Consumer Groups Call on the 7th Circuit to Uphold Fair Lending Law

CHICAGO – Tomorrow morning, the Seventh Circuit Court of Appeals will hear oral arguments in the appeal of a fair lending enforcement action brought by the Consumer Financial Protection Bureau (CFPB) against Chicago mortgage lender Townstone Financial. The appealed decision upends 50 years of fair lending law, concluding that lenders are free to discourage minority consumers from seeking credit without violating the Equal Credit Opportunity Act. This errant decision is not only wrong - it endangers equitable access to participation in our economy and legalizes discrimination. Ahead of oral

House Passes Bill to Prevent Transparency in Small Business Lending

WASHINGTON, D.C. – The U.S. House today passed a resolution, S.J.Res. 32, under the Congressional Review Act (CRA) to repeal the Consumer Financial Protection Bureau’s (CFPB) Section 1071 rule of the Dodd-Frank Act, which requires financial institutions to collect and report data on credit applications to the Bureau and the public. President Biden has indicated that he would veto the CRA bill if sent to him for signature. S.J.Res. 32 passed the U.S. Senate in October. Mitria Spotser, vice president and federal policy director at the Center for Responsible Lending (CRL) made the following

California Should Not Delay Protections for Fintech Cash Advances

Earned Wage Advances Should Comply with State Interest Rate Limits Now, Not in Four Years SACRAMENTO – The California Department of Financial Protection and Innovation (DFPI) should restore cost limits for earned wage advances and other fintech cash advances under proposed regulations rather than allow a temporary registration regime with no cost limits for up to four years, the Center for Responsible Lending, Consumer Federation of California, National Consumer Law Center, and Office of Kat Taylor said in comments filed late yesterday. “The DFPI has seen through industry myths and recognizes

VA Foreclosure Pause Will Prevent Thousands of Veteran Foreclosures

WASHINGTON – Late Friday, the U.S. Department of Veterans Affairs called on mortgage servicers to pause foreclosures until May 31, 2024 . This pause will give VA borrowers a much-needed opportunity to access the upcoming VA Servicing Purchase (VASP) program. 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), along with U.S. Senators Jon Tester (Mont.), Sherrod Brown (Ohio), Jack

CRL Applauds CFPB for Holding Citibank Accountable for Lending Discrimination

WASHINGTON - The Consumer Financial Protection Bureau (CFPB) this week assessed more than $25 million in redress and penalties against Citibank, N.A., the third-largest bank in the U.S., for illegal discrimination. The CFPB found that Citi, with assets of more than $1.7 trillion as of June 2023, purposefully discriminated against credit card applicants of Armenian descent, primarily based on the spelling of their last name, and fabricated documents to cover up its discrimination. Mike Calhoun, president of the Center for Responsible Lending, issued the following statement: CFPB plays a

At Congressional Hearing, CRL Testifies That Fintech Lending Bills Under Consideration Would Harm Consumers

Newly published reports on earned wage advances and buy now pay later support the warnings WASHINGTON, D.C. – Congress should do more to protect consumers from abuse by so-called “fintech” lenders and, at minimum, should not enable that abuse through legislation, the Center for Responsible Lending (CRL) said yesterday in testimony at a Congressional subcommittee hearing . That message was reinforced by letters from a coalition of advocates warning that bills, considered as part of the hearing, would further expose consumers to harm. The fintech-focused hearing was entitled “Modernizing

New Report Highlights Consumer Risks and Regulatory Gaps in "Buy Now, Pay Later" Services

WASHINGTON, DC - A recent report published by the Consumer Federation of America and the Center for Responsible Lending provides an in-depth analysis of the "Buy Now, Pay Later" (BNPL) industry, revealing substantial misunderstandings among consumers and a critical absence of regulatory oversight on a national scale. “BNPL lenders are making it easier for borrowers to use high-cost loans for everyday purchases,” said Peter Smith, a Senior Researcher at the Center for Responsible Lending . “At the same time, they are trying mightily to hide the true costs and risks of these loans.” Key findings

Updates of Community Reinvestment Act Will Create a More Inclusive Financial System

WASHINGTON, DC – Federal banking regulators today passed updates to the Community Reinvestment Act (CRA), one of the seminal pieces of legislation to address systemic inequities in access to credit. The Comptroller of the Currency, Federal Reserve System and Federal Deposit Insurance System made the revisions to increase transparency and bring the regulatory system in-line with modern banking practices, including the rising use of mobile and online banking and lending. “All Americans deserve an inclusive financial system that helps them realize their dreams,” said Mitria Spotser, vice

CRL Commends Biden-Harris Administration for Strengthening Consumer Protections for Students

WASHINGTON, DC – The Biden-Harris Administration today announced final regulations that will enhance oversight and accountability for higher education institutions and strengthen protections for student borrowers. The new rules will go into effect July 1, 2024. In response, Jaylon Herbin, director of federal campaigns at the Center for Responsible Lending (CRL) made the following statement : We commend the Biden-Harris Administration for protecting students and taxpayers by enhancing transparency and accountability in higher education. These new rules not only address the disruptions caused by

CRL, AFR, and NCRC Blast Senate Democrats For Betraying Small Business Owners With Vote To Rescind Section 1071

Five Democratic Senators betrayed small business owners Wednesday by voting with Republicans to rescind recently finalized small business lending data rules known as Section 1071, leading consumer advocacy groups said. From Center for Responsible Lending (CRL) President Mike Calhoun: “We strongly oppose the Senate’s CRA bill and urge the House to support the small businesses that power the nation’s economy, including minority and women-owned businesses. We also urge President Biden to veto the CRA bill if it reaches his desk. A robust 1071 rule is crucial. It will spur entrepreneurship in