Research & Policy

From the amicus brief: Unpaid court debt balloons over time as fines and the costs of collection accrue; low-income people risk wage garnishment, asset forfeiture, loss of credit, and even incarceration as collateral consequences of their continued entanglement with the criminal justice system. These burdens fall most heavily on people of color, who are arrested and placed on probation at disproportionate rates compared to white people.

In the letter from 138 undersigned consumer, civil rights, community, housing, labor, small business, and other public interest groups: Commissioner Chopra is exactly the type of leader we need to serve as the next CFPB director. His commitment to consumer protection, effectiveness at using the tools of government to serve the public interest, and willingness to challenge powerful corporate interests when necessary are exactly what the Bureau needs to fulfill its crucial consumer protection mission. He is dedicated to ensuring a fair and equitable financial marketplace for all consumers and...

The Center for Responsible Lending (CRL)1 appreciates the opportunity to comment on the Affordable Housing Goals Advance Notice of Proposed Rulemaking. In exchange for government support, Fannie Mae and Freddie Mac (GSEs) have an explicit public interest mission. This mission is foundational and part of their charters – the GSEs’ very reason for existing.2 The mission includes promoting access to mortgage credit to underserved borrowers, including Black and brown families, serving a countercyclical role in the mortgage market, and FHFA’s duty to reasonably support the safety and soundness of...

Even before COVID-19, student loan borrowers struggled under the weight of more than $1.6 trillion in debt. One in four borrowers was in default or serious delinquency, and many worried about their ability to make student loan payments while covering other basic needs. Because of decades of structural inequities and discrimination, student loans have burdened Black and Latino borrowers more than other groups, and now these borrowers of color are also among those disproportionately harmed by COVID-19. Millions of lives were already stymied by student loan debt before the public health crisis...

The Center for Responsible Lending and Self-Help filed a joint comment to the Federal Reserve Board on its Advance Notice of Proposed Rulemaking on regulations that implement the Community Reinvestment Act (CRA). Read the full comment.

From the comment letter: NCUA’s proposal, which would permit federal credit unions (FCUs) to keep members’ negative account balances open for longer than the current limit of 45 days, offers no evidence that it will achieve its stated goal -- to provide relief to FCU members. At the same time, the proposal fails to consider the significant risks it poses members or include elements to mitigate those risks. Credit union overdraft practices, like those of banks, most heavily impact the financially vulnerable and leave them worse off. During the best of times, any NCUA action related to overdraft...

100 organizations supporting African American, Latino and immigrant-owned businesses across the country, joined in this letter to request that changes be immediately made to the Paycheck Protection Program (PPP) to increase meaningful access for sole proprietors, independent contractors, and self-employed individuals. While the Economic Aid Act addressed many of the impediments to access for business owners of color, barriers remain. Of urgent concern is the continued exclusion of microbusinesses, many owned by people of color in rural and urban communities alike, that cannot access the amount...

Over 800,000 self-employed people were behind on their student debt before the pandemic and may be ineligible or have the perception that they are ineligible for the relief they need to survive in a faltering economy. Because of structural inequities including racial wealth disparities, ongoing discrimination in the labor market, and inadequate funding for colleges that well serve higher numbers of students of color, Black borrowers and other borrowers of color carry more student debt and they have more difficulty paying it off. Acknowledgements: The Center for Responsible Lending (CRL)...

The Center for Responsible Lending applauds Majority Leader Chuck Schumer, Senator Elizabeth Warren; Representatives Pressley, Adams, Bowman, Jones, Omar, and Torres; and Chairwoman Waters for their bicameral resolution urging President Biden to take executive action to cancel up to $50,000 in federal student loan debt using legal authorities already granted by Congress. Cancelling student debt will provide both immediate financial relief to millions of Americans and crucial economic stimulus for everyone during this protracted crisis. This action would also boost GDP and job creation at a...

Today the Center for Responsible Lending (CRL) filed this brief in the Supreme Court in support of Thelma McCoy's petition to have the court take up undue hardship discharge for student debt in bankruptcy. Currently and for some time, different courts of appeal have split in how they interpret what is "undue hardship," with some courts taking a holistic "totality of the circumstances" approach and others following a rigid, demanding test known as the Brunner test. A number of courts representing some of the Blackest areas in the country such as the Fifth Circuit, have interpreted Brunner in...

328 undersigned community, civil rights, climate, health, consumer, labor, and student advocacy organizations wrote to urge President-Elect Biden and Vice President-Elect Harris to boost the economy, tackle racial disparities, and provide much-needed stimulus to help all Americans weather the pandemic and the associated recession by using executive authority to cancel federal student debt on day one of the new administration.

CRL urges FHFA to provide for a streamlined approval process for the GSEs to submit new activities that do not rise to the level of a new product. Otherwise, given the proposed rule’s extraordinarily broad definition of a new activity, the GSEs will be stymied from pursuing new endeavors by excessive red tape and overly burdensome documentation requirements. A streamlined process is particularly important to encourage innovation in creating additional affordable housing activities and pilots, as well as offer new loss mitigation options for borrowers in a time of crisis such as the COVID‐19...

The Center for Responsible Lending and several consumer, faith, community, and civil rights groups wrote to strongly oppose an Office of the Comptroller of the Currency (OCC)’s proposed rule that could unreasonably limit banks’ ability to decide not to serve particular entities, including payday and other predatory lenders. Download the comment letter.

On December 22, 2020, the Center for Responsible Lending (CRL) in partnership with several organizations submitted two letters to the OCC in regard to Oportun's application for a bank charter. CRL takes concern with Oportun's poor underwriting standards that harm the consumers they purport to serve; their intimidating debt collection practices; their new partnership with DolEx Check Cashing stores; and their discussion of the Community Reinvestment Act (CRA). CRL also highlights the need for Oportun to price its loans responsibly at a rate well below a fee-inclusive 36% for larger loans. The...

On December 22, 2020, the Center for Responsible Lending (CRL) in partnership with several organizations submitted two letters to the OCC in regard to Oportun's application for a bank charter. CRL takes concern with Oportun's poor underwriting standards that harm the consumers they purport to serve; their intimidating debt collection practices; their new partnership with DolEx Check Cashing stores; and their discussion of the Community Reinvestment Act (CRA). CRL also highlights the need for Oportun to price its loans responsibly at a rate well below a fee-inclusive 36% for larger loans. The...

Civil rights and consumer groups -- Center for Responsible Lending, National Consumer Law Center, East Bay Community Law Center, National Association for Latino Community Asset Builders, and National Coalition for Asian Pacific Americans Community Development – filed an amicus brief in support of the attorneys general of California, Illinois, and New York in their case against a rule from the Office of the Comptroller of the Currency (OCC) that encourages predatory lending through “rent-a-bank” schemes. The OCC rule facilitates non-bank lenders’ efforts to form superficial partnerships with...

It is a truism that small businesses are a critical engine of economic opportunity and growth. This is especially true for communities of color: businesses owned by people of color account for more than 8.7 million jobs at a total annual payroll of $280 billion, and these businesses generate $1.3 trillion in revenue. It is also a truism that for small businesses to thrive and grow into larger enterprises they need to be able to access capital. There is now overwhelming evidence that this is far more difficult for businesses owned by persons of color than it is for white-owned businesses. For...

The Center for Responsible Lending and the undersigned consumer, civil rights, community and faithbased organizations oppose the Bureau’s plans to engage in payday loan disclosure testing. We do so in the broader context of the Bureau’s having repealed much-needed substantive ability-to-repay protections without basis and in light of the overwhelming evidence that disclosures will not protect consumers from the harms associated with payday lenders’ practice of making payday loans without reasonable ability-to-repay determinations. New disclosures would only provide a false veneer of...

Key points from the poll results include: Forty-five percent of NC student loan borrowers report a decrease in their household income since the onset of COVID-19, with the most severe impact hitting borrowers who earn less than $50,000 per year (55% reporting a decrease). Seventy-three percent of NC student loan borrowers report that their student loans cause them stress. Additionally, more than two-thirds of borrowers (69%) report they would have trouble with an unexpected emergency or are already falling behind in their finances. Almost one in four (24%) NC student loan borrowers is unaware...

Our comment discusses ECOA’s purpose, the importance of disparate impact theory, issues around artificial intelligence and machine learning models, special purpose credit programs, preemption, and small business lending. Additionally, CRL signed on to a detailed letter from the Americans for Financial Reform (AFR) Language Access Taskforce regarding the challenges in serving limited English proficient consumers.

Even before COVID-19, student loan borrowers struggled under the weight of more than $1.6 trillion in debt. One in four borrowers was in default or serious delinquency, and many worried about their ability to make student loan payments while covering other basic needs. Because of decades of structural inequities and discrimination, student loans have burdened Black and Latino borrowers more than other groups, and now these borrowers of color are also among those disproportionately harmed by COVID-19. Millions of lives were already stymied by student loan debt before the public health crisis...

The COVID-19 crisis has profound financial impacts on families across the country and on the economy overall. With businesses shuttered (including 40% of Black businesses) and record-breaking unemployment claims filed since March 2020, it is hard to overstate the financial instability and hardship this global pandemic has produced. And it will only get worse. The federal government’s response to the COVID-19 global pandemic has failed to meet the needs of Americans who are forced to choose between staying healthy and working in essential, often low-paying, jobs. Even as the recovery lags, the...

Download a table of state student loan servicing laws from the report. (Updated September 2022) Today, 44 million Americans are saddled with student loan debt. They currently owe over $1.5 trillion—an amount which has more than doubled over the last decade. The causes of this exploding debt burden are many: increasing tuition, stagnant wages, the shifting role of federal government in student lending, divestment from higher education, and the growth in predatory for-profit colleges. Poor servicing practices, particularly placing borrowers in consecutive forbearances instead of appropriate...

A legacy of racial discrimination in housing, lending, banking, policing, employment, and otherwise, has produced dramatically inequitable outcomes that persist today. Communities of color, often largely segregated due to the history of redlining and other racially exclusionary housing policy, experience higher rates of poverty, lower wages, and higher cost burdens to pay for basic living expenses. Payday loans cause particular harm to these communities. Payday lenders target borrowers of color, in part by concentrating their locations in communities of color. Indeed, the communities most...

Through this poll we explore the financial impacts of COVID-19 on Pennsylvanians. The poll was conducted in June 2020 among a national sample of 415 Pennsylvania student loan borrowers in repayment.