Financial Reforms of 2011


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There are some financial reforms of 2011 that must be appreciated for best practices as the year comes to an end. These reforms include:
1. New Laws on Consumer Finance Came Online: This year the financial industry underwent reforms as the government regulated financial products for best practices. The most popular reformed financial law is known as Dodd-Frank Act. There were many changes that involved regulatory agencies that got reshuffled. There were more restrictions on investment activities in banks, and there were others that went unnoticed by most customers. However, there may be aftermaths of these reforms in future for some customers. They may be good for some and bad for others, depending on their best practices.

2. Consumer Watchdog Came Online: Consumer watchdog was formerly known as the “Foundation for Taxpayer and Consumer Rights.” Consumers got a new way of receiving reports about their burdensome interest rates and loan provisions from financial institutions. Now customers can call the financial bureaus on their hotlines to get things corrected for best practices. This reform also allows customers to take decisions, rework them and easily read and understand the reports. Mortgages and credit card best practices were the priority and they got better.

3. Price for Checking Accounts: Unlike before some accounts started getting charged for being checked as a best practice. Certain balances and deposits allowed free accounting checking but not all. Previously banks implemented these charges in order to get revenue from processing debit card transactions. However, with the reforms for best practices these revenues were cut into half since the new limits on debit cards were implemented. Therefore, for preservation of best practices, banks began charging a certain fee for checking accounts.

4. Rewards on Bank Cards Got Stripped: Interchange fees dropped for financial organizations. This reduced motivation for banks to offer their customers rewards as best practices, upon using debit cards. Therefore, in 2011 reward programs reduced drastically.

5. Drop in Retail Prices: As interchange fees and the cost of processing the debit card dropped in 2011, banks lured customers to use their debit cards more often. Now almost every form of payment involved debit cards as a best practice. This meant that merchants paid lesser interchange fees for each purchase customers made. The fee was 12 cents rather than 44 cents.

6. More Protection for House Loan Shoppers: The Dodd-Frank Act brought new regulations to put an end to some shady tactics mortgage brokers and lenders used for boosting their profits. Interest rates went higher marking limits for mortgage lender, thereby favoring mortgage loan shoppers with best practices.

7. Free Credit Scores Reports: This year customers received entitlement to a free credit report on their credit scores. When auto loans get rejected, customers will receive a free copy of their report. Customers can also order one free copy from each of the three main credit bureaus.

8. Investing Became Safer and Easier: Disclosures got prompt, there was more clarity on cost of fees, and the Dodd-Frank Act implemented other best practices for investing. The Securities and Exchange Commission crafted a standard for executors and stockbrokers. These standards made brokers more careful with investments.

Exchange Commission crafted a standard for executors and stockbrokers. These standards made brokers more careful with investments.

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