Winter 2015 Buying and Borrowing Tips Seven Ideas for Choosing and Managing a Mortgage Wheels and Deals: Finding an Auto Loan That’s Good to Go Are You Ready to Pay by Smartphone?

Buying and Borrowing Tips

ALSO INSIDE Telemarketer Scams: Have a Complaint More Answers to How to Save: When Calls Don’t About Bank? Common Questions Our Latest Tips Ring True A Regulator Can Help

FEDERAL DEPOSIT INSURANCE CORPORATION BUYING AND BORROWING TIPS

Buying or Refinancing a Home? Seven do-it-yourself tips for choosing and managing a mortgage

Do you have a mortgage loan or are Finance Agency recently released the you in the market for one? With results of a survey showing that nearly new disclosures and other consumer half of the consumers who took out protection rules, and fluctuations in a mortgage to buy a home in 2013 interest rates, it’s good to review some did not shop around before applying. key strategies to keep costs down for “Failing to shop means money lost your home loan. for consumers,” the CFPB said. “Consumers who consider the product “Since a mortgage may be the largest offerings of multiple lenders or brokers and most complex financial obligation may save substantial sums.” you will ever enter into, be sure to do your homework before and after As part of the announcement, the you commit to a loan,” said Jonathan CFPB launched an online toolkit Miller, a Deputy Director in the FDIC’s called “Owning a Home” (www. Whether it’s a fixed or adjustable rate, Division of Depositor and Consumer consumerfinance.gov/owning-a-home) be sure you understand all the terms of Protection. to help consumers as they shop for a any loan you are considering before you mortgage and make smarter decisions decide whether to take it. If you have Here are tips on keeping borrowing on home loans. questions, consider consulting with a costs low and thinking ahead about HUD-approved housing counseling issues that might arise. It’s best to compare offers from several agency (see contact information at the different lenders before making a final For Anyone Looking for a Mortgage end of this article) or an attorney. decision. And keep in mind that you do 1. Remember that loan programs not have to use a lender suggested by 4. Watch for new mortgage can change and lenders’ policies may your real estate agent or anyone else disclosures. The CFPB has developed vary, so research new opportunities involved in your home purchase. new disclosures that, by law, lenders will before applying for a mortgage. For be required to use beginning on August 3. Understand the pros and cons example, more lenders are beginning to 1, 2015. For most new mortgages and of adjustable-rate mortgages. Also offer borrowers the chance to obtain a refinancings, four previously required known as ARMs, these mortgage mortgage with a smaller down payment. disclosures of settlement costs and key loans generally start out with low Why is that happening? loan terms (including the “Good Faith introductory rates for a certain time Estimate” provided within three days Fannie Mae and Freddie Mac will period. A low rate may be appealing, of applying for a mortgage and the now buy mortgages from lenders that but be sure you know how much that “HUD-1 Settlement Statement” of have down payments as low as rate could rise, when, and under what actual costs at closing) will be replaced 3 percent. This change could lead to circumstances. By law, the lender must by two new forms intended to provide more lenders lowering their down disclose this information to you. When clearer and more useful information payment requirements for borrowers. the lender considers your ability to to consumers. The CFPB has detailed But be careful. Making a smaller down repay the loan, it must take into account information about the new disclosures payment typically means you will pay possible rate hikes during the first five at www.consumerfinance.gov/ higher monthly mortgage payments years of the loan. knowbeforeyouowe. and have greater borrowing costs over “You also shouldn’t assume that you will the long run. 5. Consider how a mortgage could have the option to refinance an ARM affect you in retirement. Carrying Also, in January 2015, the U.S. or sell your home to escape higher significant mortgage debt can create Department of Housing and Urban payments later on,” said Elizabeth payment problems for retirees living on Development (HUD) announced a cut Khalil, a Senior Policy Analyst at the a fixed income. Some consumers may in Federal Housing Administration FDIC. “Mortgage interest rates have even delay retirement due to mortgage insurance premiums on mortgages with been low over the past few years, but debt. “Even if you’re many years from low down payments. This change will they may be higher in the future, retirement, consider now how long make the FHA’s low down payment meaning that refinancing your ARM you intend to carry a mortgage, have a loans more affordable. may not significantly lower your plan for paying it off, and be sure that payments. This is also a reason to think 2. Don’t be shy about shopping timeframe lines up with your goals for seriously about a fixed-rate loan, which around for a home loan. The career and retirement,” said Kathleen may be somewhat more expensive but Consumer Financial Protection Bureau Keest, also an FDIC Senior Policy has predictable payments.” (CFPB) and the Federal Housing Analyst.

FDIC Consumer News Winter 2015 2 BUYING AND BORROWING TIPS

For Current Homeowners credit limit, usually at a variable interest For further information on the issues rate. 6. Keep an eye on the servicing of addressed here and other topics related your loan. The entity that collects your Also, some HELOCs have low to mortgages, search for previous payments and performs other duties introductory interest rates that can reset articles by topic in FDIC Consumer for your mortgage lender, perhaps at a higher rate. The federal banking News at www.fdic.gov/consumernews. including responding to inquiries and agencies have issued guidance to Also visit www.mymoney.gov and initiating foreclosure actions against financial institutions on the importance consumerfinance.gov/mortgage. delinquent borrowers, is referred to of early notice to borrowers about If you think you need one-on-one as the loan servicer. It may or may not impending rate resets and making help assistance from an independent, reliable be the same company from which you available to those facing rate increases source on topics such as buying a home, got your loan, and it may be replaced that could be difficult to pay. See the getting a loan or avoiding foreclosure, by another servicer over the life of the Winter 2013-2014 edition of FDIC consider contacting a HUD-approved loan, perhaps multiple times. By law, Consumer News (www.fdic.gov/ housing counseling agency (start at you must receive advance notice when consumers/consumer/news/cnwin1314/ 1-800-569-4287 or www.hud.gov/ the servicing of your loan is transferred heloc.html) for more on HELOCs and offices/hsg/sfh/hcc/hcs.cfm) or an to a different company. And under new rate resets. attorney. Q rules, you cannot be charged a late fee if an overdue payment to the new servicer is received within 60 days after the transfer of duties. Wheels and Deals: “If your loan servicer changes, carefully Finding an Auto Loan review your account to confirm that That’s Good to Go your payments are being accurately credited,” suggested Senior Policy Buying a car can be exciting, but don’t Analyst Glenn Gimble. “Also by law, lose sight of how you will pay for it. prior to closing on your loan you must Here are our latest tips on financing a receive a disclosure about how often the vehicle through an auto loan. lender transfers servicing. The answer Review your credit reports long may influence your decision to accept before you go to purchase a car. a loan from this lender or to choose Correcting inaccuracies, such as an a different lender, maybe one that erroneous history of late payments, services its own loans.” can help you get the best loan possible. 7. Research the potential risks and Fixing mistakes may also save you benefits of home equity products. A money on car insurance. loan secured by a homeowner’s “equity” To request free copies of your credit in a home can be an economical way to reports, go to www.annualcreditreport. dealers may be less flexible on the price borrow money because the interest rate com or call 1-877-322-8228. This is the of the vehicle if they don’t expect to is typically low and, for many people, only authorized site to obtain your free make money on the financing. the interest paid will be tax deductible. credit reports. Generally, the equity is the current Don’t hesitate to seek different appraised value of a home minus what Consider getting pre-approved for financing offers. You may be surprised is owed on the mortgage. “As home a loan from at least one financial by how comparison shopping for an values rise in a number of areas, home institution before you go to the auto loan can save you money. While equity products are again becoming dealership. A financial institution, submitting multiple loan applications more popular, but it’s important to keep such as one where you already have an generally can slightly lower your in mind that, just like with a mortgage, account, may offer you a better interest credit score, those for car loans made your home is at risk of loss if you fail to rate than what you get offered through within a short period (such as 14 days, pay the loan,” cautioned Gimble. the dealership. And, don’t share with according to some credit scoring the dealer the interest rate you’ve been models) generally are grouped together There are two basic types of home offered in case you want to explore loan to minimize the effect. equity products. One is a one-time loan options at the showroom. for a lump sum, typically with a fixed Compare loan offers based on the monthly payment. The other is a home Consumer advocates also suggest that Annual Percentage Rate because the equity line of credit (HELOC), which you not even tell the dealer whether APR includes certain fees as well as allows homeowners to borrow money you’ve already been pre-approved for the interest rate. “The size of your one or more times up to an approved a loan until after you’ve negotiated the monthly payment is important, but purchase price. That’s because some continued on the next page FDIC Consumer News Winter 2015 3 BUYING AND BORROWING TIPS resist attempts to focus your attention on the monthly payment instead of the Are You Ready to Leave Your Credit Cards at APR,” said Luke W. Reynolds, Chief Home ... and Pay by Smartphone? of the FDIC’s Outreach and Program Development Section. “Remember, the Paying for purchases by smartphone sign up. A merchant must first install APR reflects the true cost of the loan.” is becoming increasingly viable. card terminals that accept contactless Three major companies now payments; they look different than the The longer your loan, the more you enable consumers to buy goods at swipe terminals you are used to and pay in interest. “Long-term loans may participating merchants with their display the symbol shown below. lower your monthly payment but you credit or debit card by just waving will pay more in interest over the life of a smartphone over the payment the loan,” Reynolds added. “You may terminal. In fact, a major smartphone even be offered a loan that is longer manufacturer recently teamed up with than you expect to keep the car.” many banks and merchants to make Keep good records of your loan the service available to anyone buying quotes. Before signing on the dotted the newest version of its smartphone. As with any electronic transaction, line, review the loan agreement (the What should you know about using pay attention to security issues. contract) and make sure any potential your smartphone to pay in a store or a According to Jeff Kopchik, a Senior fees, the interest rate, and other key restaurant? Policy Analyst at the FDIC, “Many terms match what you were initially You need the right equipment. Your security experts believe that mobile told. smartphone must contain a contactless payments are more secure than swiping your magnetic stripe credit card Don’t allow anyone to steer you or “NFC” (near field communication) because the mobile service keeps your toward a larger purchase and a computer chip that allows it to “talk” credit number in encrypted bigger loan than you will be able to to the payment terminal form and does not transmit comfortably pay. In addition to your via a wireless connection, it to the merchant. But monthly loan payment, you need to as well as a digital wallet you still should make sure budget for the cost of auto insurance, to store your payment your phone is protected, licensing fees and taxes. card information. If you are buying a new such as with a password, Leave the car at the dealership until smartphone, you can so it cannot be accessed your loan terms are finalized. If a ask the salesperson if it by a thief. Some of the dealer offers you a “contingent” or has an NFC chip. For a newest smartphones use “conditional” loan agreement and lets phone you already have, fingerprint readers to you drive the car home, the loan terms check the “settings” control access, which can may change and be less advantageous menu and look for be secure and convenient.” for you when you return to finalize the Photo: NFC Forum “NFC.” Your phone may Also make sure your phone purchase. already have a digital wallet feature. “times out” and re-locks itself after it If you have a problem with your You can also download one through an isn’t used for a short period of time. If lender or its debt collection practices app store or other online marketplace. you lose your smartphone, notify the that you can’t fix on your own, help You have to load your credit or bank or other issuer of any credit or is available. Consider filing a complaint debit card information onto the debit cards that may be loaded on the with the Consumer Financial Protection phone. The setup procedure can be phone. Bureau at https://help.consumerfinance. as easy as taking a picture of the front “Remember that if there is a problem gov/app/vehicleconsumerloan/ask. and back of the card with the mobile with a transaction, you will receive For more information, see articles in wallet application. The app will then the same federal protections that the Fall 2012 issue of FDIC Consumer send it to your bank for approval and otherwise apply to the underlying News (www.fdic.gov/consumers/ to confirm that it’s really you. Some payment source,” noted FDIC Senior consumer/news/cnfall12/autoloans. mobile wallets may allow consumers Policy Analyst Elizabeth Khalil. “For html) and the Spring 2012 edition to load “loyalty” cards from favorite example, if the transaction drew on (www.fdic.gov/consumers/consumer/ retailers. You may also receive store a credit card for payment, you will news/cnspr12/autoloans.html). The or restaurant coupons or other offers be protected by the same laws and Federal Trade Commission also has through your phone, based in part on regulations that cover credit cards.” resources at www.consumer.ftc.gov/ your recent purchase history with the To learn more, start by contacting your articles/0209-buying-new-car. company. Q smartphone service provider or credit Most merchants that accept mobile card issuer. payments are large national chains, Q but smaller stores are beginning to FDIC Consumer News Winter 2015 4 Scams: When Telemarketer Calls Don’t Ring True Have a Complaint About As previously reported in FDIC and don’t press any other number to a Bank? Here’s How a Consumer News, federal rules prohibit a (supposedly) get your phone number variety of unfair or deceptive advertising off a call list. Doing so will probably just Regulator Can Help practices, and they enable consumers to lead to more robocalls. If you think you’re not being treated stop most telemarketer calls by placing Never give out personal identification fairly by your bank, what should their personal phone and cell numbers information over the phone unless you do? As we have previously on the National Do Not Call Registry you initiate the call and know the recommended in FDIC Consumer (www.donotcall.gov). We are returning other party is reputable. This includes News, the quickest way to fix a problem to the telemarketing topic because the bank account and credit card numbers, is to go directly to the institution. But Federal Trade Commission (FTC) and Social Security numbers, account what if that does not help? Consider other agencies have reported increases in passwords and PIN numbers. contacting the bank’s federal regulator. complaints involving telemarketers that may be perpetrating scams or otherwise Thoroughly check out any offer “The FDIC receives thousands of violating federal and state laws. before agreeing to it. Always ask for complaints every year from customers key details in writing. Carefully read seeking assistance,” said Kirk Daniels, According to the FTC, the vast majority all applications and contracts so that a supervisor in FDIC’s Consumer of the violations of the do-not-call you understand your potential costs, Response Center. “For each complaint rules involve “robocalls,” which are risks and requirements. You also can within our jurisdiction, we contact the pre-recorded phone messages that research an offer with help from your institution to review its actions and companies send to thousands of phones state or local consumer protection compliance with federal consumer at the same time. Some companies agency (start at www.usa.gov/directory/ protection laws.” continue to make robocalls to people stateconsumer) or your state Attorney who have signed up for the Do Not Call Information collected through General’s office (www.naag.org/ Registry, using fake “caller IDs” that complaints is shared with FDIC staff to current-attorneys-general.php). make them hard to identify or trace. help identify potential risks for further These calls might be scams. Assume that any offer that “sounds review at upcoming examinations. too good to be true” — especially Michael Benardo, manager of the However, federal regulators cannot take one from a stranger or an unfamiliar FDIC’s Financial Crimes Section, action against a bank if it complied with company — is probably a fraud. explained one scam involving a applicable laws. Likewise, regulatory “Common examples of scams include pre-recorded message supposedly from agencies cannot settle disputes over fake lottery winnings, bogus job offers, a financial institution or a government whether an institution complied with and promises of an investment paying agency, describing some “urgent” the terms of a loan or deposit contract, significantly above market rates,” said matter. “If you return the call, you which is a private matter governed Kathryn Weatherby, a fraud examination might be asked a series of personal by state law. “We don’t have the specialist for the FDIC. questions using the touch-tone keypad authority to determine whose version on your telephone. The information Resist pressure to make a decision of the events is more accurate,” added you are asked to provide, such as immediately. Here are a few red flags Daniels. account numbers, personal identification that can help you spot a scam: If you need help, you may start numbers (PINs), birth dates, and • You’re told to send money or provide with the FDIC by calling toll-free passwords, can be used to access to your bank account information before you 1-877-275-3342, completing a bank account or commit identity theft,” receive anything in return; customer assistance form at www2.fdic. said Benardo. gov/StarsMail/index.asp, or writing to • You sense a reluctance on the part of He added, “Your financial institution the FDIC Consumer Response Center, the caller to answer questions or provide or a government agency would never 1100 Walnut St., Box #11, Kansas written information; and contact you asking for such information. City, MO 64106. If the FDIC is not When in doubt, call your institution • You’re told you already agreed to pay the correct federal agency to handle or the government agency that the call money but you don’t remember that. your complaint, we will forward it to is supposedly from by using a phone that agency or provide you the contact If you think you’re a victim, file a number that you know or that you find, information. complaint with the FTC (at www. not the number in the message.” ftc.gov/complaint or toll-free at For more information about resolving Because it may be difficult to get your 1-877-382-4357) and with your police. complaints, start with our article in the money back, remember the following: For more tips on topics like reducing Spring 2012 FDIC Consumer News at robocalls, avoiding phone scams and www.fdic.gov/consumers/consumer/ If you get a robocall, hang up. Don’t stopping unwanted mail and calls, start news/cnspr12/complaint.html. press “1” to speak to a live operator Q at the FTC’s Web site (www.ftc.gov). Q FDIC Consumer News Winter 2015 5 cases it will put a hold on the use of More Answers to Common Questions the card, but it also can cancel the card Some things to know about the FDIC’s online deposit insurance and issue a new one,” said Heather St. calculator, debt collectors and prepaid debit cards Germain, an FDIC Senior Consumer Affairs Specialist. “These precautions Consumers often seek help from the Even if you had not paid your bills can be inconvenient for the customer, FDIC with questions relating to their as required, you have the right to be but they help limit potential fraud.” bank accounts. That’s why FDIC treated fairly under the Fair Debt As for federal consumer protections, Consumer News occasionally features Collection Practices Act. For example, your liability for an unauthorized questions and answers that readers within five days after initial contact, the transaction varies depending on the may find useful. Check out the latest debt collector must provide a written type of card. For example, debit card collection below. notice stating who you owe money to users are liable for no more than $50 and how much is due. And if you make Do I have to provide personal of fraudulent charges as long as they a written request within 30 days of the information if I use the FDIC's notify their financial institution within initial contact, the debt collector cannot online deposit insurance calculator two business days of realizing that contact you again until they mail you to find out if my deposits are fully their card was lost or stolen. With proof of the debt. “Consumers can use covered? reloadable prepaid cards, federal law this information to make sure that they treats “payroll” cards (for employer “No. ‘EDIE,’ the FDIC's Electronic are actually responsible for paying the deposits of salary or government benefit Deposit Insurance Estimator, does money and that it is not someone else’s payments) the same as debit cards, but not need personal identification responsibility. They also can make sure currently there are no federal consumer information such as your actual name, the amount owed on a legitimate debt protections limiting losses with Social Security number or account is accurate,” explained Edward Hof, an general-purpose prepaid cards. That number,” said Martin Becker, Chief of FDIC Consumer Affairs Specialist. could be changing, though, because the FDIC's Deposit Insurance Section. Also under the law, consumers have the Consumer Financial Protection “EDIE is a site that can help you protections against violence, obscene Bureau (CFPB) has proposed a new rule confidentially calculate your deposit language, repeated calls and other that would increase federal consumer insurance coverage.” abuse. Without the consumer’s protections for prepaid financial For an accurate analysis of your permission or a court order, debt products. Also, industry practices may insurance coverage, though, you collectors cannot contact consumers already limit your losses to some extent, will need to list account owners or before 8 a.m. or after 9 p.m. And, if so check with your card issuer. beneficiaries, but you can type in aliases you tell a debt collector in writing that To help protect yourself, don’t divulge like Jane Doe or Child #1. Also enter you refuse to pay, the collector can only your prepaid card number to anyone information such as the type of account contact you one more time – either to who calls, e-mails or otherwise and the dollar amount to reflect your tell you that all communications have contacts you unexpectedly. Regularly bank accounts correctly. You can use ended or that it will take a specific review your account for unauthorized hypothetical amounts if you want action, such as suing you to collect the transactions (if you are unsure of how to explore opening new accounts or debt. to do so, review the documentation adding to existing account balances. To learn more, start with the Consumer that came with your card) and notify And when you’re done, EDIE doesn't Financial Protection Bureau (www. the financial institution that issued your store any of the details you key in, nor consumerfinance.gov or call toll free prepaid card immediately if you see any can it track users. 1-855-411-2372) and/or the Federal discrepancies. Also, if your prepaid card To use EDIE, go to www.fdic.gov/ Trade Commission (www.consumer. doesn’t work, contact the card provider, edie. You can speak with an expert to ftc.gov/topics/dealing-debt or call explain your situation, find out what discuss your FDIC deposit insurance toll-free 1-877-FTC-HELP). Another happened and ask what you need to do coverage by calling 1-877-ASK-FDIC valuable resource is your state Attorney to access your funds. (1-877-275-3342). General’s office (www.naag.org/ To learn more about reloadable current-attorneys-general.php). What should I do if I have a problem prepaid cards, start at the CFPB Web with a bill collector, and what are my Due to security concerns, my site at www.consumerfinance.gov. rights as a consumer? bank put a temporary “hold” on If new consumer protections are my reloadable prepaid debit card. adopted, we’ll report on them in FDIC Complaints about debt collectors are Can the bank do that? And what Consumer News. And for additional common, with allegations ranging from consumer protections do I have if a information on prepaid cards, see our harassment to fraud (such as when thief used my card? Summer 2012 issue at www.fdic.gov/ criminals use fake documentation to consumers/consumer/news/cnsum12/ trick victims into paying bills that don’t “Yes, if the bank that issues a prepaid paymentcards.html. exist). card suspects a security risk, in most Q

FDIC Consumer News Winter 2015 6 How and Where to Save: Our Latest Tips FDIC Everyone knows they should save Consumer News money to help pay for their future Published by the Federal Deposit needs or wants, but not everyone Insurance Corporation knows the best or easiest ways to Martin J. Gruenberg, Chairman save. That’s why FDIC Consumer News regularly features tips on where Barbara Hagenbaugh, Deputy and how to save efficiently. Our to the Chairman for Communications most recent suggestions appeared Elizabeth Ford, Assistant Director, in the Spring 2014 (www.fdic.gov/ Office of Communications (OCOM) consumers/consumer/news/cnspr14/ Jay Rosenstein, Senior Writer-Editor, savingandinvesting.html) and Fall 2014 OCOM (www.fdic.gov/consumers/consumer/ news/cnfall14/financialcheckup.html) Mitchell W. Crawley, Graphic Designer issues. Here are a few more ideas. FDIC Consumer News is produced Review how and where you are quarterly by the FDIC Office of saving for retirement. Options include Communications in cooperation with workplace retirement plans, Individual other Divisions and Offices. It is Retirement Accounts (IRAs) offered by intended to present information in a Certificates of deposit (CDs), which many banks and investment companies, nontechnical way and is not intended to provide a predetermined fixed- or and the U.S. Treasury Department’s be a legal interpretation of FDIC or other variable-rate interest payment for a set new “myRA” (myRetirement Account), government regulations and policies. time period (usually three months to Due to periodic changes in statutes and which is a simple, safe, and affordable five years), also may be an option. agency rules, always check the FDIC Web savings program to help individuals site — www.fdic.gov — for up-to-date start saving for retirement. The myRA Find more money to save by cutting information. Mention of a product, program offers a new type of Roth IRA, expenses. A great resource for ideas service or company does not constitute guaranteed by a new U.S. Savings Bond on how to use your money wisely is an endorsement. This publication may that costs nothing to open and carries MyMoney.gov, the U.S. government’s be reprinted in whole or in part. Please no risk of losing value. main Web site about personal finances credit FDIC Consumer News. with information from more than 20 Because myRA accounts do not have federal agencies, including the FDIC. Send your story ideas, comments, minimum contribution requirements, Start at the “Spend” page at www. and other suggestions or questions to: savers can contribute the amount mymoney.gov/spend/Pages/spend.aspx. Jay Rosenstein, Editor, FDIC Consumer that best fits their budget. During News, 550 17th Street, NW, Washington, the first phase of the program, myRA If you get a large, one-time DC 20429, e-mail [email protected]. accounts can be funded through “windfall,” consider using some or Find current and past issues at automatic payroll deduction. To open all of it to help build your emergency www.fdic.gov/consumernews or request an account or learn more about the savings. Start by checking whether paper copies by contacting the FDIC myRA program, including eligibility you have enough in a federally insured Public Information Center. Call toll-free deposit account to cover three to six requirements, go to www.myra.treasury. 1-877-ASK-FDIC (1-877-275-3342) or gov or call toll-free 1-855-406-6972. months of essential living expenses. If e-mail [email protected]. you don’t have that much in your “rainy Set savings goals for specific reasons. day fund,” consider adding funds from Subscriptions: To receive an e-mail “Designating accounts that you will a tax refund, an inheritance, or other notice about each new issue with links regularly contribute to for a particular new-found money. This account may to stories, go to www.fdic.gov/about/ purpose, such as for a vacation or the help pay for major unexpected expenses subscriptions/index.html. To receive next holiday season, will help motivate or tide you over during a disruption in FDIC Consumer News in the mail, free you to meet your goals by a certain your income. of charge, call or write the FDIC Public deadline,” said Luke W. Reynolds, Information Center as listed above. Chief of the FDIC’s Outreach and For more ways to save, including ideas Program Development Section. “Some for keeping banking costs down, search For More banks offer ‘club’ accounts that promote for articles in FDIC Consumer News at regular, small savings for a certain www.fdic.gov/consumernews and check Help or Information reason, but you can use regular deposits out the FDIC’s Money Smart financial Go to www.fdic.gov or call the FDIC into any savings account to reach your education program at www.fdic.gov/ toll-free at 1-877-ASK-FDIC target.” moneysmart. Q (1-877-275-3342)

FDIC Consumer News Winter 2015 7 News Briefs

See our money and banking tips for are combining financial education consumers to access a variety of the tax season. Consider reviewing our with safe, low-cost savings accounts databases from different government most recent article on ways to make tax for school children. FDIC-insured and self-regulatory organizations to time less taxing. The Winter 2013/2014 banks in the program are working with learn more about the background of a FDIC Consumer News (www.fdic.gov/ schools and/or nonprofit organizations financial professional. consumers/consumer/news/cnwin1314/ to help children open savings accounts FDIC Consumer News has previously taxtips.html) provides guidance on how in conjunction with financial education cautioned readers to be careful when to guard against tax-related identity programs. The FDIC ultimately hopes buying bank CDs from deposit brokers theft, such as when a criminal calls to highlight promising approaches for because the accounts they sell may and impersonates an IRS employee encouraging the development of good involve more risks than working directly to ask for immediate payment or money management and savings habits with an insured bank. Reminder: The for confidential information. (Note: at a formative age. FDIC does not have the authority to The most common form of identity To learn more, start at www.fdic.gov/ examine, approve or insure deposit theft reported to the Federal Trade youthsavingspilot. brokers, who can be anyone from an Commission in 2014 was tax-related.) individual transacting business alone A new federal Web site can make You’ll also find information on free tax from a home office to a major financial it easier for consumers to conduct preparation services offered through services firm. For more information, a thorough background check of the IRS or IRS-coordinated programs see our article in the Spring 2013 issue financial professionals, including for many taxpayers, plus ideas to put (www.fdic.gov/consumers/consumer/ brokers who offer FDIC-insured some of a tax refund into savings or news/cnspr13/cdsfrombrokers.html). certificates of deposit. The site Q toward paying down debt. from the Commodity Futures The FDIC has launched a pilot Trading Commission (CFTC) — program to identify ways banks www.smartcheck.gov — enables