1.

I hear rumors that my bank is closing. What should I do? Although you may hear rumors that your bank is failing, the only credible word comes from the Federal Deposit Insurance Corporation (FDIC). The FDIC currently insures deposits up to $250,000 per customer. Of the nearly 8,000 banks in the United States, 140 failed in 2009, so the odds of your bank failing are quite low. However, if your bank does fail, rest assured your insured deposits are safe. The FDIC will manage the failure and ensure that you have uninterrupted access to your money, checks, bank cards and ATMs.  Learn more about your bank.

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3.

Where is the safest place for my money? The bank is still the safest place for your money. In an FDIC insured bank, customers' bank deposits are protected up to $250,000 per depositor per insured bank. Not one penny has ever been lost by a customer of a federally insured bank. If you need more coverage, your banker can explain your coverage limits and give you options to ensure that all of your deposits are insured. FDIC's Electronic Deposit Insurance Estimator.

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5.

Are banks lending money? Banks are continuing to lend money. Even during our economic hardships with businesses reducing their borrowing, banks have continued to lend. In fact, banks made $1.2 trillion in new loans in 2009.  Generally speaking, when economic conditions are robust, banks extend credit more freely, and when economic conditions are poor, banks extend credit less freely. People with a good credit history will continue to have access to mortgage, credit card and other types of loans. Appropriately, many banks are taking steps to limit risk in the current economic environment, so they have tightened lending standards.  That's why it's important to monitor your credit report and maintain a good credit history.

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6.

Why has my credit card limit been reduced? Banks have continued to lend money and credit cards remain readily available. Credit cards are unsecured loans meaning the only guarantee a lender has for repayment is the borrower's promise to repay.   In reaction to broader economic forces and a riskier lending environment some credit card issuers may decide to lower limits for some borrowers.  ABA's Consumer Guide to Credit Cards.

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7.

I have a positive credit history so why has my APR increased? Credit cards are the riskiest form of consumer lending, with the only security for the lender being the borrower's promise to repay.  As the risks associated with all types of lending have increased during these tough economic times, so have the risks associated with credit card lending, even if there has been no change in individual customer behavior.  Card issuers adjust to changing risks by making modifications to APR, but customers who pay their credit card balance in full each billing cycle will avoid APR charges entirely.

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10.

Is AIG a bank?   No. AIG, or American International Group, is not a bank. AIG is a major insurance corporation that suffered losses during the real-estate meltdown. As mortgage markets declined, AIG's assets lost considerable value, putting the company in danger of failing. Due to AIG's wide-ranging presence and role in our country's financial system, the Treasury extended support to prevent its immediate failure.

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11.

What's the difference between an investment bank like Lehman Brothers and my bank? Traditional banks and thrift institutions take deposits for checking and savings accounts from consumers and businesses. These deposits are insured by the FDIC for up to $250,000 per depositor per insured bank. These banks lend this money to consumers and companies for autos, homes, business equipment, etc. Investment banks, unlike traditional banks and thrift institutions, primary purpose is to facilitate the sale of stocks and bonds. These Wall Street firms operate as advisers and agents for companies that want to raise capital, often by issuing more stock or other securities.

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13.

Is there help for people facing foreclosures? Yes, the first step is to contact your lender. About half of the people entering into foreclosure have not contacted their lender.  Lenders want you to keep your home and many will work with you to do so.  You can also contact HOPEnow, to see if you qualify for a mortgage modification or contact the Homeownership Preservation Foundation (888-995-HOPE), which offers free foreclosure prevention counseling.  There is additional help for homeowners whose mortgages are held by either Fannie Mae or Freddie Mac through the new Making Home Affordable plan.

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14.

What is the new Making Home Affordable Plan? The new plan will help homeowners whose mortgages are held by Fannie Mae or Freddie Mac to refinance into a more affordable mortgage. Under this plan borrowers will be able to modify their mortgages and have mortgage payments they can afford. More on the Making Home Affordable plan.

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15.	How do I know what financial institution holds my loan? Contact your mortgage servicer, call (888) 679-6377 or go to www.mers-servicerid.org to find out the institution that holds your loan.

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