CRL Statement on Fed/OCC Servicer Compensation

The remedies are deeply inadequate in fundamental ways. The money will too often be too little too late, particularly for borrowers who were wrongfully denied loan modifications. The federal bank regulators continue to withhold too many details from the public, when transparency would be to everyone's benefit. Further, the Sept. 31 st deadline to apply for compensation for borrowers who believe they were wronged is too soon. It should be extended through year's end, especially since a large mailing was just sent out saying the deadline is July 31. The regulators did get one thing right: They

Bankers Nationwide Fight Lending Protections in California

Californians need Attorney General Harris' Homeowner Bill of Rights to fix mortgage lending abuses and speed economic recovery. But lobbyists fighting it in Sacramento have now enlisted mortgage bankers from around the country to help them defeat it. (Read the e-mail sent by the Mortgage Action Alliance, the Mortgage Bankers Association's national e-advocacy division.) The MBA urged members nationwide to "Stop the Damaging Unintended Consequences of Sweeping California Legislation," and oppose common-sense protections of the Homeowner Bill of Rights, a legislative package modeled on the recent

CRL-California Statement on Gov. Brown's May Revise

California's dire budget situation claimed a new casualty in the governor's May Revise yesterday: $410 million in bank penalty funds from the National Mortgage Settlement intended to assist California homeowners.The governor instead proposed to use the funds to reduce the state's deficit rather than to help borrowers access settlement programs. Attorney General Kamala Harris worked for well over a year to reach an acceptable settlement with banks who had harmed California homeowners with robo-signing and other mortgage servicing abuses. The $410 million in penalties paid by five big banks had

Predatory Credit Card Practices Hurt Banks’ Bottom Line

Credit card losses in the current downturn mounted faster at banks using unfair, deceptive card practices, new CRL research finds. That's because high-cost penalty fees and interest rates were not used to mitigate risk—as credit card issuers claimed—but instead were the risk that led to higher default rates. Read the report, " Predatory Credit Card Lending: Unsafe, Unsound for Consumers and Lenders ." In addition to showing that practices that hurt consumers also hurt credit card issuers, the study finds: Bad practices are a better predictor of consumer complaints and an issuer's losses during

Voters Want Missouri to be Fourth State to End 400% Interest Rates by Ballot

Missourians hope to vote in November on a proposal to limit the interest rate on payday, car title, and installment loans. If successful, Missouri will be the fourth state in four years to approve a reduction of interest rates on payday loans from 400% annual interest to 36% or less. The other states include Montana, Arizona, and Ohio, and in each of them voters approved an end to 400% interest rates by a two-to-one margin. Missourians moved one-step closer to their goal on Sunday, May 6, by submitting hundreds of thousands of signatures from across the state in support of reining in high-cost

“Yo-Yo” Car-Dealer Scams Rig the Game, Push Buyers into Bad Loans

Car dealers often target consumers with poor or no credit for yo-yo scams, a new CRL report demonstrates. "Yo-yo scams occur when a dealer leads a car buyer to believe financing is final," says CRL senior researcher Delvin Davis, author of the report, Deal or No Deal: How Yo-Yo Scams Rig the Game against Car Buyers. "The dealer lures the consumer back to the dealership, claims the financing fell through, and then pressures the consumer to agree to a new loan at a higher interest rate." For the full report go to: http://rspnsb.li/yo-yo-scams. The report also found that dealers involved in yo-yo

End predatory bank payday lending now, 250 groups tell bank regulators

Two hundred and fifty national, state and local organizations and individual advocates have asked bank regulators to stop banks from making predatory payday loans, which carry triple-digit annual interest rates of as much as 400 percent. On Wednesday, a New York consumer group presented a letter signed jointly by the groups to Richard Cordray, Director of the Consumer Financial Protection Bureau, as the CFPB seeks information on checking account practices in New York City. The Federal Reserve Board, the FDIC and the OCC were sent copies of the letter this morning. The CFPB is collecting

AG Settlement Ends Robo-Signing, Provides Model

"The foreclosure settlement announced today will help build a stronger housing market while keeping more people in their homes. But while a significant step toward fixing the foreclosure crisis, this settlement was never intended or able to provide a comprehensive remedy. Much more work is required. Despite its limitations, the settlement requires real reforms in the mortgage servicing industry to stop sloppy business practices and out-and-out fraud. It also will help stabilize housing markets and property values by giving more homeowners a chance to restructure or refinance out of

CRL Response to Wall Street Journal Editorial (1/31/12) on Payday Lending

Dear Wall Street Journal: Your editorial, "Bashing Payday Lenders; Obama targets another industry that serves low-income Americans," is wrong on every point. Payday lending doesn't help low-income families; it traps them in a cycle of debt leaving them worse off. Imagine paying $90 dollars in interest each month if you carried a $300 credit card balance that you couldn't afford to pay off all at once. This is essentially how payday loans operate. Just like unfair overdraft fees and other high-cost products, it's a bad deal. Brick-and-mortar payday lenders and online lenders operate the same

AG Settlement: Not Perfect, but Significant Reform of Mortgage Servicing

Washington, D.C. --- Based on what we've heard, the settlement between major banks and states' Attorneys General (AGs), the federal Department of Housing and Urban Development, and the Department of Justice would represent an important step forward in addressing foreclosure abuses. The settlement would include key reforms to clean up unfair mortgage servicing practices. It would also provide an important template for ways banks can use principal reduction to reduce unnecessary foreclosures and put the country back on a path to economic recovery. Not all details are available yet, and we will