help at the margin. Ultimately, however, we must get to the root of the problem and get the federal government out of the business of university finance.

George Leef is the Editorial Content Director of the James G. Martin Center for Academic Renewal.



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US high-yield debt rests on increasingly fragile foundations https://pspbook.com/us-high-yield-debt-rests-on-increasingly-fragile-foundations/ https://pspbook.com/us-high-yield-debt-rests-on-increasingly-fragile-foundations/#respond Thu, 17 Jun 2021 20:56:30 +0000 https://pspbook.com/us-high-yield-debt-rests-on-increasingly-fragile-foundations/ June 19, 2021 IBUSINESS INVESTORS the issue of high yield or “junk” debt has experienced a relatively mild pandemic. Usually, these heavily indebted borrowers are stung by economic hardship. During the global financial crisis more than a decade ago, about a seventh of these American companies defaulted on their debt in one year. Yet, according […]]]>


IBUSINESS INVESTORS the issue of high yield or “junk” debt has experienced a relatively mild pandemic. Usually, these heavily indebted borrowers are stung by economic hardship. During the global financial crisis more than a decade ago, about a seventh of these American companies defaulted on their debt in one year. Yet, according to Moody’s, a rating agency, less than 9% of them defaulted until August 2020, and the rate has been dropping steadily since. By the end of 2021, a meteoric recovery is expected to drop it below its long-run average of 4.7%

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However, it may be too early for high yield investors to congratulate themselves. The low default rate masks a much riskier market than it was before Covid-19. Take high yield bonds, whose market is worth $ 1.7 billion. Issuers have record levels of leverage relative to their earnings, increasing their vulnerability to higher interest rates or a disappointing economic recovery. Cash-strapped borrowers take advantage of less stringent loan contracts to abuse their creditors. And for businesses that default, loans that were previously associated with high levels of protection and security are proving to offer lenders anything but.

Start with the amount of debt. Last year, $ 435 billion in junk bonds were issued. As a result, the average high yield borrower now has debt equivalent to an unprecedented six and a half times their gross operating profit of the past 12 months, or EBITDA (see table). Oleg Melentyev, of Bank of America, warns that the low default rate may have simply delayed the pain. “Companies carry the baggage of capital structures that should have been restructured, but were not,” he says. “We will pay the price for high defaults later in the cycle.”

Meanwhile, borrowers with liquidity issues get the better of their lenders. Moody’s Evan Friedman and Enam Hoque describe how investors’ thirst for yield over more than a decade of low interest rates eased loan agreements. Maintenance covenants, or restrictive covenants that allow lenders to take the reins if the borrower’s financial situation deteriorates, are now mostly absent. Worse yet, covenants, which limit the ability of borrowers to issue new debt and pay dividends, have lost their strength over time. “When you go into covenants and reduce your insurance liabilities, you give the borrower all the flexibility to run the show,” says Friedman.

The run some of them are. Serta Simmons Bedding, a mattress maker, gained notoriety last year for raising $ 200 million by swapping debts with some lenders for new ones with a higher level of security. Without their consent, non-participating creditors were exposed to higher losses in the event of default. A lawsuit to unwind the transaction has been dismissed by the courts, paving the way for similar settlements in the future.

What happens to loans that go wrong? Lenders are used to the idea that so-called “senior” debt gives them priority over the borrower’s assets in the event of bankruptcy. But Moody’s analysis of defaults during the pandemic shows senior lenders are losing nearly twice as much of their principal as before: the average collection rate in 2020 was 55%, compared to a long average. 77% term.

This is the result of the deterioration of debt structures, another trend that has lasted for a decade. In the past, senior loans had high recovery rates because a significant portion of the remaining debt was subordinated, i.e. behind them in the default queue. But in 2020, more than a third of senior loans had no underlying junior debt to absorb losses. If all of a borrower’s debt has a primary claim on its assets, the value of that claim is lower and lenders lose more protection.

None of this necessarily means the US high yield market is heading for disaster. Interest rates remain low and a rapid recovery should restore profits. But a nasty surprise on either front could quickly cause problems. The default cycle of covid-19 may still have a sting in the tail.

This article appeared in the Finance and Economics section of the print edition under the title “The Scrap Heap”



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How Student Loans Can Help You Build A Good Credit Score https://pspbook.com/how-student-loans-can-help-you-build-a-good-credit-score/ https://pspbook.com/how-student-loans-can-help-you-build-a-good-credit-score/#respond Wed, 16 Jun 2021 20:18:44 +0000 https://pspbook.com/how-student-loans-can-help-you-build-a-good-credit-score/ item Here’s how borrowing for school can help improve your credit score. (iStock) Student loans can present financial challenges when working to pay off your student loan debt and hopefully avoid late payments or student loan default. But while it may take time, money, and effort to effectively manage your student loans, there are some […]]]>


Here’s how borrowing for school can help improve your credit score. (iStock)

Student loans can present financial challenges when working to pay off your student loan debt and hopefully avoid late payments or student loan default. But while it may take time, money, and effort to effectively manage your student loans, there are some benefits to borrowing for school.

The most obvious benefit of student loans is that they help cover the cost of obtaining a degree. But paying off your student loan can also be beneficial for another important reason. Student loan debt can affect your credit in many ways and can help you build credit as well.

For many young people, student loans are the first debt they incur. Paying them responsibly can help you build your credit history, improve your financial health, and hopefully achieve a favorable FICO score that opens all kinds of doors for you when it comes to personal finance.

HOW CAN I GET HELP WITH STUDENT LOANS?

Of course, this only works if you know how much you are borrowing and making all of your payments on time. You can use a online tool like Credible to display a rate table that compares the rates of several lenders at the same time to find the right loans for you and a online student loan refinance calculator to better understand the loan repayment costs.

What factors affect your credit score?

Your credit score is determined by five key factors:

  • Your payment history on time
  • The average age of your credit accounts
  • The credit mix you have
  • The percentage of your available credit used
  • The number of recent new credit requests

While each of these different criteria is part of the credit scoring formula leading to good credit, fair credit, or bad credit, payment history is the most important consideration of all. Of course, you can only begin to develop a positive payment history once you actually owe the creditors money and thus avoid missing payments.

Student loans are often the first type of debt available to you, so they’re your first chance to start building a positive payment history. However, you need to be careful not to apply too often to different student loan lenders, as too many recent applications could hurt your credit.

3 WAYS TO REDUCE YOUR STUDENT LOAN DEBT

The good news is that you can use an online tool like Credible to compare student loan refinance rates from multiple lenders at once without affecting your credit score.

How Your Credit Score Can Improve With Student Loans

Student loans positively affect credit scores by providing the ability to borrow and start building a credit history.

Often, creditors do not issue a loan or credit card to student borrowers until they have demonstrated that they can handle debt responsibly. It is therefore difficult to borrow for the very first time. But student loans can be easier to obtain than many other types of debt, so they can be the start of improving your credit history that gets you a good score.

HOW CAN BORROWERS RECOVER FROM STUDENT LOAN DEFAULT?

You may be eligible for federal student loans even if you have no credit history. Although the eligibility requirements are stricter for private student loans, many lenders allow you to get approval based on your future income and / or with the help of a co-signer. Once you have been approved, your loan and payment statement will appear on your credit report and will be used to determine your score.

An online tool like Credible can be handy for compare the student loan refinancing rates of several lenders without affecting your credit score.

Can Refinancing a Student Loan Help Your Credit Score?

Once you’ve taken out student loans, the key to starting to build credit with them is to make sure you always make your payments on time. Refinancing a student loan can often make things easier.

Refinancing is getting a new loan and using the new debt proceeds to pay off your old student loans in full. Refinancing can sometimes lower your interest rate and can also change the loan repayment schedule.

Often, refinancing allows you to pay off debt faster or lower your monthly payment, or both. If you can activate on-time refinancing payments or pay off your debt balance faster, it can improve your credit score.

6 BEST WAYS TO MANAGE YOUR STUDENT LOANS

You generally want to refinance only private loans, not federal loans, because you don’t want to forgo the benefits of federal loans. You’ll also need to make sure you find a new, affordable loan with a monthly payment that fits your budget. Use a online tool like Credible to get prequalified student loan refinance rates without affecting your credit score.

Have a finance-related question, but don’t know who to ask? Email the Credible Money Expert at moneyexpert@credible.com and your question could be answered by Credible in our Money Expert column.



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US defends debt relief for minority farmers despite legal battle https://pspbook.com/us-defends-debt-relief-for-minority-farmers-despite-legal-battle/ https://pspbook.com/us-defends-debt-relief-for-minority-farmers-despite-legal-battle/#respond Tue, 15 Jun 2021 20:06:00 +0000 https://pspbook.com/us-defends-debt-relief-for-minority-farmers-despite-legal-battle/ CHICAGO (Reuters) – The United States Department of Agriculture (USDA) defends efforts to wipe out government-guaranteed loans to farmers facing decades of discrimination, despite a temporary restraining order on the relief plan debt issued by a US district court last week. FILE PHOTO: Farm equipment is seen at Foster Farm in Sagaponack, Long Island in […]]]>


CHICAGO (Reuters) – The United States Department of Agriculture (USDA) defends efforts to wipe out government-guaranteed loans to farmers facing decades of discrimination, despite a temporary restraining order on the relief plan debt issued by a US district court last week.

FILE PHOTO: Farm equipment is seen at Foster Farm in Sagaponack, Long Island in New York, the United States July 8, 2019. Photo taken July 8, 2019. REUTERS / Lindsay Morris

A USDA spokesperson said the agency would be ready to process payments of estimated $ 4 billion in debt relief for 17,000 black, native, Hispanic and Asian farmers once the legal battles are resolved. He planned to start payments in June.

“The USDA will continue to vigorously defend its ability to implement this act of Congress and provide debt relief to socially disadvantaged borrowers,” a USDA spokesperson said Tuesday.

The spokesperson said the government could not appeal the restraining order, which stays payments until the U.S. District Court for the Eastern District of Wisconsin rules more broadly on a lawsuit aimed at determine whether or not the debt relief program discriminates against non-minority farmers.

For decades USDA employees and programs have discriminated against socially disadvantaged farmers by denying loans and delaying payments, resulting in a loss of $ 120 billion in farmland value since 1920, according to an analysis of the ‘Tufts University in 2018. The Biden administration’s loan cancellation program aims to address these systemic inequalities.

The lawsuit, filed by the Wisconsin Institute for Law and Liberty on behalf of 12 white farmers, seeks to end debt relief by claiming it excludes farmers on the basis of race. This is one of many lawsuits filed after the USDA detailed plans to implement the minority farmer debt relief provision, which is part of the American Rescue Plan Act that the Congress passed in March.

Judge William C. Griesbach, US District Judge for the Eastern District of Wisconsin, granted the temporary restraining order on June 10.

“The obvious response to a government agency that claims it continues to discriminate against farmers on the basis of their race or national origin is to order it to stop,” Griesbach said in the ruling.

Some black farmers are not surprised that the relief has stalled, after seeing the previous government’s anti-discrimination efforts underachieve.

“Talking is cheap. I can’t buy grain with it. I want to know when you’re going to help some farmers,” said Lloyd Wright, a farmer from Virginia who was director of the USDA’s Civil Rights Office. in the late 1990s and early 2000s.

Wright said black farmers have been promised federal discrimination relief in the past, only to be disappointed on several occasions. He suggests that eligible farmers continue to pay on the loans, so they don’t end up late if the program is permanently blocked.

Reporting by Christopher Walljasper; Editing by Marguerita Choy



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China Cross-Border Loan and Security FAQs | Dentons https://pspbook.com/china-cross-border-loan-and-security-faqs-dentons/ https://pspbook.com/china-cross-border-loan-and-security-faqs-dentons/#respond Mon, 14 Jun 2021 22:17:59 +0000 https://pspbook.com/china-cross-border-loan-and-security-faqs-dentons/ This article introduces some frequently asked questions from our clients regarding lending and cross-border security in the People’s Republic of China (the “PRC”, and for the purposes of this article only, we are not referring to Hong Kong Special Administrative Region of China. Macao as well as Taiwan, mentioning the PRC). 1. Is a license […]]]>


This article introduces some frequently asked questions from our clients regarding lending and cross-border security in the People’s Republic of China (the “PRC”, and for the purposes of this article only, we are not referring to Hong Kong Special Administrative Region of China. Macao as well as Taiwan, mentioning the PRC).

1. Is a license or regulatory approval required for foreign lenders to lend in the PRC or to take as collateral assets located in the PRC?

No license or regulatory approval is required for foreign lenders to lend money to PRC entities or to secure collateral on assets located in the PRC.

2. What are the regulatory requirements on foreign borrowing / debt?

(1) Limits on external debt

The foreign debt quota system established under the laws of the PRC requires that the risk-weighted balance of all foreign loans borrowed by a borrower from the PRC (other than a bank) not exceed its quota of external debt, which must be calculated according to the following formula:

PRC borrower’s net assets × cross-border finance leverage (currently set at 2) × macro-prudential adjustment parameters (currently set at 1.25)

If the PRC borrower is a foreign owned company (“EIA”), it can opt for the foreign debt quota system or adopt the old regime under which it is allowed to borrow foreign loans up to an amount equal to the difference between its total investment amount and its share capital. The basis for calculating the external debt limit, once determined by the FIE, will remain consistent and will be deposited with the local exchange administration (“SAFE”). The legal requirements relating to the correlation between the total amount of the investment and the share capital of an FIE are listed in the table below:

Total amount of investment Share capital required (as a percentage of total investment)
Less than $ 3 million 70%
US $ 3 million – $ 10 million 50% (minimum US $ 2.1 million if the total investment amount is less than US $ 4.2 million)
$ 10 million – $ 30 million 40% (minimum US $ 5 million if the total investment amount is less than US $ 12.5 million)
Above $ 30 million 1/3 (minimum US $ 12 million if the total investment amount is less than US $ 36 million)

(2) Registration of foreign debt

The borrower from the PRC must apply for registration with SAFE at least three working days before the first drawdown of the foreign loan. Without the registration of foreign debt, no loan can be drawn or repaid by the borrower from the PRC. If any of the terms, amount, creditor (s) or other material conditions of the loan agreement are changed, the borrower of the PRC must update the record accordingly. When the foreign loans are fully repaid, the PRC borrower cancels the registration of the foreign debt with SAFE.

(3) NDRC filing

If the term of the foreign loans is one year or more, the borrower from the PRC must also file the foreign loan with the National Development and Reform Commission (“NDRC”). It should be noted that NDRC filing is also required when the borrower is an offshore entity controlled by a PRC entity.

3. What are the formalities for setting up and perfecting collateral on the shares of a PRC company?

(1) Constitution and registration of the pledge of shares

To create a pledge of shares, (i) a pledge of shares must be signed by the pledge grantor and the pledgee (and usually the PRC company in which the shares are pledged as it is to assist in the collateralization. registration of the pledge of shares), and (ii) the pledge of shares must be filed and registered with (A) the local company registration authority jointly by the pledge grantor and the pledgee or by an agent (a representative) appointed jointly by the pledge settlor and the pledgee, if the PRC company in which the shares are pledged is a limited liability company, or (B) the securities custodian and the clearing institution (with exceptions), if this PRC company is a limited liability company.

Lenders of a syndicate can appoint a security officer to hold the pledge of shares on behalf of the syndicate and assert the rights of the syndicate under the facility documents, and in this case, the security agent must be registered as a pledgee. The contract of pledge of shares can be executed by exchange of signature pages by the parties. No physical delivery of the request documents by the pledgee and / or the pledge grantor is required if an agent is jointly appointed by them to submit the request for registration of the pledge of shares.

(2) Cross-border security registration

Two types of cross-border securities must be registered with SAFE, one is the national title for foreign loans (“NBWD”,) and the other is the foreign title for domestic loans (“WBND”, 外 保 内 贷) . NBWD means the guarantee provided by a national entity located in the PRC in favor of a foreign entity located outside the PRC to secure repayment by a borrower located outside the PRC, and WBND refers to the guarantee provided by an entity foreign bank located outside the PRC in favor of a PRC entity to secure repayment by a borrower located in the PRC. If the share pledge is made by a foreign shareholder of a FIE in favor of a foreign pledgee to secure repayment by a foreign borrower, no cross-border collateral registration is required for such a pledge of shares. However, if the pledge of shares is made by a PRC shareholder of a PRC company in favor of a foreign pledgee to secure repayment by a foreign borrower, the cross-border registration of the securities will take place.

(3) Realization of the pledge of shares

In the event of default by the borrower and the pledge grantor under the facility documents, the pledge grantor cannot unilaterally sell or transfer the pledged shares to himself or to a third party and must apply to the court for the execution of the pledge of shares. If the pledged shares were to be transferred to a foreign entity, the foreign investment requirements under the laws of the PRC must be met.

4. Are there any security registration requirements for providing a warranty?

If a warranty constitutes NBWD or WBND, the warranty must be registered with SAFE. SAFE would take a prudent approach to review the application for registration of cross-border securities and assess the rationality and authenticity of the creation of the collateral as well as the feasibility of the enforceability of that collateral and payment by the PRC entity since the RPC (particularly in the case of NBWD) to determine whether such a warranty could be registered. Without the completion of such a cross-border security registration, no cross-border money flow could be made to or from the PRC.

5. Is the constitution of a pledge of receivables in favor of a foreign pledgee legally possible and what formalities must be followed?

The constitution of a pledge of receivables in favor of a foreign pledgee is legally possible. In order for the pledge to become effective, (i) a pledge agreement must be signed by the pledgee and the pledgee, and (ii) the pledge must be registered with the Credit Reference Center of the People’s Bank of China.

In practice, it is important for the pledgee (a) to exercise due diligence on the underlying claims on which the pledge would be made in order to ensure ownership, authenticity, amount and timeframe. payment of these debts; (b) enter into a tripartite receivables confirmation letter with the seller (the pledge settlor) and the buyer (the debtor of the receivables) to ensure that the buyer acknowledges the pledge of the receivables and agrees to pay on the designated escrow account opened by the pledge with a bank in the PRC; and (c) enter into an escrow agreement with the pledge grantor and a bank in the PRC (as escrow agent), under which the pledge grantor will open an escrow account to receive the claims of the buyers and no outgoing transfers. will not be carried out without instruction or approval from the pledgee. The escrow account must be opened with a bank in the PRC due to foreign exchange regulations.



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Payday loans are for short term needs https://pspbook.com/payday-loans-are-for-short-term-needs/ https://pspbook.com/payday-loans-are-for-short-term-needs/#respond Sun, 13 Jun 2021 18:12:45 +0000 https://pspbook.com/payday-loans-are-for-short-term-needs/ Share Tweeter Share Share E-mail Payday loans can seem like a lifeline when you need quick cash, but the high costs and short repayment terms can trap you in a cycle of debt. While there is no proper definition of a payday loan, it is usually a short term loan for a modest sum, usually […]]]>


Payday loans can seem like a lifeline when you need quick cash, but the high costs and short repayment terms can trap you in a cycle of debt.

While there is no proper definition of a payday loan, it is usually a short term loan for a modest sum, usually $ 500 or less, payable with the charges on your next check. payroll.

Although payday loans are advertised to narrow the gap between paychecks or help with unforeseen needs, the Consumer Financial Protection Bureau warns that they can become “debt traps.”

Because many borrowers cannot afford the loan plus the fees, they are forced to pay even additional fees to avoid paying the debt. So, they keep “renewing” or renewing their debt until they end up paying more in fees than they originally borrowed.

How do payday loans work?

Payday loans are known by various names, including cash advance loans, deferred deposit loans, check advance loans, and online payday loans, but they all work the same.

To get a payday loan, you may need to write an uncashed check for the full amount, including fees, to the lender. You can also allow the lender to automatically debit your checking account. The lender will usually give you money after that.

The loan is usually due on your next payday, which is usually in two to four weeks. The lender can redeem your check or digitally deduct your bank account if you don’t pay off the loan plus the financing fee on the due date.

Many states that allow this form of loan place a limit on the amount of money borrowed and the costs that go with it. Depending on the state, businesses may be allowed to charge between $ 10 and $ 30 for every $ 100 loaned.

Why Do People Take Payday Loans?

Payday loans are a perfect choice for people with bad credit. This is because the borrower does not have to worry about their credit being insufficient or nonexistent when applying for a loan.

Another potential audience is people with little or no savings. This highlights the huge potential of the payday loan market and explains why they are so prevalent. Payday lenders have a configured market because credit problems and lack of funds usually go hand in hand.

While many people can get by with their monthly expenses, an emergency requires the use of the money just once.

What Are the Dangers of Payday Loans?

While payday loans can provide much needed cash, you should be aware of the risks.

  1. High annual percentage rates

Consider a $ 500 two-week loan with costs of $ 15 for every $ 100 borrowed, or an annual percentage rate of nearly 400%, according to the CFPB.

  1. Short term

A payday loan (https://www.paydaylv.com) generally must be repaid within 2 to 4 weeks of the initial loan. Since policies vary from state to state, check your state’s laws.

  1. Additional charges

If you do not pay off the loan on time, you may be charged additional fees on top of the original loan fees. Plus, if you renew your loan or borrow again, these fees start to add up. According to the Consumer Financial Protection Bureau, about a quarter of original payday loans are re-borrowed nine or more times.

Additional charges may include the following:

  • If you do not have enough money in the account when creditors attempt to cash your check or digitally withdraw from your account, you will be charged insufficient funds fees.
  • If you do not repay on time, you will be charged late fees or repayment fees from the lender.
  • The rolling charge is on top of the original loan and the first cost to extend the closing date of your loan.
  1. Will not create credit

People with bad credit may not be able to get loans on reasonable terms. On the other hand, payday lenders rarely register your credit report with the credit bureaus, so the loan will not help you develop your credit.

Alternatives to payday loans

  1. Alternative payday loans

You may be able to get private loans at low interest rates if you belong to or can join a financial institution. For example, members of federal banking institutions can obtain replacement payday loans for amounts ranging from $ 200 to $ 1,000. These typically have six months or less, an application fee of $ 20, and APRs of no more than 28%.

  1. Paycheque advance

In some places, your employer is allowed to advance your payment without charging you a fee. However, it may depend on your company’s decision, so talk to your boss or a human resources representative about your alternatives.

You can also use smartphone apps, which will send you money between paychecks if you meet specific criteria.

  1. Debt settlement

A debt settlement can impact your credit while helping you settle your debt and get a fresh start.

  1. Personal loans

Personal loans can have high interest rates, but if you are in need of a loan and are not eligible for cheaper rates, it is essential to shop around. You might qualify for a bit higher rate and longer terms than the conventional payday lender offers, but you won’t know unless you look around.

Look for a lender who responds to major credit bureaus when applying for a loan. A good reputation for making loan payments on time will help you build credit and ultimately qualify for lower loan rates.

  1. Credit counseling

In the long run, you can work on fixing the underlying financial issues that keep you coming back to the payday lending counters. Consider credit counseling, which can help you budget and open a deposit account.

Conclusion

It is a wise practice to research and evaluate funding opportunities and think about long-term financial improvements that might help. You can start by establishing a budget and a debt repayment strategy.

Payday loans are acceptable, but they should be accepted with caution and repaid promptly due to the high interest rates they charge.










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Alexandria Ocasio-Cortez calls for executive action on student loans https://pspbook.com/alexandria-ocasio-cortez-calls-for-executive-action-on-student-loans/ https://pspbook.com/alexandria-ocasio-cortez-calls-for-executive-action-on-student-loans/#respond Fri, 11 Jun 2021 19:10:54 +0000 https://pspbook.com/alexandria-ocasio-cortez-calls-for-executive-action-on-student-loans/ (Lars Niki / Getty Images) Congresswoman Alexandria Ocasio-Cortez called on Joe Biden to keep his campaign pledge to tackle the $ 1.57 billion in outstanding student debt in the United States. Although he campaigned on the proposal to write off $ 10,000 in student debt per year, up to $ 50,000 per adult, Mr. Biden […]]]>


(Lars Niki / Getty Images)

Congresswoman Alexandria Ocasio-Cortez called on Joe Biden to keep his campaign pledge to tackle the $ 1.57 billion in outstanding student debt in the United States.

Although he campaigned on the proposal to write off $ 10,000 in student debt per year, up to $ 50,000 per adult, Mr. Biden not only broke that promise, but he also actively gave up. to his support.

Lawmakers pushed him to widely write off $ 50,000 in student debt to help Americans whose debt payments can’t keep up with accrued interest, leaving them unable to buy homes, cars, and in some cases, get married or consider having children.

Now, rather than using executive action to forgive the $ 10,000 Mr. Biden said he would support, he instead insisted that the bill be developed and passed by Congress, which more or less guarantees that it will never see the light of day.

The cancellation of student debt was not included in any of Mr. Biden’s major spending proposals or in his federal budget proposal.

Many Democrats have called on Mr Biden to use his executive powers to write off some of the debt, including Ms Ocasio-Cortez.

“During the Obama administration, people thought we would have a 60 Dem majority for a while. It lasted 4 months,” she wrote on Twitter. “Democrats are burning up precious time and impacting negotiations with the GOP which won’t even vote for a Jan. 6 commission. McConnell’s plan is to run out of time. It’s a turmoil. We need to move now. “

Ms. Ocasio-Cortez is not wrong; Senate Minority Leader Mitch McConnell said he was “100%” determined “to prevent” Biden’s administration from achieving its goals.

“We face serious challenges from a new administration, a slim majority of House Democrats and a 50-50 Senate to make America a socialist country, and that is at 100% my goal, “McConnell said, dispelling any idea that Republicans are interested in negotiating with Democrats.

Ms Ocasio-Cortez highlighted Republicans’ commitment to filibustering in a follow-up tweet.

“Plus, Senate lockdowns make Biden’s reluctance to act on student debt all the more blatant – something can be done * without * Congress but has not yet done -” she said. written. “#CancelStudentDebt is one of the rare and rare opportunities Biden has to grow up without the Senate. He must take it.”

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