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Press Releases

March 30, 2015
A new report by the Center for Responsible Lending finds that college-bank partnership checking accounts for students offer few benefits to the students who use them. Indeed, some students end up paying more in overdraft fees on these accounts per year than the average student pays for books per year. The student checking accounts studied in this report are those that result from exclusive agreements between banks and colleges. For banks, these agreements mean a captive audience for their products and perhaps a customer for life, as most consumers are unlikely to switch banks. For colleges...
March 26, 2015
CRL president Mike Calhoun delivered the following testimony at the Consumer Financial Protection Bureau field hearing on payday loans in Richmond, VA on March 26, 2015. Opening Remarks Thank you for the opportunity to participate on today's panel. This is a critical hearing for the millions of working families who are snared in the debt trap of unaffordable loans. The history of the regulation of payday lending takes us to the states. Payday loans were legalized only in relatively recent years and only in some states, as the result of payday lenders' pushing for an exception to a state...
March 26, 2015
The Consumer Financial Protection Bureau is offering a first look at where the agency's efforts to rein in the abusive practices of payday and car title lenders are headed. At a hearing in Richmond, VA, the consumer agency will release information outlining a proposed rule and take testimony from a panel of consumer and civil rights advocates as well as industry representatives. Mike Calhoun, president of the Center for Responsible Lending, will present testimony at today's hearing. In advance of the field hearing, Calhoun comments: The proposal endorses the principle that payday...
March 11, 2015
In a speech delivered at Georgia Tech yesterday, President Obama discussed his plans to implement more robust consumer protection for student loan borrowers. Shortly before his address, the president signed a Memorandum directing the Department of Education and other federal agencies to help students better manage their loans. Leslie Parrish, deputy director of research at the Center for Responsible Lending, remarked: Faulty and inaccurate communications are all too common traits among the companies that now service more than $1 trillion of student debt. There is a lack of basic...
March 2, 2015
On Friday, the US Department of Education announced it will end contracts with five student loan debt collectors that collect federal student loan debts on behalf of the government. The Department found that the five companies had a pattern of providing incorrect information to borrowers about their rights to manage their loans and bring them out of default. The Department has also pledged to prepare better guidance for debt collections to comply with consumer protection laws in the future. In response, CRL senior policy analyst Maura Dundon offered the following remarks: Student...
February 26, 2015
This week President Obama directed the Department of Labor to protect families from "conflicted" retirement counsel provided by financial advisors. The Department will kick off a rulemaking process requiring all retirement advisors to abide by a "fiduciary," or trust standard. Gary Kalman, Executive President for Federal Policy commented on the proposed action: When you walk into a bank to set up an IRA or set aside money in your company's retirement plan, you should be able to trust that the person offering advice is considering what's best for you. When an advisor says: 'trust me...
February 20, 2015
Equifax, the consumer credit reporting agency, recently released a report that it said refutes evidence pointing to a growing "bubble" in the subprime auto lending market based on the fact that credit scores were higher for people with subprime auto loans than for people who do not have an auto loan, ignoring the significant concerns raised by recent Center for Responsible Lending research. Equifax attempts to do so in two ways: Equifax argues that any problems in the market are overstated by looking at one data point: lender charge-off rates, and Equifax uses carefully chosen data...
February 19, 2015
Voters from across the political spectrum are deeply concerned about payday lending including loans with interest rates that average 300 percent. Republicans, Democrats and Independents also feel strongly that payday and car title lenders should be required to follow the same kinds of responsible lending practices as banks and other for-profit lenders, according to a new, bipartisan national poll sponsored by the Center for Responsible Lending. The poll comes at a time when the Consumer Financial Protection Bureau is considering new, national rules to govern the controversial, multi-...
February 10, 2015
Update: On February 12, 2015, CRL president Mike Calhoun delivered testimony before the U.S. Senate Committee on Banking, Housing and Urban Affairs; the hearing was entitled "Regulatory Relief for Community Banks and Credit Unions." (Includes video of the full hearing) In his testimony, Calhoun underlined that responsible regulations and regulatory oversight are critical to the success of small lenders. Download a transcript of his entire testimony. (PDF) He also pointed out: Community banks and credit unions are different from their larger, national and international lending...
February 4, 2015
Corinthian Colleges and ECMC Group, Inc., closed a deal to sell most of Corinthian's campuses to ECMC, a student loan debt collector. The sale brings mixed news for students: $480 million to forgive private student loan debts and the elimination of a troubling mandatory arbitration policy – but ECMC may ban class action lawsuits, and many federal loan borrowers get no relief. CRL senior policy analyst Maura Dundon remarked on the sale: The sale of most of Corinthian Colleges' campuses to ECMC closes one chapter in the troubled history of the for-profit college, but it is still...

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