Research & Policy

The Center for Responsible Lending submits this comment to provide additional context about the consumer installment loan market, in particular to highlight issues unaddressed by the proposed settlement with One Main and Springleaf. In this letter, the undersigned organizations bring to your attention three areas of concern that the settlement did not address, but which have a significant impact on...

The 40 undersigned organizations oppose inclusion in any criminal justice reform package of "mens rea" (state of mind) provisions that would make it harder for prosecutors to criminally prosecute companies and corporate executives that engage in criminal wrongdoing. Specifically, there are various mens rea proposals, including mens rea legislation proposed in the Senate, that are premised on the belief that...

On behalf of our millions of members and supporters nationwide, these 45 groups urge the opposition of the so-called "Sunshine for Regulatory Decrees and Settlements Act of 2015" (H.R. 712), which would undermine citizen enforcement of our laws and impede the resolution of consumer protection, anti-discrimination, environmental protection, and other important cases before our federal courts. H.R. 712 targets consent...

More than 250 civil rights, consumer, labor, faith, veterans, seniors, and community organizations, strongly oppose H.R. 4018, the "Consumer Protection and Choice Act." This harmful bill would limit the Consumer Financial Protection Bureau's (CFPB) ability to protect all consumers against high-cost payday, car title, and installment loans. In addition to delaying the Bureau's rule-making for two years or longer, H.R...

Predatory consumer lending is still flourishing in California. Payday lending continues to be pervasive, capturing borrowers who were sold a short‐term loan in a long‐term cycle of debt. But high‐cost debt trap lending has expanded rapidly in the past few years to much larger loans, including some which are secured by and put a borrower’s car at risk. At the...

In Debt Collection Agencies and the Supply of Consumer Credit, Viktar Fedaseyeu examines state-level data to assess the effect of state laws limiting third-party debt collectors on the availability of revolving lines of credit (i.e., credit cards). The debt-buying industry claims that this paper demonstrates that consumers are harmed by these laws and thus regulations should be rolled back, or...

CRL responded to the House Financial Services Committee report on the CFPB and Indirect Auto Lending. We address this response in a letter to House Financial Services Chairman Hensarling and Ranking Member Waters dated and sent on 12/9/15. In the HFSC Report, several assertions are made about indirect auto lending, including arguments opposing CFPB data methodology and an argument that...

We write you to express our concern with pending Senate legislation and recent statements by administration officials in both the U.S. Treasury Department and the White House. Specifically, the Jumpstart GSE Reform Act of 2015, and statements by Secretary Jack Lew, Counselor to Secretary Antonio Weiss, and Mr. Michael Stegman of the National Economic Council opposing greater administrative reforms of...

The organizations represented on this sign-on letter asked President Obama to oppose any appropriations bill that contains inappropriate and ideological policy riders. With the passage of the framework bill for funding the government, has turned to how to allot the monies and what may be attached. Appropriations bills have been used before to undermine essential safeguards through "policy riders" –...

This sign-on letter urges the rejection of any effort to include the "Jumpstart GSE Reform Act" in the omnibus FY 2016 appropriations agreement. While the name and the stated purpose of this bill may sound innocuous, it would effectively hinder rather than advance reform of Fannie Mae and Freddie Mac, increasing the risk of future taxpayer bailouts, and potentially jeopardizing...

Payday loans – whether made online, in stores or by banks – are designed to trap individuals in long-term debt. Data consistently show that the majority of payday loan revenue comes from repeatedly churning borrowers, and that borrowers are typically indebted for most of the year. Recognizing the damaging structure of payday loans and their devastating impact on families' financial...

The undersigned organizations write to urge you to oppose H.R. 1210 (the “Portfolio Lending and Mortgage Access Act”). This bill makes two harmful changes to the Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and its implementing regulations: It takes a special exemption designed for more trustworthy small and rural banks and extends it to all banks, regardless...

A recent Lake Research poll finds strong enthusiasm for new mortgage lending rules that require verification of ability to repay. Voters of all political parties express a strong desire to keep these rules in place. More than nine in ten voters (91%) support requiring mortgage lenders to verify a borrower’s ability to repay before making a loan. Nearly three quarters...

H.R. 1737 hides its intent behind a smokescreen of claims about process and regulatory jurisdiction. However, the bill is really about the unfair and discriminatory impact of car dealer interest rate markups. The bill seemingly targets guidance the CFPB released in March 2013 putting lenders on notice that it had evidence of discrimination in car loans held in lenders’ portfolios...

For the vast majority of car loan borrowers, car dealer interest rate mark ups make their loans unnecessarily more expensive than if a flat fee compensation system were in place. This is the finding of a review of recent industry data by the Center for Responsible Lending. In a recent study, Charles River Associates suggested that if the CFPB required...

This brief analyzes the payday and car title loan market in Ohio, where millions of dollars are drained out of low-income Ohioans' pockets and communities in the form of predatory loan fees. Key findings include: There are 836 storefronts in Ohio that make payday or car title loans, the majority of which (59%) offer both forms of high-cost loans. Payday...

FHA has proposed to shift the obligations for mortgagees to certify that they have upheld all legal requirements from the loan-level certification to the initial and annual lender level certification requirement. In principle, we are not opposed to shifting the placement of these requirements, so long as FHA vigorously enforces these requirements and upholds the need to provide timely annual...

The right loan-level certification requirements will make it possible for consumers to be protected from risky mortgage products, for FHA to operate a safe and sustainable mortgage insurance program, and for lenders to have the clarity and certainty they need about enforcement standards to expand access to FHA-insured mortgage credit.

A new policy brief released today by the Center for Responsible Lending provides a state-by-state snapshot showing predatory payday and car title lenders increasingly moving into installment loans. The lenders are continuing to offer unsafe loans with excessive interest rates, which are carefully designed to trap borrowers in a cycle of debt they cannot escape, and actively seeking to expand...

The 2015 NC General Assembly adjourned yesterday, months after we first expected them to wrap-up their session. They will reconvene for the short session on April 25, 2016. Because of your calls and letters, three very dangerous bills did not pass: Senate Bill 681, which would have legalized 80 to 125% loans, never even got a committee hearing, House Bill...

This comment was filed in response to the Department of the Treasury’s request for information on marketplace lending. Our history of advocacy for fair lending practices, and against unfair ones, is the lens through which we focus these comments, where we emphasize: Online marketplace loans must comply with applicable state law Underwriting for ability-to-repay, based on income and expenses, should...

The 2015 NC General Assembly adjourned yesterday, months after we first expected them to wrap-up their session. They will reconvene for the short session on April 25, 2016. Because of your calls and letters, three very dangerous bills did not pass: Senate Bill 681, which would have legalized 80 to 125% loans, never even got a committee hearing, House Bill...

The 2014 mortgage data submitted by lenders under the Home Mortgage Disclosure Act (HMDA) reflects a slowly recovering mortgage market, but one that troublingly continues to under-serve important market segments. The implementation of federal mortgage underwriting standards (known as Ability-to-Repay or "ATR" and the Qualified Mortgage rule or "QM") in early 2014 did not cause a departure from mortgage lending...

See details below about 2015 NC General Assembly bills: Senate budget bill would repeal State Fair Housing Act Bill to legalize 80 to 125% loans still stalled Bill to roll back debt collection protections also stalled Ratified bill reduces protections against harassing calls Wage garnishment put into study committee bill Bills to reduce protections against mortgage broker abuses have not...

On July 30, 2015, the Center for Responsible Lending joined Higher Ed Not Debt, Consumers Union, Consumer Action, Generation Progress, National Consumer Law Center, Student Debt Crisis, United States Student Association, Veterans for Education Success, and the Woodstock Institute in sending this letter to Debbie Matz, Chairman of the National Credit Union Administration. The letter concerns private student loans to...