Research & Policy

The Center for American Progress, Center for Responsible Lending, Consumer Federation of America and the National Council of LaRaza respond to the Consumer Financial Protection Bureau proposal on the Ability to Repay Standards. The allies offered specific practices to ensure affordable access to mortgage credit. Two specific issues formed the crux of their concerns: How mortgage lending compensation is defined and preserving lending programs that offer a gateway to safe and affordable credit. The mortgage compensation concerns heavily focus on yield spread premiums (YSPs).

A recent CoreLogic report ( The Mortgage Market Impact of Qualified Mortgage Regulation) asserts that 48 percent of the mortgage market would not qualify as a "safe loan" under new Qualified Mortgage (QM) guidelines. CRL's review of this study finds that CoreLogic's model unnecessarily excludes certain categories of loans and makes broad (and possibly unwarranted) assumptions about the expiration of the GSE exemption for QM loans.

This is CRL's comment to the CFPB in response to the Consumer Financial Protection Bureau's Request for Information Regarding Credit Card Market. In this response, CRL argues that the Credit CARD Act of 2009 has made pricing clearer without restricting credit, raising its cost or curbing the ability of card issuers to price for risk. Contrary to curbing risk-based pricing, the CARD Act encourages risk-based pricing.

Payday Loans Create a Debt Trap. For California families living paycheck to paycheck, the high price of a payday loan and the fact that it must be paid off in one lump sum two short weeks later virtually ensures that cash-strapped borrowers will be unable to meet their basic expenses and pay off their loan with their next paycheck. Consequently, too many Californians are forced to pay off one loan and immediately take out a new loan, repeating the cycle over and over. Although payday loans are marketed and publicly rationalized as a short-term loan for an occasional, unexpected expense...

The Dodd?Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) includes a common sense reform that requires lenders to determine whether borrowers could actually repay a mortgage before that transaction takes place. The law also includes a streamlined way to meet this new requirement, which is making loans that meet a "Qualified Mortgage" standard. QM loans also have benefits for borrowers, because QMs are restricted from having harmful loan terms such as balloon payments, teaser rates and high fees. Dodd-Frank charged the CFPB with writing rules to define which loans qualify as QM...

Credit cards are one of the most common purchasing tools used by Americans, and total U.S. credit card debt has increased $172 billion since 2000. This doesn't mean Americans are living beyond their means--a recent study found that many low- and middle-income households rely on credit cards to pay for basic living costs or weather medical expenses and unemployment. In the past, credit card companies took advantage of this reliance on credit cards by engaging in unfair and deceptive practices. This chapter illustrates some of these abusive practices, and describes how the Credit CARD Act of...

Car dealerships often markup auto loans by steering buyers into a higher interest rate loan than they qualify for. Don't let this happen to you. Find out how much extra interest may be in your next car loan with this calculator.

Despite the worst housing crisis since the Great Depression, owning a home is still central to the hopes and aspirations of many Americans. Even with the recent decline in house prices, owning a home can bestow more financial and non-financial benefits than any other single asset. This means more economic mobility and financial security for families, and stronger communities too. As this chapter explains, the shift away from standard mortgage loans and strong underwriting during the 1990s and early 2000s, along with a fractured regulatory environment, sparked the foreclosure crisis and...

Automobiles are one of the largest purchases most American households will make. Car ownership affects where people can live and expands their options for jobs. So the affordability and sustainability of auto financing can have a big impact on many U.S. households. Purchasing a car is a complicated endeavor, and the sales price, trade-in value, and financing can all have a big impact on the vehicle's overall cost. In this chapter, CRL describes how the lack of transparency and regulation in auto finance has allowed predatory practices to thrive. Read Our Auto Loans Chapter Previous Chapter...

Ever since the financial crisis started, the Blame Game has been a popular pastime. In this infographic, we highlight players who often get more than their share of pointing fingers. To embed our infographic to your site, simply just cut and paste the code below

Student loans can help you pay for college, but they're not all alike. This infographic shows the different features of federal vs. private loans. Read the Chapter To embed our infographic to your site, simply cut and paste the code below

This chapter in the State of Lending report series presents a picture of the overall financial status of U.S. consumers today. It is based on data from the Consumer Expenditure survey, the Survey of Consumer Finances, and other national data sources. These sources reveal that, since 2000, American families have faced declining real incomes,a higher cost of living, greater debt levels, and declining asset values and wealth. Rebuilding the tenuous balance sheets of American households will require access to safe and affordable credit, along with strong protections to prevent predatory lending...

CRL Senior Researcher Sonia Garrison covers the key findings of the "Student Loans" chapter in State of Lending.

Prepaid cards can be useful, but they carry risks as well. Use these tips to help determine the best prepaid card for you. To embed our infographic to your site, simply cut and paste the code below

Nationwide, foreclosures have drained nearly $2 trillion in property value from families who live nearby, more than half of them African-American or Latino.* This loss in wealth has hit some areas of the country harder than others. Here we break down the spillover costs for each state, showing total lost wealth, number of households affected and average home equity lost. *Results apply to loans that entered foreclosure between 2007 through 2011. For more details on this report, see " Collateral Damage: The Spillover Costs of Foreclosures."

This chapter in the State of Lending report series describes the overall financial status of U.S. households today--their income, spending, debts, and wealth. It tells the story of financial challenges that consumers have faced in the past decade, and how these have made Americans more vulnerable to predatory lending. It also describes how household financial health is central to our nation's economic well-being. Read the Chapter Previous Chapter Next Chapter Overview [Video] CRL Research Director M William Sermons covers the key findings of the "America's Household Balance Sheet" chapter of...

Purchasing a car is a complicated endeavor, and the sales price, trade-in value, and financing are all separate and negotiable transactions. This chapter outlines how car dealers have become increasingly reliant on revenues from vehicle financing and insurance, yet those transactions are not transparent and are weakly regulated. As a result, predatory practices have created more expensive and unsustainable loans for consumers. The primary abuses highlighted this chapter include dealer interest rate markups, "yo-yo" scams, and loan packing (via add-on products like insurance), as well as...

Figuring out how to pay for college can be difficult. In this video, Andrea Harris (President of the NC Institute of Minority Economic Development) discusses three important things that parents and students should remember when looking for financial aid or student loans.

In the U.S. today, total student loan debt exceeds $1 trillion and nearly one in five households has a student loan. This chapter discusses factors leading to the growth in student loan debt and highlights important differences between federal and more costly private student loans. The chapter also shows the spike in student loan defaults and highlights the role of for-profit colleges in this increase. Read this chapter below or download the full report.

CRL Senior Research Debbie Bocian covers the key findings in the "Mortgages" chapter of State of Lending. </p>

During the car buying process, you may spend hours researching prices, but make sure the vehicle financing is a good deal, too! Use this infographic to understand your auto loan options. To embed our infographic to your site, simply cut and paste the code below

State of Lending outlines predatory lending practices in various fields of consumer lending, and explains why protecting fair, affordable access to credit is vital for both consumers and the U.S. economy. It also describes the regulatory and legislative actions needed to halt the predatory lending practices that exist today and prevent the rise of new abuses. Read the Foreword Return to Index Next Chapter

This infographic shows the changes in the use of plastic payments, including credit cards, debit cards, and prepaid cards. To embed our infographic to your site, simply just cut and paste the code below