While car ownership has been a cultural milestone in our society, this tradition is diminishing with a trend toward renting or borrowing rather than owning. This situation is partially related to fewer teenagers opting to obtain a driver’s license. Also, fewer young people are buying homes, giving preference to the flexibility of renting.
The owning of “stuff” is shifting toward “decluttering” and choosing instead to rent items as needed. A strong belief that overconsumption is putting our planet at risk is driving the rise of the sharing economy. In addition, there is a growing trust to value exchanging items with “real people” rather than buying from major companies.
In addition to Zipcar, which rents vehicles by the hour, other rental business models include:
Ann Taylor’s Infinite Style service that allows a person, for a $95 monthly fee, to rent up to three garments at a time.
SnapGoods rents cameras, power tools and home appliances, such as blenders.
Frankfurt airport has a service that allows travelers to store winter coats when flying to warmer climates. Other businesses are considering a service to rent cold weather clothing to travelers arriving from tropical areas.
Since about one-third of new vehicles are leased, Cadillac created the “Book By Cadillac” program allowing a person to exchange up to 18 vehicles a year.
The many empty stores in malls create opportunities for “swap meets” and “rental fairs” for various products, using these spaces to also build connections in the local community.
For additional information on renting instead of buying, click here.
Have students locate examples of sharing economy businesses and rental companies in your community and online.
Have students talk to others to obtain ideas for new types of rental businesses.
What do you believe are the benefits and drawbacks of renting instead of owning?
Describe actions that might be taken to determine needs and ideas for rental businesses in a community.
In March 2018, the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) reported on their 2017 activities to combat illegal debt collection practices. The CFPB handled approximately 84,500 debt collection complaints, making it one of the most prevalent topics of complaints about consumer financial products or services. The Bureau offered five sample letters that consumers may use when they interact with debt collectors.
The FTC resolved 10 cases against 42 defendants and obtained more than $64 million in judgements, focused on curbing egregious debt collection practices, including phantom departments, schools, non-profit organizations, banks, credit unions, other businesses and government agencies. The agency logged more than 60 million views on its webpages, with its videos seen more than 581,000 times at YouTube.com/FTC, and its consumer blogs reaching 199,860 (English) and 50,480 (Spanish) email subscribers.
Millions of Americans are dealing with debt overload every day. If you’re struggling to pay your loans, credit cards or other bills, here are some steps you can take to begin managing your debt problems.
Create a budget.
Try to get a clear picture of your monthly income and expenses.
Contact your creditors about easier ways to make your most important bill payments.
Have a strategy for saving money on interest and fees.
Consider getting help from a reputable credit counselor.
Know your rights if a debt collector contacts you.
Know someone who’s behind on their bills? Maybe debt collectors are calling for payment? The Federal Trade Commission’s new debt collection video can help you understand your legal rights – and may lower your stress level. In the video, you’ll see how bad debt collectors try to get you to pay up. Bad debt collectors will say anything to get you to pay – and they’ll make it feel urgent to get you to pay immediately. But there are laws to protect you. Debt collectors:
Can’t call you before 8 a.m. or after 9 p.m.
Can’t use profanity, threaten violence or harass you to pay
May not lie or pretend to be someone they’re not
Cannot ask you to pay a debt that doesn’t even exist
Can’t threaten you with arrest or deportation
Cannot tell anyone – except your spouse or attorney – about your debt
If a debt collector calls and uses any of these tactics, hang up and report it to the FTC. Remember: you have the right to be treated fairly – no matter what.
Consumers across the country report that they’re getting telephone calls from people trying to collect loans the consumers never received or on loans they did receive for amounts they do not owe. Others are receiving calls from people seeking to recover on loans consumers received but where the creditors never authorized the callers to collect them.
The FTC is warning consumers to be alert for scam artists posing as debt collectors. It may be hard to tell the difference between a legitimate debt collector and a fake one.
A caller may be a fake debt collector if he/she:
is seeking payment on a debt for a loan you do not recognize;
refuses to give you a mailing address or phone number;
asks for personal financial or sensitive information; or
exerts high pressure to try to scare you into paying, such as threatening to have you arrested or to report you to a law enforcement agency.
New Protections Would Limit Collector Contact and Help Ensure the Correct Debt is collected
The Consumer Financial Protection Bureau (CFPB) is considering to overhaul the debt collection market by capping collector contact attempts and by helping to ensure that companies collect the correct debt. Under the proposals being considered, debt collectors would be required to have more and better information about the debt before they collect. As they are collecting, companies would be required to limit communications, clearly disclose debt details, and make it easier to dispute the debt. When responding to disputes, collectors would be prohibited from continuing to pursue debt without sufficient evidence. These requirements and restrictions would follow the debt if it were sold or transferred.
For more information about the proposals under consideration, click here.
Ask students what federal laws already prohibit debt collectors from harassing, oppressing, or abusing consumers.
Ask students if they, their friends or relatives, have ever been harassed by creditors. If so, what were their experiences?
Debt collection market generates more complaints to the Consumer Financial Protection Bureau than any other financial product or service. Why?
What might be some common complaints against debt collectors seeking to collect debt from consumers?
In late July 2016, filed as part of Operation Collection Protection, the Federal Trade Commission (FTC) charged that BAM Financial used lies, threats, intimidation, and other illegal practices to extract payments from consumers. When obscene language, incessant calls, and harassment of family members didn’t get the results they wanted, the defendants got personal. For instance, the defendants told the parent of one purported debtor “No wonder your daughter is in such predicament with a mother like you.” The FTC alleges that they falsely stated to another consumer’s 84-year-old mother that they had a warrant for her daughter’s arrest and later told the consumer they were bounty hunters.
The FTC says BAM’s letters and phone calls were riddled with false threats of litigation. The complaint also charged that in numerous instances, the defendants didn’t follow up within five days of their initial communications with proper validation notices as the law requires.
The settlement with BAM Financial, Everton Financial, Legal Financial Consulting, Luis O. Carrera, and Robert Llaury bans them for life from debt collection agency industry.
It’s more important than ever for students and former students to make smart decisions about financing their college education. Whether you are attending college soon, are a current student, or already have student loans, Consumer Financial Protection Bureau has put together some tools and resources to help you make the best decisions for you.
If you are considering student loans to help pay for school, you not alone—many students need loans to cover their full cost of attendance. If you have to take out student loans, comparing your options can help you find the student loan best suited for your needs.
Consumer financial Protection Bureau has prepared student financial guides, financial aid shopping sheet adopted by more than 500 colleges and universities, and other helpful information on its website.
The Federal Trade Commission (FTC) has charged a debt relief company with falsely representing to financially distressed homeowners and student loan borrowers that it would help get their mortgages and student loans modified. At the FTC’s request, a federal court has temporarily halted the operation. The FTC seeks to permanently stop the alleged illegal practices and obtain refunds for affected consumers.
According to the FTC’s complaint, Good EBusiness LLC deceptively marketed home loan modification services and illegally charged an advance fee of 1,000 to $5,000. The agency alleges that the company falsely claims that it can lower monthly mortgage payments, reduce mortgage interest rates usually within a few months, and falsely promise full refunds if they fail. The FTC’s complaint also alleges that Good EBusiness, using the names Student Loan Help Direct and Select Student Loan; Select Student Loan Help LLC; Select Document Preparation Inc.; illegally charged a fee of $500 to $800 for student loan relief services.