Overdraft Loans

Excessive overdraft fees charged by banks and credit unions can cause devastation for financially vulnerable families. Many lenders used predatory policies and practices designed to repeatedly extract excessive fees from customers who could least afford them. Overdraft fees are a leading cause of financial institutions closing a consumer’s account and reentry into the banking system often is exceedingly difficult, increasing the financial insecurity of many consumers. CRL advocates for legislators and regulators to rein in the size and frequency of these fees. We estimate that the savings from these fee eliminations will be between $3 billion to $4 billion for working families.

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Amicus Brief in Roberts v. Capital One Financial Corporation

Amicus Brief in Roberts v. Capital One Financial Corporation

The Center for Responsible Lending (CRL), National Consumer Law Center (NCLC), and New Economy Project filed an amicus brief in Roberts v. Capital One Financial Corporation, in support of the plaintiff, Tawanna M. Roberts, against Capital One’s misleading overdraft fee practice. In the brief, submitted earlier this month, the group urged the U.S. Court of Appeals for the Second Circuit...
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Amicus Brief
Overdraft Fees

Letter on Wells Fargo, CFPB & House Finance Committee Report

Letter on Wells Fargo, CFPB & House Finance Committee Report

The Center for Responsible Lending (CRL) sent a letter to House Financial Services Committee Chairman Jeb Hensarling (R-Texas) and Ranking Member Maxine Waters (D-Calif.) rebutting the committee’s majority staff report criticizing the Consumer Financial Protection Bureau’s (CFPB) role in investigating Wells Fargo’s fraudulent account scheme.
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Letters to Congress
Overdraft Fees

How Overdraft Fees Harm Consumers and Discourage Responsible Bank Products

How Overdraft Fees Harm Consumers and Discourage Responsible Bank Products

An analysis of recently available data confirms that financial institutions continue to engage in abusive overdraft practices and that reform is urgently needed. This issue brief highlights five key concerns: Overdraft fees remain an enormous drain on checking account customers. Using newly available call report data as the starting point, we estimate that consumers pay nearly $14 billion annually in...
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Research
Overdraft Fees

Prepaid Accounts Under the Electronic Fund Transfer Act and the Truth in Lending Act

Prepaid Accounts Under the Electronic Fund Transfer Act and the Truth in Lending Act

In response to a request for comment, CRL offered feedback to the Consumer Financial Protection Bureau about the agency's proposed rule addressing prepaid cards. The CFPB's proposed rule would expand consumer protections on prepaid cards in significant respects. The CRL comment focuses on credit products associated with prepaid cards – with a particular focus on overdraft fees. The CRL comment...
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Comment Letter
Overdraft Fees

Overdraft U: Student Bank Accounts Often Loaded with High Overdraft Fees

Overdraft U: Student Bank Accounts Often Loaded with High Overdraft Fees

Some colleges and banks enter into exclusive agreements to offer students checking accounts – usually these accounts come furnished with a debit card that prominently displays the school logo and can sometimes be used as student ID. For banks, these exclusive agreements mean a captive audience for their bank products (checking accounts, credit card accounts) and usually a customer for...
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Research
Overdraft Fees Student Loans

Comments to Department of Defense: Expanding Credit Protections for Service Members and Their Families

Comments to Department of Defense: Expanding Credit Protections for Service Members and Their Families

Although the Military Lending Act has resulted in significant improvements, Service members continue to be the target of predatory lenders. In 2012, members of the military filed 61,642 complaints with the Federal Trade Commission's Military Sentinel system. Twenty-two percent of complaints filed by enlisted members were about debt collection, banks/lenders and credit cards. The Department of Defense (DoD) invited comments...
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Research
Overdraft Fees

The State of Lending: High-Cost Overdraft Fees

The State of Lending: High-Cost Overdraft Fees

In spite of regulatory changes in recent years, many banks and credit unions continue to charge abusive fees on debit cards and checking accounts. In "High-Cost Overdraft Practices," CRL discusses these findings: In 2011, overdraft fees cost consumers $16.7 billion. Debit card transactions trigger the most expensive fees. On debit card purchases, the median overdraft charge is $35 for a...
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Research
Overdraft Fees

State of Lending: America's Household Balance Sheet Chapter

State of Lending: America's Household Balance Sheet Chapter

This chapter in the State of Lending report series presents a picture of the overall financial status of U.S. consumers today. It is based on data from the Consumer Expenditure survey, the Survey of Consumer Finances, and other national data sources. These sources reveal that, since 2000, American families have faced declining real incomes,a higher cost of living, greater debt...
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Research
Debt Collection & Settlement Mortgage Lending Overdraft Fees Student Loans

Programs to “Bank the Unbanked” Must Guarantee Good Practices

Programs to “Bank the Unbanked” Must Guarantee Good Practices

Bringing the "unbanked" into mainstream banking is good policy only if new account holders are not subject to financial practices that strip funds from these new accounts. Unfortunately, today's mainstream banking environment is fraught with danger for families who do not have a significant cushion of cash at their disposal. Local, state and federal agencies; civic organizations; and financial institutions...
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Research
Overdraft Fees
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