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Press Releases

July 28, 2009
As the Treasury Department urges mortgage servicing companies to step up their efforts to stop foreclosures, the latest available figures show that the number of households at risk of foreclosure is seven times the number of loan modifications, and the gap has increased steadily for the past year. Visit the CRL web site for more information on how foreclosures continue to dwarf modifications. Although loan modifications are up from very low levels last year, the rapid growth of serious delinquencies and new foreclosure starts is swallowing modest gains in efforts by loan companies to...
July 23, 2009
Today the Federal Reserve Board (FRB) issued proposed rules that hold great promise for eliminating abusive and unfair practices that have become commonplace in the mortgage industry. If fully implemented, these rules could remove perverse incentives that now encourage mortgage brokers and lenders to routinely overcharge on mortgages, particularly higher-cost mortgages. Under the proposed rules, brokers and loan officers could no longer get paid more for placing people in more expensive loans. Kickbacks—known as yield-spread premiums (YSPs)—would be completely banned. This...
July 13, 2009
A new policy brief by the Center for Responsible Lending chronicles the repeated failure of federal bank regulators over the years to rein in irresponsible lending practices. Example after example of regulatory delay or inaction demonstrates the need for a stand-alone, independent regulator focused solely on ensuring basic, common-sense safeguards for consumers. For the full report, please go here. Here are some examples of the regulatory lapses documented by CRL in its policy brief, titled "Neglect and Inaction: An Analysis of Federal Banking Regulators' Failure to Enforce Consumer...
July 10, 2009
During the surge of media attention on today's historic meeting between Pope Benedict XVI and President Barack Obama, it is important to note that only days before His Holiness used his own moral authority to express concerns for the current financial crisis. In his encyclical Caritas in Veritate (Charity in Truth), the Pope speaks to the developments that led to the current global economic crisis, naming badly-managed and short-sighted financial practices among its causes. He urges financiers to "rediscover the genuinely ethical foundation of their activity". Pope Benedict's words are...
July 9, 2009
Washington, DC - A full three quarters of the payday industry's loan volume is generated by borrowers who, after repaying one payday loan, must take out another before their next paycheck, new Center for Responsible Lending research shows. Payday churning?repeat borrowing of what payday lenders market as a short-term loan of a few hundred dollars?has been well documented. But the Center for Responsible lending's new report goes further by verifying for the first time how quickly most payday customers must turn around and re-borrow after repaying a previous payday loan. Among the...
July 9, 2009
Payday lenders create their own demand with loan terms that generate rapid re-borrowing A full three quarters of the payday industry's loan volume is generated by borrowers who, after repaying one payday loan, must take out another before their next paycheck, new Center for Responsible Lending research shows. The report comes on the eve of the California Senate Judiciary Committee meeting where AB 377, a highly-flawed payday lending bill, will be considered. That body will review the bill next Tues., July 14. "It's now crystal clear that demand for payday loans is greatly exaggerated...
June 29, 2009
Statement from Michael Calhoun, President, Center for Responsible Lending "Today the Supreme Court announced a decision that will play a major role in how and whether consumer protection laws are enforced. In Andrew Cuomo vs. the Clearing House Association and the Office of the Comptroller of the Currency (OCC), the court overturned lower court decisions, determining that states can enforce their own civil rights laws, including pursuing claims against national banks, when necessary, to ensure that banks follow the law. This Supreme Court decision is a victory for taxpayers, who have...
June 28, 2009
Sue Kwon interviews Ginna Green, from the Center for Responsible Lending about predatory profiling and payday lending. For more information: Ginna Green at (510) 379-5513 or ginna.green@responsiblelending.org.
June 24, 2009
Ellen Harnick, Senior Policy Counsel for the Center for Responsible Lending contributed this guest post to "The Hearing", a blog of the Washington Post. Over the past decade, federal bank regulators looked the other way as responsible loans were crowded out of the market by aggressively marketed financial products carrying hidden costs and fees. Tricky products, whose most "innovative" feature was their ability to obscure their true cost, led a race to the bottom that stifled innovation of any benefit to consumers. The aggressive marketing of these products caused an enormous loss of...
June 23, 2009
Payday lenders, in their battle to win legal authority to charge triple-digit interest rates, argue that stating their typical interest rate as 390 percent annually is misleading because their loans are short term. State policy-makers and even voters have specifically rejected this bogus argument but payday lenders are trying to use it again as the U.S. Congress debates how to stop widespread abuses in the payday industry. A new Center for Responsible Lending issue brief, APR Matters, lays out why that argument doesn't wash. First, the typical payday borrower is actually in debt long term...

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