CRL in the News

Critics also say the costs of the loans are not always transparent. Many charge monthly subscription fees and most charge mandatory fees for instant transfers of funds, though there is typically a no-cost option to receive funds in one to three business days. The average APR for a loan repaid in seven to 14 days was 367%, a rate comparable to payday lending, according to a report from the Center for Responsible Lending.

In the latest episode of The Connector, The Collaborative Executive Director Marquita Robertson and Center for Responsible Lending Director of NC Policy Rochelle Sparko speak with Institute for Emerging Issues Communications Director Jennifer Heiss about what it means to be unbanked, and steps those who are unbanked can take to protect their money and get set up with FDIC insured bank accounts.

In a Nutshell: Earned wage access and cash advance loans appeal to workers who need financial flexibility to tide them over until their next paycheck. According to a recent Center for Responsible Lending analysis, these small-dollar, short-term loans carry costs and risks similar to payday lending products, including high interest, fees, and account overdrafts. The Center for Responsible Lending is a research and advocacy nonprofit dedicated to creating a fairer financial marketplace with opportunities for all families and individuals. This study reveals the expensive and counterproductive

“We commend the Biden-Harris administration for its continued efforts to make student loan repayment fairer for consumers,” said Nadine Chabrier, senior policy and litigation counsel at the Durham-based Center for Responsible Lending. “Congress never required the Department of Education to capitalize most interest on these loans; so, it’s well past time to make things right for the millions of affected borrowers.”

In response to the V.A. Wednesday’s announcement, the National Consumer Law Center (NCLC) and the Center for Responsible Lending (CRL) asked the V.A. to extend the foreclosure pause, which is set to expire on May 31, until the VASP program is widely available.

“We fully support the administration’s commitment to increasing the Pell Grant,” said Jaylon Herbin, director of federal campaigns at the Center for Responsible Lending. “This move signifies a crucial step toward enhancing access to education for all borrowers, but especially borrowers of color in underserved communities,” Herbin said.

“Targeted first-generation down-payment assistance would open doors of opportunity for families who have not benefited from intergenerational transfer of wealth,” Mike Calhoun, president of the Center for Responsible Lending, said in a statement.

The Center for Responsible Lending noted that the down payment assistance the White House wants mirrors a prior proposal it made, as well as the Downpayment Towards Equity Act that passed the House of Representatives in 2021. "Targeted first-generation down payment assistance would open doors of opportunity for families who have not benefited from intergenerational transfer of wealth," said Mike Calhoun, CRL president, in a press release. "This policy would expand the economic security that homeownership brings, and it would help narrow the racial homeownership and wealth gaps."

This effort addresses the challenges faced by many borrowers who, due to complex regulations and mismanagement by loan servicers, have continued making payments beyond the 20 or 25-year forgiveness threshold set by income-driven repayment plans. Nadine Chabrier from the Center for Responsible Lending highlights that financial disincentives for loan servicers have contributed to a lack of transparency about these forgiveness opportunities, leaving borrowers in the dark.

Borrowers with outstanding federal student loan balances that exceed what they originally borrowed may be among those who qualify for the cancellation. A person's student debt can balloon for a number of reasons, said Nadine Chabrier, a senior policy and litigation counsel at the Center for Responsible Lending.