Financially-reformed Cap from StopBuyingCrap.com (love the domain name) found one unpleasant surprise when he signed up for Quizzle: an unauthorized balance for $20,000 on his free credit report. Not fun.

After some investigation, Cap realized the debt had been opened a family member. Lucky enough to pinpoint the source, Cap can make sure the debt gets paid and off his report as soon as possible. For some people not lucky enough to find offenders, fixing identity fraud can be a long and harrowing road with little recourse available.

Paraphrasing here from the Federal Trade Commission, here are the steps to take if you’ve been the victim of identity theft:

1. Get copies of your credit report from every bureau and place a fraud alert. You only need to contact one of the bureaus – that company is required to alert the other two. Here is the contact info for each bureau:

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The 10 brilliant minds who make up the Federal Reserve met yesterday to once again discuss the state of the economy and determine the action needed by them to aid a struggling American economy. In an aggressive move, they lowered another 1/2 percent, resulting in a historically low 1% Fed funds rate. The Fed funds rate is one way the Fed uses to regulate the supply of money to the US Economy.

The following is an official press release from the Fed regarding its decision today, and a translation (for the rest of us) of all the financial jargon by Bob Walters, Chief Economist for Quicken Loans:

Release Date: October 29, 2008

For immediate release

Now

The Federal Open Market Committee decided today to lower its target for the federal funds rate 50 basis points to 1 percent.

The 10 folks who get to decide what short term rates will be (the Open Market Committee) decided to slash short term rates from 1.5% to 1.0%.  They did this to hopefully drop short term rates to encourage banks to lend and people to borrow (so they will hopefully make more stuff, buy more stuff and create more jobs) to help the economy start growing again.

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Got something big to tell you all about. HUGE. Ginormous - and yes, that is a real word.

The video is on CNBC. It’s in the newspapers. And I mean, really….that’s just how Quizzle blog rolls. Ginormously.

Back to the news. Told y’all about the bailout bill last week, right? Well, it finally passed.  But here at Quizzle and Quicken Loans, we don’t feel it addresses the real issue - you. You, who read the bill and said “What the hell? What about me?” It’s true. While the bailout bill is a step in the road to America’s economic recovery, it ignores the struggling homeowner - the very individuals who need the most help.

So being the great guy he is, our Chairman Dan Gilbert took the time to sit down and come up with something that actually addresses the homeowners. After a collaboration of some of the greatest minds we know, we’re proud to have an official proposal to help end the housing crisis. We even worked the weekend and put together a new site for you to reference. You can find it here - www.ASolutionThatWorks.com.

While the site’s name (A Solution That Works) says it all, here is a summary of our official proposal -

The Housing Crisis Problem

• At the core of the financial crisis is the housing crisis, which needs to be addressed.
• Stabilizing Wall Street and the banking system is only a start. The current bill does not forestall the tide of foreclosures that are to come.
• Adjusting ARMS, high foreclosures, low property values and an oversupply of housing have combined to form a “death spiral” in the housing market
• The $700B bailout does not address this. That plan (1) doesn’t address how prices will be set for the loans (2) causes unfair results for borrowers who have dutifully made their payments (3) is potentially extremely expensive for the taxpayers (4) will take a long time to have an impact (5) doesn’t address the root cause of the messed up housing market

Our housing crisis proposal is a solution that:

1. Keeps homeowners in their homes with fixed affordable amortizing monthly payments
2. Costs the tax payers a fraction of the cost
3. Stabilizes prices and stops free fall in home values
4. Gives investors higher odds of recovering their investment in these loans/securities vs. expensive foreclosure and resale in declining spiral of housing market

How our solution to the housing crisis works:

• Focus on specific types of loans, each of which must be owner occupied: (1) ARMS with no caps (2) Option Arms (3) interest only loans.
• Require servicers of these loans to reset the borrower’s rate to 6.375% fixed with a 30 year term/amortization. But the borrower only pays 4.875%; thus, government pays/subsidizes the difference between 6.375% and 4.875%.
• Over the ensuing 6 years, gradually raise the rate the borrower pays and lower the amount of the government subsidy until year 6, when the borrower pays a rate of 6.375% for the remaining term of the loan.
• The lender/servicer has a one-time chance to write off any negative equity and receive two times the normal write-off
• All prepayment penalties on these loans are voided
• Homeowners get the benefit of lower payment for the first 5 years, and then a low fixed rate for the next 25. They get to keep their homes. Their homes values (and neighborhoods) stabilize.
• Lenders are in a much better position than if they had to forecloses on these borrowers, and the stability this brings to the housing market helps them with their bank owned homes
• Taxpayers receive benefit because this costs an estimated $50B spread over 5 years– a fraction (1/14th) of the cost of the $700B plan

Again, for the full proposal to fix the housing crisis and to get involved, please visit www.ASolutionThatWorks.com. Or you can visit Quicken Loans blog, What’s The DIFF? at www.WhatsTheDIFF.com. And please, please feel free to share this with everyone you know. Quizzle loves you.

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Fannie Mae, Freddie Mac, AIG, Bear Stearns, Lehman Brothers - it’s all adding up to become one of the most historical financial times America has ever witnessed. And with what feels to be a huge, festering financial wound, America will need the equivalent of a Wall-Street-sized-Band-Aid. And some antiseptic – the kind that burns. Because only when it burns do we know it’s working.

The Bush Administration has proposed a whopper of a plan – a $700 billion injection of cash straight to the source of pain – the banking industry. Though it was rejected yesterday by the House (225 to 208 vote), something close to the original proposal will still likely be passed soon. The bulk of the money is earmarked to buy the debts of battered banks. Why take on their debt, you might ask? One of the popular theories here is that some of that debt will be bought at such a low price that it could return a profit in the future.

The next plausible question is – where is this new money coming from? Who’s got the $700 billion? Taxpayers do. According to the New York Times, “Divided across the population, it would amount to more than $2,000 for every man, woman and child in the United States.” Burns a little, doesn’t it? It gets better.

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The 10 brilliant minds who make up the Federal Reserve met yesterday to once again discuss the state of the economy and determine the action needed by them to aid a struggling American economy. For the 2nd time in a row, they chose to keep the Fed funds rate steady at 2%.

The following is an official press release from the Fed regarding its decision today, and a translation (for the rest of us) of all the financial jargon by Bob Walters, Chief Economist for Quicken Loans:

Release Date: September 16, 2008

For immediate release

Bob: Now

The Federal Open Market Committee decided today to keep its target for the federal funds rate at 2 percent.

Bob: The 10 people who determine the direction of short term rates (Federal Open Market Committee or FOMC) decided to keep the short term rate that banks lend money to each other at 2%.

Strains in financial markets have increased significantly and labor markets have weakened further. Economic growth appears to have slowed recently, partly reflecting a softening of household spending. Tight credit conditions, the ongoing housing contraction, and some slowing in export growth are likely to weigh on economic growth over the next few quarters. Over time, the substantial easing of monetary policy, combined with ongoing measures to foster market liquidity, should help to promote moderate economic growth.

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