Research & Policy

The Center for Responsible Lending (CRL) opposition letter details the many dangerous aspects of the bill.

Students at Maine’s for-profit colleges carry higher levels of debt, borrow in higher percentages, and have worse repayment rates on that debt compared to their peers at public and private non-profit institutions. Because African Americans, females, and low-income students are disproportionately enrolled in Maine’s for-profit colleges, these poor outcomes fall more heavily on these vulnerable subgroups. This report uses the most recent data released from the U.S. Department of Education (College Scorecard, September 2016) to present a snapshot view of the condition of higher education within...

Despite significant concerns raised by a number of interested parties—including hundreds of advocacy groups, state regulators, and a bipartisan group of Members of Congress—the OCC is moving forward with its fintech charter proposal. This comment letter asserts that the OCC does not have the legal authority to charter non-depositories, that a national bank charter for non-depository fintech institutions will facilitate consumer harm through preemption of strong state laws, and that federal supervision from the OCC is not a substitute for critical safeguards that exist at the state level.

This proposal was created by the undersigned consumer and civil rights groups in response to the United States Senate Committee on Banking, Housing, and Urban Affairs’ (Banking Committee) request for proposals to foster economic growth. The proposals revolve around 1) promoting responsible, sustainable homeownership and other responsible lending products for borrowers from low-and moderate income (LMI) households, communities of color, rural communities, and first time home buyers along with rules and policies that incentivize lenders, and, 2) support for the Consumer Financial Protection...

On Tuesday, March 28, Center for Responsible Lending (CRL) President Mike Calhoun testified before the House Financial Services Committee's Financial Institutions and Consumer Credit Subcommittee for a hearing entitled "The State of Bank Lending in America." He discussed recent trends in lending and how the Dodd-Frank Wall Street Reform and Consumer Protection Act has made the financial industry more accountable to the public. Download the full testimony above and view a list of all four of the hearing witnesses.

Students at Connecticut’s for-profit colleges graduate at lower rates than their peers at public and private non-profit institutions. Those who do graduate carry higher levels of debt and higher default rates on that debt. Because African Americans and Hispanics are disproportionately enrolled in Connecticut’s for-profit colleges, these poor outcomes fall more heavily on people of color. This report uses the most recent data released from the US Department of Education (College Scorecard, September 2016) to present a snapshot view of the condition of higher education within the state of...

The OIRA Insight, Reform, and Accountability Act is portrayed as a mere codification of previous Executive Orders, but in fact it further undermines the rulemaking process. It would codify the numerous burdensome requirements contained in the orders– many of which are biased against protecting the public, vague, and in some cases mutually inconsistent — and would have the disastrous effect of making compliance subject to judicial review. In many instances, the legislation also removes flexibility in the Executive Orders with narrower, inflexible language. Particularly concerning, this bill...

H.R. 1004 will significantly undermine federal agencies’ ability to engage and inform the public in a meaningful and transparent way regarding its work on important science-based rulemakings that will greatly benefit the public. As a result, the bill will lead to decreased public awareness and participation in the rulemaking process in direct contradiction of the Administrative Procedure Act and agencies’ authorizing statutes, which specifically provide for broad stakeholder engagement.

H.R. 998 would establish a new bureaucracy empowered to dismantle long-established science-based public health and safety standards and would make it significantly more difficult for Congress and federal agencies to implement essential future protections. Along with previous bills that have passed the House and the President’s Executive Orders instituting a regulatory freeze and requiring the removal of two rules for every one that is finalized, this legislation demonstrates a concerted attack on the process that Congresses have instituted to protect Americans from those risks that they cannot...

With little difference across party lines, Coloradoans expressed their strong support for a proposal requiring debt buyers, companies that buy old debts and attempt to collect on them, provide appropriate documentation for the debts they collect and sue on. Survey respondents were asked this question: Would you support or oppose a law requiring debt buyers to provide documentation to the consumer and the court showing how much is owed, a copy of the contract and proof that they actually own the debt? Nearly nine out of ten voters—87%—said they would support the proposal. While 90% of Democrats...

Petitioners argue that the Budget Rules are arbitrary and capricious and unsupported by either the language of the statute or the record. This is not the case. The record abundantly supports each feature of the Budget Rules. In fact, the Budget Rules are a textbook balancing act by the Federal Communications Commission of the competing goals of the statute: to allow some unconsented-to automated calls to collect federal debt, while protecting call recipients from invasive and costly calls consistent with the purposes of the Telephone Consumer Protection Act (TCPA).

Students at Colorado’s for-profit colleges have less favorable outcomes in comparison to their peers at public and private non-profit institutions according to several key indicators, and the impact is greater on students of color. This report uses the data released from the US Department of Education (College Scorecard, September 2015) and compares public, private, and for-profit institutions (also referred to as “colleges” or “schools”) on the basis of overall enrollment, average demographic makeup, completion rates, and indications of student financial burden post-graduation. Analyzing this...

The Center for Responsible Lending (CRL), The Leadership Conference on Civil and Human Rights, and the NAACP have sent a letter to Comptroller of the Currency Thomas J. Curry urging him not to offer national charters to financial technology firms, which could severely undermine state oversight and state laws that protect consumers and small business owners from abusive financial products and practices: The Center for Responsible Lending, along with the Leadership Conference on Civil and Human rights and the NAACP, appreciate the opportunity to comment on the Office of the Comptroller of the...

Over 250 consumer, civil rights, and community groups wrote this letter to the Office of the Comptroller of the Currency to express strong opposition to the proposed new federal nonbank lending charters that would enable lenders to avoid state interest rate caps, other state protections, and state oversight. State laws often operate as the primary line of defense for consumers and small businesses; thus, the proposal puts them at great risk. The letter focuses on three main points: The OCC must not undermine state rate caps. The OCC must not weaken states' ability to oversee lenders and take...

Payday and car title loans are small-dollar, high-cost products that thrive on keeping consumers in a cycle of debt. With lenders doing essentially no underwriting, consumers find it easy to obtain these loans, often marketed as a solution to financial emergency. However, the unaffordability of the loan and the lenders extreme leverage over the borrowers – either through direct access to the bank account or threatening repossession of the borrower’s car - makes it very difficult to escape a cycle of debt that can last months, if not years. Debt trap products often lead to other financial harms...

Six years after the Great Recession, American households continue to struggle with consumer debt. According to data reported by the Urban Institute, approximately 77 million Americans – 35 percent of adults with credit files – have debt in collections reported on their credit files. These Americans carry about $1,349 in debt. About 31 percent of Colorado residents have debt in collections. Debt buyers purchase bad debts that were written off by the original creditor. They pay pennies on the dollar and try to collect the full amount. But they have so little information about the underlying...

The 49 consumer, civil rights, small business, and other community organizations signed on to this letter to express strong opposition to new federal nonbank lending charters that would enable chartered entities to avoid state interest rate caps, other state consumer protection laws, and state oversight, putting consumers and small businesses at risk. The Office of the Comptroller of the Currency (OCC) has expressed interest in granting a new type of special purpose "national bank" charter for financial technology ("fintech") firms, including firms that engage in lending and other activities...

Lenders can and do make non-covered loans without regard to the borrower’s ability to repay as scheduled, and doing so can be highly profitable. In particular, high-cost loans provide a significant disincentive against lending based on ability to repay, even absent a coercive repayment mechanism or security. When rates are high, lenders can profit despite significant defaults and can even make profits on loans that default. We urge the Bureau to use its enforcement authority without delay to address unfair and abusive practices related to lending without regard to ability to repay in the high...

The Federal Deposit Insurance Corporation's (FDIC) proposed guidance provides a framework that will require banks to place more stringent requirements on the institutions that they conduct business with. However, as written, the proposed guidance will still enable consumer harm and allow FDIC-supervised institutions to engage in risky relationships with third parties via rent-a-bank lending. We are deeply concerned about the risk this could create for the Federal Deposit Insurance fund, the reputation of FDIC-insured banks, and the FDIC itself, as well as the adverse impact on consumers.

The Federal Housing Finance Agency (FHFA) should consider the impact credit risk transfer structures might have on borrowers. In bringing in private capital, FHFA should be careful to ensure that FHFA does not exchange access to credit or borrower protections for the capital the private market offers. We are concerned that the credit risk transfer programs have the potential to: Increase prices for certain borrowers which would effectively limit access to credit for some creditworthy borrowers. Recent pricing changes by mortgage insurance (MI) companies illustrate this risk. These risks are...

The California State Legislature and the California Attorney General, Kamala Harris, both submitted comments to the Consumer Financial Protection Bureau in favor of strengthening the proposed rule on payday and car-title lending. Download both of the letters with the link above to read the key points laid out to curb these predatory lending practices.

The Consumer Financial Protection Bureau’s (CFPB or the Bureau) proposed rule to address payday, vehicle title, and other certain high-cost installment loans marks the culmination of over four years of extensive information gathering and data analysis by the Bureau. We thank and commend the Bureau for this work, which has resulted in a robust record of evidence that strongly supports taking regulatory action to address unfair and abusive practices in this market. As the Bureau’s proposal makes clear, the record supports a rule rooted in the fundamental principle that lenders should make a...

The Consumer Financial Protection Bureau’s (CFPB or the Bureau) proposed rule to address payday, vehicle title, and other certain high-cost installment loans marks the culmination of over four years of extensive information gathering and data analysis by the Bureau. We thank and commend the Bureau for this work, which has resulted in a robust record of evidence that strongly supports taking regulatory action to address unfair and abusive practices in this market. As the Bureau’s proposal makes clear, the record supports a rule rooted in the fundamental principle that lenders should make a...

This analysis provides a summary of the outline of proposals that the CFPB is considering to address debt collection and CRL’s initial reactions to it. As we review the proposal more closely, our reactions may evolve.

The Center for Responsible Lending strongly supports allowing former ITT students access to the Guaranty Fund. Over the past few years, CRL has been engaged in research and policy regarding for-profit institutions of higher education. During the 2016 legislative session, the Center for Responsible Lending submitted written testimony in support of SB 427, An Act Concerning Higher Education – Institutions of Postsecondary Education – Consumer Protect Provisions. Effective in a few short days, this bill provides critical front-end protections to Maryland students by ensuring that state students...