Research & Policy

While most homeowners with GSE-backed mortgages have recovered from pandemic-related hardships and reinstated their mortgage, as of June 7, about 1.6% of outstanding GSE borrowers were in a state of nonpayment: about 140,000 GSE-backed loans were in COVID-19 Forbearance, and another roughly 300,000 loans were delinquent outside of forbearance. For those GSE borrowers who were less than 2 months delinquent as of the onset of the pandemic who cannot resume their originally scheduled monthly payments due to ongoing pandemic-related financial hardship, the GSEs offer the COVID-19 Flex Modification...

From the introduction to the comment : Accountable.US, Americans for Financial Reform, Center for Responsible Lending, Consumer Action, Consumer Federation of America, National Consumer Law Center (on behalf of its low income clients), Public Citizen, US PIRG and the Woodstock Institute submit these comments in connection with the Community Reinvestment Act (CRA) examination of Transportation Alliance Bank (dba TAB Bank). TAB Bank serves as a rent-a-bank, nominally originating predatory loans at rates up to 189% APR for Duvera Billing Services, dba EasyPay Finance, to help EasyPay evade state...

On June 29, 2022, Mike Calhoun, CRL's president, testified before the House Committee on Financial Services for a hearing entitle, “Boom and Bust: Inequality, Homeownership, and the Long-Term Impacts of the Hot Housing Market.” His written testimony is available for download. Watch a recording of the hearing:

Women carry about two-thirds of the $1.7 trillion of federal student debt, with Black women more than twice as likely as white men to owe more than $50,000 in undergraduate student loan debt. Women carry about two-thirds of the $1.7 trillion of federal student debt, with Black women more than twice as likely as white men to owe more than $50,000 in undergraduate student loan debt. The COVID-19 crisis has exacerbated the financially unstable positions of many women, furthering gender disparities. The Center for Responsible Lending (CRL) commissioned four focus groups with women who voluntarily...

From the introduction to the letter : The undersigned civil rights, student, community, and consumer advocacy organizations, along with faith leaders from across the country, urge you to use the authority of executive action to cancel $50,000 of federal student loan debt per borrower to stimulate the economy, bridge the racial wealth gap, and alleviate the financial suffering of millions of Americans, including Black women. While women carry around two-thirds of student debt, Black women are more than twice as likely as white men to owe more than $50,000 in undergraduate student loan debt.

NALCAB, the National Association for Latino Community Asset Builders, The National Coalition for Asian Pacific American Community Development (CAPACD), and the Center for Responsible Lending (CRL) write in response to the invitation for public comments regarding changes made to the Community Advantage Pilot Program (CA) noticed in the Federal Register on April 29th, 2022. Access to capital is one of the greatest barriers to success for minority entrepreneurs. Since its inception in 2011 CA has successfully expanded access to capital for small businesses located in underserved communities...

A broad coalition of 529 community, civil rights, education, climate, health, consumer, labor, professional, food and farm, and student advocacy organizations wrote a letter to President Biden urging him to strengthen the economy, tackle racial disparities, and provide much-needed relief to help all Americans weather the pandemic and record inflation by using executive authority to cancel federal student debt immediately . Read the full letter.

The Center for Responsible Lending (CRL) recently hosted a panel discussion to examine the student debt experience of students who attend or who have graduated from Historically Black Colleges and Universities (HBCUs). The group put faces to data as they discuss student debt cancellation and its potential impacts, particularly on people of color. Serving as moderator was Jaylon Herbin, CRL Policy and Outreach Manager and Student Loan Lead. Participants included: Wisdom Cole, NAACP National Director, Youth in College Division; A’Kira Thomas, a third year law student (3L) at NCCU School of Law...

A coalition of consumer advocacy groups sent letters to major national auto repair chains AAMCO and Precision Tune Auto Care (Icahn Enterprises), Big O Tires and Midas (TBC Corporation), Grease Monkey (FullSpeed Automotive), JiffyLube, and Meineke (Driven Brands) urging their stores and franchisees to stop offering financing through EasyPay Finance and Utah-based TAB Bank, which issue loans at rates up to 189%, even in states where that rate is illegal.

The student debt crisis has been building for decades, and millions of families have seen their dreams derailed by unaffordable debt repayment burdens that block their path to financial stability. As college costs rose, students had to take on increasing amounts of debt to pay for higher education. At the same time, state student financial aid offerings were drastically reduced, forcing students and families into long term debt that often grew to be unaffordable over time. Due to longstanding discrimination, students and families of color have less personal, family, and intergenerational...

Next to owning a home, business equity is the largest source of wealth in the United States. Small businesses are the backbone of the American economy, providing almost half of all jobs in the U.S. and creating nearly two-thirds of all new jobs. Yet barriers to credit access prevent Americans from starting businesses and building generational wealth, further widening the racial wealth gap. Congress and federal agencies are charged with enforcing fair lending laws and ensuring equitable access to capital, but don’t have the data they need to answer basic questions about small business lending...

Today, the Student Borrower Protection Center (SBPC), National Consumer Law Center (NCLC), Student Debt Crisis Center (SDCC), and Center for Responsible Lending (CRL) sent a letter to the largest trade organizations representing student loan lenders and servicers underscoring their legal obligation to faithfully implement the U.S. Department of Education’s (ED) recent fix for income-driven repayment (IDR) .

The Center for Responsible Lending (CRL), along with Americans for Financial Reform (AFR), Consumer Federation of America (CFA), the National Community Reinvestment Coalition (NCRC), and National Consumer Law Center (NCLC) (on behalf of its low-income clients) submitted a comment letter to the Consumer Financial Protection Bureau (CFPB) in response to their call for public input on how to save Americans billions in junk fees charged by financial companies, leading consumer advocacy organizations submitted an extensive comment letter detailing junk fees across a wide range of consumer financial...

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Many FHA borrowers took advantage of record-low interest rates during the COVI9-19 pandemic and refinanced their mortgage. However, as of November 2021, there were over 4 million FHA borrowers who could realize a substantial reduction in their monthly payments by refinancing but had not done so. The average borrower in this cohort would save $229 per month ($2,750 per year) by refinancing their mortgage. Low-to-moderate income (LMI), Black, and Hispanic households had slower refinancing rates compared to higher income, White, and Asian households during the pandemic-induced refinancing wave...

Two vital elements of social and economic mobility are to increase the homeownership rate by enabling more non-homeowners to become first-time homebuyers and reduce the racial disparities in homeownership rates caused in large part by deliberate discriminatory policies and practices. The Government Sponsored Enterprises (GSEs) have the ability to improve both through their affordable housing goals and lending programs. The National Fair Housing Alliance (NFHA) and Center for Responsible Lending (CRL) believe that the Federal Housing Finance Agency (FHFA) should expand the eligibility of the...

The exploding market of Buy Now Pay Later (BNPL) credit demands the same level of oversight that we give to credit cards. BNPL can help some borrowers spread out their payments, but entails real risks and costs, which is not clear in advertisements highlighting interest-free payments and “no impact” on credit scores. Regulation is necessary to protect consumers from hidden harms and costs to promote true financial inclusion. Online and in-store retailers now commonly offer BNPL plans, which allow consumers to make purchases in installments, typically four payments over six weeks. Lenders...

The undersigned civil rights organizations do not believe the mandatory July 1 compliance date extension for the General QM Final Rule until October 1, 2022 is necessary since the new General QM definition and the Patch overlap so thoroughly. Please download the letter to continue reading.

A broad coalition of bank and credit union associations and consumer organizations submitted a letter to the U.S. House Committee on Financial Services urging passage of the bipartisan Close the ILC Loophole Act . The bill would help prevent more companies from running what is essentially a bank without the necessary regulatory oversight.

“Income-share agreements,” or ISAs, fund a portion of educational costs in exchange for a percentage of a student’s earnings over time. Many ISA providers continue to argue that their products are not loans even though they lend money and subsequently require repayment, employing an old and predatory tactic that loan providers use to evade consumer protection guardrails. In fact, ISAs are simply high-cost loans that currently lack even the protections afforded to private student loans, which themselves are a worse option than federal student loans for most borrowers. The high cost of ISAs...

In response to the Request for Comments issued by the Consumer Financial Protection Bureau, the Center for Responsible Lending, the Consumer Federation of America, and the National Consumer Law Center (on behalf of its low-income clients) offer joint recommendations for further guidance and monitoring of the growing Buy-Now-Pay-Later market overall, which are specific to the "pay-in-four" model. Our comment covers substantial background of the BNPL market; considerations based on current consumer protection laws, and concerns we hope the Bureau, within its authority, will address.

The group letter begins: The undersigned 77 consumer, housing, civil rights, legal services, faith, community, small business, student borrower, and public interest organizations appreciate the opportunity to comment on the CFPB’s inquiry into Buy Now, Pay Later (BNPL) credit products that are proliferating across market areas. We welcome the CFPB’s recent inquiry into Affirm, Afterpay, Klarna, PayPal, and Zip, however we remain alarmed by the lack of regulation of this exploding consumer credit product market. We urge the CFPB to view BNPL products as credit cards covered by the Truth in...

On March 21, 2022, CRL submitted written testimony to the U.S. House of Representatives Committee on Small Business Subcommittee on Oversight, Investigations, and Regulations for the hearing, “ An Empirical Review of the Paycheck Protection Program .”

Payday lenders often describe the cost of their loans in terms of fees or simple interest rates. Responsible lenders readily disclose the APR on their loans, aligned with the Truth in Lending Act (TILA). They are not afraid to let their customers compare the costs of their loans to other loans in the market. Tellingly, payday lenders often object to having to disclose the APR of their loans. Why APR Matters Payday lenders do not like disclosing APR for two reasons. One, it allows a true comparison of the cost with other forms of credit, even those that are short-term like a credit card advance...

The Center for Responsible Lending, Legal Aid of North Carolina, North Carolina Justice Center, National Association of Consumer Advocates, Charlotte Center for Legal Advocacy, Financial Protection Law Center and Pisgah Legal Services partnered to filed this amicus brief in the North Carolina Supreme Court in Townes v. Portfolio Recovery Associates (PRA). Townes v. PRA is principally about the interpretation of CEPA, NC’s consumer protection statute, and its requirement that debt buyers to produce “itemized accounting” of alleged debts. Plaintiff Ms. Townes is advocating for a bare minimum...