Research & Policy

Buy Now, Pay Later (BNPL) or pay-in-four products allow consumers to purchase goods in four equal, often interest-free installments over a set time period (often 6 weeks). BNPL is often available directly at checkout on an e-commerce website (like Amazon or Apple) or through a third-party smartphone or web application. Examples of third-party BNPL providers include Affirm, AfterPay, Klarna, Splitit...

In a letter to the House of Representatives' Financial Services Committee, consumer advocates warn that the Financial Services Innovation Act of 2023 would facilitate evasion of existing consumer protection laws and regulations. Citing the foreclosure crisis around 2008 and other examples, the letter states: "Blind endorsement of 'innovations' leads to consumer harms." The bill, currently a discussion draft, was considered...

In a letter to the author of the Earned Wage Access Consumer Protection Act, advocates warn: "In the guise of offering protections, the bill obscures its true effect: to exempt fintech cash advances from the Truth in Lending Act, to endorse a form of loan that makes workers pay to be paid, and to facilitate new evasions by payday lenders."...

States are grappling with how to regulate earned wage advances (EWAs) and other fintech cash advances that purport not to be credit. These loans often closely resemble payday loans, with fees that multiply into rates above 300% and cycles of reborrowing that result in workers paying to be paid. State legislatures and regulators should not adopt industry-backed approaches, like those...

Many people involved in the criminal legal system live on the economic margins. Most defendants are unable to hire their own lawyer due to indigency. In North Carolina, the average person in prison doesn’t have a high school diploma. The cost of involvement in the criminal legal system can quickly add up to thousands of dollars, but the people expected...

New data from the bipartisan polling team Lake Research Partners and Chesapeake Beach Consulting shows that voters across the political spectrum overwhelmingly support the ongoing mission of the Consumer Financial Protection Bureau (CFPB) to regulate the financial industry and protect consumers. The survey also revealed strong support for maintaining the secure, independent funding mechanism for the CFPB. These new findings...

In September, the Supreme Court heard oral arguments for a lawsuit that could abruptly and permanently close the Consumer Financial Protection Bureau – which would not only harm consumers and businesses but would also cause economic chaos.

The income-driven repayment plan prevents unpaid interest from increasing a borrower’s loan balance, and ensures remaining balances are forgiven after a certain number of years.

Consumers are increasingly accessing small short-term loans through digital cash advance and Earned Wage Advance (EWA) online applications. Consumers can receive advance amounts up to $750 per pay period while using these apps. Some companies contract with employers to provide this product while others work directly with consumers. In the direct-to-consumer model, the advances are often marketed as “free,” but...

The NAACP Legal Defense and Educational Fund, Inc. (LDF) and the Center for Responsible Lending (CRL) submitted a comment in response to the federal financial regulators’ proposed rulemaking on Quality Control Standards for Automated Valuation Study after study has found ongoing, significant undervaluation of homes in communities of color and owned by people of color. Due to decades of past...

CRL submitted a comment on the Federal Housing Finance Agency’s Single Family Pricing Framework arguing that the FHFA should take three steps: Revisit and revise the Enterprise Regulatory Capital Framework, which currently imposes excessive capital requirements on the GSEs; Continue the forward momentum of its recent elimination of LLPA’s for first-time homebuyers and certain affordable housing products by expanding its...

The undersigned organizations wrote in strong support of the Bureau’s proposed rule applying Regulation Z to Residential Property Assessed Clean Energy (PACE) loans. In the proposed rule, the Bureau correctly recognizes that PACE financing fundamentally acts as mortgage credit, yet is provided by underregulated or unsupervised entities that often exploit the lien priority granted to tax assessments. As a result...

With nearly 45 million Americans owing 1.7 trillion dollars in student loan debt, the Department’s intent to establish a negotiated rulemaking committee to examine proposals under the waiver, modification, and compromise authority is critical to increasing fairness and affordability for those who must accrue debt to pursue higher education. The sheer scale of the student loan debt crisis in America—and...

The Consumer Financial Protection Bureau (CFPB) issued a Policy Statement on Abusive Acts and Practices and invited comments from the public. The Center for Responsible Lending applauds the CFPB for its efforts to further clarify abusive acts and practices. The Center further offers insights into how the statement may be strengthened to clarify the ways these acts take unreasonable advantage...

This factsheet outlines how H.R. 3564, which would reverse recent FHFA updates to mortgage pricing, would leave borrowers and taxpayers less financially secure.

Millions of Americans continue to experience financial precarity, and this report illustrates how payday and car-title lending extract financial resources from communities across the United States.

Payday lenders charge exorbitant fees to borrowers without assessing their ability to repay, and the annual interest rates on these loans are in the triple digits.

From the letter: We strongly believe many of the reforms being considered today will harm consumers and the financial markets. These misguided approaches will place every American taxpayer at risk by increasing the likelihood that our nation’s economy may suffer yet another financial crisis. There are two proposals that are especially concerning. The first increases the asset thresholds at which...

From the letter: We strongly believe many of the reforms being considered today will harm consumers and the financial markets. These misguided approaches will place every American taxpayer at risk by increasing the likelihood that our nation’s economy may suffer yet another financial crisis. There are two proposals that are especially concerning. The first increases the asset thresholds at which...

Today, more than 44 million Americans are crushed under the weight of $1.7 trillion in student loan debt. This debt prevents borrowers – in red states and blue states, urban and rural communities – from fully participating in the American economy. It delays or denies borrowers the opportunity to buy a home, start a business, or invest in retirement, thereby...

This CRL letter to Congress expresses support for the Federal Housing Finance Agency (FHFA) updates to its mortgage pricing framework, including FHFA’s assessment on lenders of fees known as Loan Level Pricing Adjustments (LLPAs). The letter also urges Congress to reject H.R. 3564, the so-called Middle-Class Borrower Protection Act, a bill that would rescind FHFA’s recent updates.

The Center for Responsible Lending (CRL) and the National Consumer Law Center (NCLC) expressed support for the Department of Financial Protection and Innovation’s (DFPI) proposal to clarify that fintech cash advances are covered by the California Financing Law (CFL), including its fee and interest rate limits. The proposal requires that lenders be licensed under the CFL, with a temporary licensing...

The undersigned organizations commend the Department of Financial Protection and Innovation (DFPI) for moving to regulate abusive fintech lenders, including earned wage advance providers. We are very pleased to support the proposed rules and encourage the DFPI to vigorously enforce them to ensure that California’s most vulnerable consumers are not harmed. Signatories California Employment Lawyers Association (CELA) CA Labor Federation...

The CFPB plays an integral role in the nation’s financial system. The Bureau’s work ensures that the system functions in a manner that is responsive to the interests of all market participants—consumers, large financial entities, and smaller institutions like Amici. Congress’s chosen method of funding the Bureau underpins the Bureau’s ability to do this important work, free from the outsized...

The 261 organizations representing millions of students, workers, people of color, veterans, people with disabilities, consumers, and people of faith write in strong opposition to bicameral efforts to use the Congressional Review Act (CRA) to overturn President Biden's actions to pause student loan payments and provide student debt relief for low-income and working-class Americans continuing to recover from the deadly...