Labor, Civil Rights and Consumer Groups Oppose House Bills That Facilitate Predatory “Fintech” Lending

Groups say bills before House committee hide true cost of cash advance apps, erase consumer protections WASHINGTON, D.C. – The U.S. House of Representatives Financial Services Committee will vote tomorrow morning on several pieces of legislation that could harm consumers. The Center for Responsible Lending (CRL) joined dozens of advocacy organizations in letters opposing two of these bills: the “Earned Wage Access Consumer Protection Act” (H.R. 7428) and “The Financial Services Innovation Act” (H.R. 7440). “High-cost lenders have a well-documented history of targeting and exploiting for profit

Biden-Harris Administration Releases Draft Rules Proposing Student Debt Relief for Tens of Millions of Borrowers

Washington, D.C., — The Biden administration announced today its first set of draft rules proposing billions in student debt forgiveness to more than 30 million borrowers, including those whose balances have grown from accrued interest and have been in repayment for years. In response, Mitria Spotser, vice president and federal policy director at the Center for Responsible Lending (CRL), made the following statement: For years, CRL has advocated for the elimination of accrued interest that prevents millions of low-income borrowers from repaying their loans and breaking free from a cycle of

CFPB Should Strengthen Consumer Protections in its Proposed Overdraft Rule

WASHINGTON, D.C. – The Center for Responsible Lending (CRL) in a comment letter urged the Consumer Financial Protection Bureau (CFPB) to bolster its proposed overdraft rule with more measures to prevent very large banks and credit unions from evading the intent behind the rule. The CFPB estimates that, once finalized, its rule could save the 23 million households who pay overdraft fees an average of $150 each year – while the hardest-hit households could save much more. “High-cost overdraft fees are junk fees paid most often by the least financially secure bank customers. The CFPB’s proposed

New VA Program to Provide Home Loan Assistance to Active-Duty Servicemembers and Veterans

Advocates Praise Program and Call for Foreclosure Pause Until It is Fully Implemented WASHINGTON – Today, the U.S. Department of Veterans Affairs released its VA Servicing Purchase (VASP) program to help VA borrowers facing financial hardships avoid unnecessary foreclosures. Through VASP, the agency will modify and purchase qualifying loans in default to provide meaningful payment assistance to VA borrowers in financial distress. Consumer advocates at the National Consumer Law Center (NCLC) and the Center for Responsible Lending (CRL) expressed support for the new program and urged the VA to

CRL Applauds New Biden-Harris Administration Plan to Deliver Student Debt Relief to Millions of Americans

Washington, D.C., — The Biden administration announced today a new set of plans that would provide student debt relief to more than 30 million borrowers. If enacted, the proposals would waive accrued and capitalized interest— unpaid interest that is added to the principal of the loan— for millions of low-income borrowers, and up to $20,000 in unpaid interest for other impacted borrowers. The proposals would also make a new group of borrowers eligible for forgiveness without requiring their enrollment in the Saving on a Valuable Education (SAVE) program. In response, Nadine Chabrier, senior

New CRL Report Reveals Large Hidden Costs of Earned Wage Advance Apps

Consumers experienced a 56% increase in checking account overdrafts after using an advance product WASHINGTON, D.C. – Today, the Center for Responsible Lending (CRL) released a report with new data showing that consumers who took out small loans using cash advance apps paid triple-digit annual interest rates, experienced high levels of repeat reborrowing, and incurred more bank overdraft fees after starting to use the product. The report, titled “Not Free: The Large Hidden Costs of Small-Dollar Loans Made Through Cash Advance Apps,” analyzes the transactions associated with five companies –

Fintech Industry and Maryland Legislative Allies Hijack Regulatory Bill, Abandon Long-Held Consumer Financial Protections, Allow the Return of Abusive Payday Lending

Washington, DC – After decades of protecting borrowers from high-cost, payday lenders, Maryland lawmakers are poised to eliminate longstanding consumer protections in a bill that lets nonbank earned wage advance (EWA) lenders create an industry-defined financial category that allows them to charge triple-digit interest rates and unlimited junk fees on payday-style loans to hardworking consumers. There is ample evidence, including new research released today, showing that using fintech loan apps can lead low wage, low wealth borrowers to even greater financial distress, including an increase in

Banking Industry’s Lawsuit to Halt Updated CRA Regulation is Part of Growing Movement by US Businesses to Use the Extremist Courts to Disrupt Needed Rules

Washington, DC -- Bank and business trade groups recently were granted a preliminary injunction by a federal court in their ongoing lawsuit to block the Federal Reserve, Federal Deposit Insurance Corporation and Office of Comptroller of the Currency from implementing updates to the Community Reinvestment Act (CRA) that require big banks to lend to their entire community, particularly low-income and minority residents. The Center for Responsible Lending issued the following statement: “The court should reject this transparent attempt to use the legal system to disrupt the rulemaking process and

CRL Statement in Response to President Biden’s Proposal to Eliminate Junk Fees in Higher Education

Washington, D.C., — The Biden administration announced today a series of proposals to improve our nation’s higher education system. These initiatives include eliminating origination fees for federal student loans and eliminating other fees that would make college education more affordable. In response, Jaylon Herbin, director of federal campaigns at the Center for Responsible Lending (CRL), made the following statement: We applaud the administration’s commitment to eliminating unnecessary junk fees in higher education and contributing to a fairer, more equitable student loan repayment system

CRL Expresses Appreciation for Work of Retiring HUD Secretary Marcia Fudge

Washington, DC -- Marcia Fudge has announced that she will step down next Friday as the 18 th Secretary of Housing and Urban Development, where she was a champion of policies to promote safe, equitable and affordable housing. Mike Calhoun, president of the Center for Responsible Lending, made the following statement: During her tenure at HUD, Marcia Fudge fought to ensure that FHA mortgages remained a viable entry point to homeownership for first-time buyers, people of color and individuals with lower incomes. Her efforts reduced costs of mortgage insurance on FHA loans, and ensured that the