CRL in the News

Majorities of Republican and Democratic voters view the nation’s $1.5 trillion outstanding student loan debt as a “crisis,” according to a new poll commissioned by Americans for Financial Reform and the Center for Responsible Lending. The poll, being released this morning, also shows bipartisan concern over efforts by the Consumer Financial Protection Bureau to scale back efforts to protect student loan borrowers.

Additionally, Scott Astrada—federal advocacy director for the CRL—noted “…If its recommendations are adopted, more Americans would be pulled into deceptive, 100%+ APR loans with high-default rates. These products allow lender profits to soar as the borrower is pulled down into a financial free fall often resulting in involuntary bank account closure, a ruined credit score, and bankruptcy.”

For too long, for-profit colleges have failed to serve the educational purpose for which they were intended. The combination of high-costs and low graduation rates by these bad actors have resulted in unfair burdens for student borrowers and taxpayers. This bill improves accountability for all higher education institutions and creates a sensible path to fix our broken student loan repayment system.

According to a recent poll released by the left-leaning Americans for Financial Reform (AFR) and the Center for Responsible Lending (CRL), 80 percent of American voters are “concerned about CFPB’s efforts to curb enforcement of fair lending rules, ending enforcement of payday lending rules and restricting public access its database of complaints.”

In 2013, the state created a small-dollar loan program to regulate loans between $300 and $2,500. The state caps interest on those loans between 20 and 30 percent, but any loan above $2,500 is the “real Wild, Wild West,” said Graciela Aponte-Diaz, California policy director at the Center for Responsible Lending, a nonprofit focused on consumer lending.

“Before Mick Mulvaney’s tenure at the agency, the CFPB was a champion for working families – giving back billions of dollars in relief to consumers who were cheated by financial companies,” noted Mike Calhoun, CRL president.

As debit cards gained popularity, banks initially rejected transactions if users didn’t have enough money in their accounts, explained Rebecca Borne, of the Center for Responsible Lending, who contributed to the bill as well. Institutions quickly discovered, however, that enabling such transactions to go through and charging the customer a subsequent overdraft fee could be a handy source of income.

“It’s been such a cash cow for banks. They’re deeply committed to their overdraft revenue,” said Rebecca Borne of the Center for Responsible Lending, who also contributed to the bill.

Whether more lending options for consumers is a good thing depends on the quality of those products, says Rebecca Borne, senior policy counsel at the Center for Responsible Lending.

There are 13 such stores in Springfield and Urbana, many clustered on East Main and South Limestone streets. Ohio in all has more than 830 storefronts that offer payday or car title loans, most of which offer both forms of loans, according to a report by the Center for Responsible Lending.