Category: Money Matters

Freezing Credit Will Now Be Free. Here’s Why You Should Go for It.

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Consumers will soon be able to freeze their credit files without charge. So if you have not yet frozen your files — a recommended step to foil identity theft — now is a good time to take action, consumer advocates say.

Security freezes, often called credit freezes, are “absolutely” the best way to prevent criminals from using your personal information to open new accounts in your name, said Paul Stephens, director of policy and advocacy with Privacy Rights Clearinghouse, a consumer advocacy nonprofit group.

Free freezes, which will be available next Friday, were required as part of broader financial legislation signed in May by President Trump.

Free security freezes were already available in some states and in certain situations, but the federal law requires that they be made available nationally. Two of the three major credit reporting bureaus, Equifax and TransUnion, have already abandoned the fees. The third, Experian, said it would begin offering free credit freezes next Friday. To be effective, freezes must be placed at all three bureaus.

The Federal Trade Commission says that when the law takes effect, its identity theft website will provide links to each bureau’s freeze website.

A security freeze makes it harder for criminals to use stolen information to open fraudulent new accounts, or borrow money, in your name. Credit bureaus house records of your accounts and payment history, which card companies and lenders use to decide whether you are likely to pay your bills. If you freeze your file, the bureaus will not provide information to lenders unless you “thaw” the freeze first, using a special personal identification number.

Free security freezes are becoming available more than a year after a huge data breach was discovered at Equifax. The breach compromised the personal information, including Social Security numbers, birth dates and other sensitive details, of more than 145 million people — nearly half the population of the United States.

Despite the scale of that breach, and a steady stream of other incidents, security freezes have not really caught on. An AARP survey of about 2,000 adults found that just 14 percent had frozen their credit files. (The survey, conducted in July by GfK Group using a probability-based online panel, has a margin of sampling error of plus or minus two percentage points.)

In-depth interviews with 24 consumers by researchers at the University of Michigan School of Information found that many people knew about the Equifax breach, but few had taken the step of freezing their credit files as a result.

Consumers suffer from “optimism bias,” the researchers found. They realized that the breach created risk, but did not think anything would happen to them personally. “People tend to underestimate their own risk,” said Florian Schaub, an assistant professor at the school and one of the study’s authors.

Others incorrectly assumed that because they had poor credit or little wealth, they would be unattractive targets for identity thieves. “They think: ‘I don’t have much money. I have nothing to lose,’” Mr. Schaub said. “But that’s not how identity thieves operate.”

People interviewed also cited the cost of freezes as a barrier. It can cost as much as $10 per bureau to place a freeze, and a similar fee is charged to thaw it temporarily when you want to apply for credit.

Consumer advocates hope that making freezes free will spur more consumers to use them. (The new law requires that a thaw must also be free.)

But the freeze process is not as easy as it could be, said Mike Litt, consumer campaign director for U.S. PIRG, the consumer advocacy group. He would prefer credit files to be “frozen” by default, and thawed on request. As it stands, consumers must place freezes separately at all three bureaus, and keep track of three PINs.

And because it’s not always possible to know in advance what credit bureau a lender will use, consumers typically must lift the freezes at all three bureaus when they want to apply for new credit.

Brett Merfish, a lawyer in Austin, Tex., said she froze her credit at all three bureaus several years ago, after her personal information was used to open “a steady flow” of fraudulent credit card accounts. The freeze process was “tedious,” she recalled, but ultimately effective because she no longer has problems with fake accounts. “It’s worth it to do it,” she said.

One credit bureau, TransUnion, introduced a smartphone app, myTransUnion, this month that consumers can use to more easily freeze and thaw their credit. The app is available for both Apple and Android phones. Mr. Stephens, of the Privacy Rights Clearinghouse, said he had not seen the app, but cautioned consumers to tread carefully, in case it is used to market other, fee-based products and services.

The credit bureaus also offer something called a credit “lock,” which they promote as a more convenient way to protect your information. But some offerings carry fees, and consumer advocates prefer freezes because the rules are set by law, rather than by the credit bureaus.

One other less-protective option is a fraud alert, which requires credit bureaus to contact you to verify your identity when a company requests your credit file. Under the new law, initial fraud alerts must last for one year once established. Fraud alerts are free, and, unlike the freezes, an alert placed at one bureau is automatically placed at all three.

U.S. PIRG also recommends freezing your file at a lesser-known reporting agency known as the National Consumer Telecom and Utilities Exchange. The exchange provides credit information to some cellphone, pay television and utility companies. (Some consumers have reported having cellular accounts opened in their names, even though they had placed freezes on their credit reports at the main bureaus.)

The website for the utilities exchange says its database is “housed and managed” by Equifax. But the exchange is a “distinct” entity that requires its own freeze, said Craig Caesar, outside counsel to the exchange. “A separate request to N.C.T.U.E. is required because it is a separate database,” Mr. Caesar said in an email. There is no cost for a freeze, he said.

The new law also requires credit bureaus to allow parents to create and freeze credit files for their children under 16, to prevent their identities from being misused. The Federal Trade Commission offers information on what to do.

Freezes will not protect you from other types of fraud, like someone using the number of a credit card you already have, or impersonating you online to claim your Social Security benefits. To help prevent those types of theft, Mr. Litt recommends checking your credit card statements regularly for suspicious charges, and setting up and monitoring an online Social Security account, to prevent criminals from opening one first and diverting your benefit checks. A PIRG report suggests other helpful steps as well.

Checking your credit report periodically is also wise. You are entitled to one free copy each year from the big three bureaus at annualcreditreport.com. (A security freeze will not prevent you from getting your free annual report, the F.T.C. says.)

Here are the websites to visit to set up security freezes:

TransUnion: transunion.com/credit-freeze

Experian: experian.com/freeze/center.html

Equifax: www.freeze.equifax.com/Freeze/jsp/SFF_PersonalIDInfo.jsp

National Consumer Telecom and Utilities Exchange: www.nctue.com/Consumers

The Trump Administration to Restaurants: Take the Tips!

Most Americans assume that when they leave a tip for waiters and bcapital-one-credit-cardartenders, those workers pocket the money. That could become wishful thinking under a Trump administration proposal that would give restaurants and other businesses complete control over the tips earned by their employees.

The Department of Labor recently proposed allowing employers to pool tips and use them as they see fit as long as all of their workers are paid at least the minimum wage, which is $7.25 an hour nationally and higher in some states and cities. Officials argue that this will free restaurants to use some of the tip money to reward lowly dishwashers, line cooks and other workers who toil in the less glamorous quarters and presumably make less than servers who get tips. Using tips to compensate all employees sounds like a worthy cause, but a simple reading of the government’s proposal makes clear that business owners would have no obligation to use the money in this way. They would be free to pocket some or all of that cash, spend it to spiff up the dining room or use it to underwrite $2 margaritas at happy hour. And that’s what makes this proposal so disturbing.

The 3.2 million Americans who work as waiters, waitresses and bartenders include some of the lowest-compensated working people in the country. The median hourly wage for waiters and waitresses was $9.61 an hour last year, according to the Bureau of Labor Statistics. Further, there is a sordid history of restaurant owners who steal tips, and of settlements in which they have agreed to repay workers millions of dollars.

6 Ways to Be Better at Money in 2018

capital-one-credit-cardWelcome to the Smarter Living newsletter. Editor Tim Herrera emails readers once a week with tips and advice for living a better, more fulfilling life. Sign up here to get it in your inbox every Monday morning. Though there’s never a wrong time to get your finances in order, a new year is the perfect excuse to take a deep look at your relationship with money. Whether you’re just starting out in your career or you’re nearing retirement, below is The Times best financial advice from this year on earning and saving more money and, more important, deciding what to do with all of it.

Save a little extra money every week

No, cutting out that indulgent, extra-fancy coffee once a week won’t make you a millionaire, but those small savings truly do add up over time. Find where you’re nickel-and-diming yourself, then see what you can stand to eliminate. Read more »

‘Dear Equifax: You’re Fired.’ If Only It Were That Easy.

The emails have landed in my inbox, one every other day or so since Equifax revealed that cyberthieves had helped themselves to the Social Security numbers and dates of birth of more than 140 million Americans in the company’s files. And though the words differ (and some are unprintable in this space), the messages all end with the same demand: I want out. I want out of Equifax’s system. That company no longer has permission to make money off my personal data. I want them to delete my file and never start a new one.

It’s hard to blame people for wanting to quit in a fit of pique. This is an industry that uses our personal and financial data as its product, and the real customers are the banks and others who want to check up on us. And this breach isn’t like those at other companies that have let their data loose, like Yahoo or Target, where you can simply find another company to patronize. So, can you dump Equifax? And if not, shouldn’t you be able to?

First, some practicalities. When you sign up for a credit card or a mobile phone or any number of other loans or services, you agree — whether you know it or not — for the provider to send a report card on you to credit reporting agencies like Equifax, Experian and TransUnion. So let’s say you no longer trust Equifax to store your data in the wake of its breach. Sure, you could approach all of those providers and try to persuade them not to send data about you to Equifax each month. But it would be far easier to simply ask Equifax to erase your file and not make a new one.

But what happens if you need to borrow money in the future and you have credit files only at Experian and TransUnion? This poses an enormous problem when it comes time to make the biggest of all purchases — a home. Fannie Mae, whose rules govern the standards for many mortgages, wants information from all three credit “repositories,” as the company puts it.

There is already a potential out in the rules that allows for data from just two agencies if that is “the extent of the data available.” While this rule may exist to help people with a limited credit history, there’s no reason Fannie couldn’t also apply it to people with an extensive history that happens to reside only at Experian and TransUnion, and not at Equifax.

This wouldn’t be ideal for the mortgage industry, though. Credit reports tend to be riddled with errors, so lenders prefer a wider range of data to survey. “Lenders will compare the three and make their best guess,” said Pam Dixon, the executive director of the World Privacy Forum, a research group. “They kind of triangulate the errors.”

While it’s a nifty trick when an industry’s rank incompetence seems to necessitate a permanent triumvirate, a better solution might be a duopoly that actually cares about getting the data right.

Lenders who deal in smaller amounts seem flexible enough, and would have to become more so if more people had only two major credit files. American Express already is. It simply looks to the other two big credit bureaus for underwriting guidance if an applicant does not have a file at the third, said Ashley Tufts, a company spokeswoman. (She declined to comment on why American Express planned to continue to send data to Equifax, given the bureau’s now proven inability to protect it.)

Some readers, many of whom will have no need for mortgages or much new credit in the future, have tried to delete their Equifax files since the breach. One person sent letters making his demand to Equifax’s former chief executive, Richard F. Smith, before he retired last week. (The request received no reply.) Others have called the company’s various call centers. Often, they couldn’t get through or waited for more than hour and then spoke to someone who insisted that it was not possible to have a file deleted.

But what happens if you need to borrow money in the future and you have credit files only at Experian and TransUnion? This poses an enormous problem when it comes time to make the biggest of all purchases — a home. Fannie Mae, whose rules govern the standards for many mortgages, wants information from all three credit “repositories,” as the company puts it.

There is already a potential out in the rules that allows for data from just two agencies if that is “the extent of the data available.” While this rule may exist to help people with a limited credit history, there’s no reason Fannie couldn’t also apply it to people with an extensive history that happens to reside only at Experian and TransUnion, and not at Equifax. This wouldn’t be ideal for the mortgage industry, though. Credit reports tend to be riddled with errors, so lenders prefer a wider range of data to survey. “Lenders will compare the three and make their best guess,” said Pam Dixon, the executive director of the World Privacy Forum, a research group. “They kind of triangulate the errors.”

While it’s a nifty trick when an industry’s rank incompetence seems to necessitate a permanent triumvirate, a better solution might be a duopoly that actually cares about getting the data right. 07MONEY-1-master768Lenders who deal in smaller amounts seem flexible enough, and would have to become more so if more people had only two major credit files. American Express already is. It simply looks to the other two big credit bureaus for underwriting guidance if an applicant does not have a file at the third, said Ashley Tufts, a company spokeswoman. (She declined to comment on why American Express planned to continue to send data to Equifax, given the bureau’s now proven inability to protect it.)

Some readers, many of whom will have no need for mortgages or much new credit in the future, have tried to delete their Equifax files since the breach. One person sent letters making his demand to Equifax’s former chief executive, Richard F. Smith, before he retired last week. (The request received no reply.) Others have called the company’s various call centers. Often, they couldn’t get through or waited for more than hour and then spoke to someone who insisted that it was not possible to have a file deleted.

At the Center of Change, Cherry’s Unisex Saturday night in Bedford-Stuyvesant, Brooklyn, where the salon is an almost always-open witness to a neighborhood in the throes of change.

02drunk190.1It was past 1 a.m. in Bedford-Stuyvesant, Brooklyn, on Memorial Day weekend, on Fulton Street between Throop and Nostrand. A few bodegas and a fried chicken spot were open, supported by gaggles of hungry young people bubbling up from the subway every few minutes. Hip-hop from passing cars with windows open or tops down melted into the night. But for the most part, it was quiet. This strip of Fulton is dominated by 26 storefronts that specialize in black hair, but at this hour, most were dark, their gates down.

One shop, however, was open for business. It was a cavernous salon with a black tile floor and white walls, and its door was propped open. Black chairs ringed the room, and an island of hair dryers took up its center. This was Cherry’s Unisex Salon. Two barbers and four customers lounged in chairs. A short, muscular man wearing a black T-shirt and sweatpants, Cory Parker, took off his do-rag and sat in a barber chair, running a hand over short, curly hair as he consulted a chart of 30 men’s haircuts on a wall.

“I want between a 3, an 18 and a 27,” he said over his shoulder to a barber rummaging in a drawer.

“O.K.”

“You’re not even looking at the chart! What did I say I want?”

The barber turned around and peered at the chart. “You said you want an 18, a 23 …” he started. They both laughed.

READ MORE:https://www.nytimes.com/2017/07/07/nyregion/cherrys-unisex-salon-bedford-stuyvesant-brooklyn.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=second-column-region&region=top-news&WT.nav=top-news&_r=0

The Elusive New York City $1,500 Rental

Finding an apartment in New York that does not drain your bank account can feel like a lightbulbnearly impossible task.

Competition is fierce. And for what? Cramped spaces that deliver little more than a grinding commute to work. But knowing where to look — and when to act — can mean the difference between crummy or cozy quarters. Apartments for less than $1,500 a month do exist, as long as you’re willing to take on a roommate or two or explore neighborhoods that might be less than convenient to your work. Price, of course, dictates most searches. Pay too much and a tight budget can spiral into an unmanageable one. More than half of all New Yorkers are considered “cost burdened,” meaning they spend more than a third of their income on rent.

As the city’s population grows, the number of apartments available shrinks, particularly the cheaper ones. The median income for New Yorkers in 2015 was $56,350 a year, which puts median housing costs at $1,409 a month for rent and utilities, according to the New York University Furman Center. Yet in May, the median rent for a Manhattan apartment was $3,475 a month, according to a Douglas Elliman report. To pay that much without being burdened, you’d have to earn $139,000 a year.

“Rents have gone up, there’s no doubt about that,” said Vicki Been, the faculty director at the Furman Center and a former commissioner of the city’s Department of Housing Preservation and Development. “At the same time, people’s incomes have stayed flat. That’s making housing less affordable.”

And what about recent college graduates moving to New York in search of jobs and housing? While someone starting out in finance is looking at a median starting salary of $70,000 a year, jobs in arts and entertainment, for example, offer a much smaller starting median wage of $29,700 a year, according to data provided by the job site GlassDoor.com. Do the math, and many New Yorkers should be paying considerably less than $1,000 a month in rent.

To find those apartments, renters “are going to have to look long and hard,” Ms. Been said. “People are having to make trade-offs. The cheaper the apartment, the further away from transit it is.”

Know Where to Look

The search for apartments fitting a smaller budget often leads to pockets of the city that are rapidly changing, but often lack conveniences like express trains, shops and restaurants. Although rents have been stagnating over the last two years, they are still near historic highs. And neighborhoods that were considered reasonably priced options just a few years ago no longer are.

“We used to do studios in East Harlem all the time,” said Shawn Hindes, a founder of Teacher Space, a brokerage firm that helps new teachers find apartments. “But that’s not really feasible anymore on a teacher’s salary.” The same goes for many Brooklyn neighborhoods. “Five years ago, someone saying ‘I want a place in Crown Heights’ got the pick of the litter,” he said. But that is no longer the case.

In 2016, only about 14 percent of the one-bedroom apartments listed in Crown Heights on StreetEasy were asking less than $1,500-a-month rent; and in Washington Heights, around 10 percent of one-bedrooms asked less than $1,500 a month, according to data provided by StreetEasy.

But head over to a Brooklyn neighborhood like Northeast Flatbush, an area south of Crown Heights, and about 63 percent of the one-bedrooms were listed for less than $1,500 a month last year; while in Norwood in the northwest Bronx, almost 94 percent of them were, according to StreetEasy.

“These are predominantly residential neighborhoods with older housing stock,” said Grant Long, the senior economist for StreetEasy.

Mr. Hindes of Teacher Space said young teachers who once might have looked in East Harlem are now heading to neighborhoods like Morris Heights in the West Bronx. In Brooklyn, neighborhoods like Flatbush, Prospect-Lefferts Gardens and Kensington are getting more traffic, according to Harley Courts, the chief executive of Nooklyn, a brokerage firm that also helps renters find roommates. “Half of our inventory has shifted south in the last 18 months,” deeper into Brooklyn, Mr. Courts said.

Better Pay your Capital One Bill Before they Show up at Your Job

ImageCredit companies are now going through extreme lengths to get what’s owed to them. If you’re a Capital One credit card holder, you may want to take a look at your recent bill and read the new card holder agreements that were sent along with it. This may lessen the shock you receive when you answer your doorbell and it’s a Capital One representative looking to collect on your bill. Or can you imagine the embarrassment when a Capital One representative shows up at your job?

According to Capital One’s new agreement the company may “contact you in any manner we choose” and that such contacts can include calls, emails, texts, faxes or a “personal visit.” Those visits may be anywhere “at your home and at your place of employment.”

But they won’t stop there.

Not only will they visit you during your evening meal, but they will also take measures to “spoof” their phone number when they call you. When a company spoofs their phone number it shows up as a totally different number on your caller id. Tricky, tricksters.  But is it legal?  If Capital One is spoofing their number for the purpose of collecting a debt, it pretty much isn’t. According to the Federal Fair Debt Collection Practices Act, a debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt or to obtain information concerning a consumer.

LA Times reporter, tracked down (ha) a representative from the credit card company to get to the bottom of these new updates. But of course, deny, deny, deny.