Testimony

Committee: U.S. House Committee on Financial Services Subcommittee on Financial Institutions and Consumer Credit

Too often in the recent past, discussions over consumer protection regulation have been portrayed as a zero-sum game, where consumer protections are assumed to be a drag on the market, and must come at the expense of business. But that is a false dichotomy. Businesses have a symbiotic relationship with their customers. In the end, the health of the business community – indeed, the health of the economy as a whole – depends upon the financial health of America's households. Practices which undermine the financial health of households in the long run undermine the health of the businesses that...

In this testimony, we first discuss why we support eliminating what is functionally discrimination in the law against the FTC in its rule-making authority, compared to other agencies. Section I. We also support the Congressional guidance to the FTC to use the APA rule-making in the area of consumer credit and debt, which we recognize to be central to the health of the economy as a whole. We first put that priority into context, with a general picture of the financial health of the majority of America's households. Section II. Turning to the specific areas identified in the bill, Section III...

Download Paul Leonard's Presentation >> Committee: California State Assembly Banking and Finance Committee

We suggest a broad, simple framework that addresses the entire mortgage market and that focuses on the underlying incentives in that market. The legislation should establish a bright-line ban on dangerous loan features such as prepayment penalties and "no-doc" loans as well as on market-distorting incentives such as yieldspread premiums. All mortgage origination should be subject to rules that discourage originators from placing people in mortgages that are more expensive than those for which they qualify or that they cannot afford to sustain. Most important, all participants in the mortgage...

The Administration's Making Home Affordable Program represents a significant step forward, one that is essential and long overdue. It includes concrete and pragmatic measures to counter the perverse incentives that severed the interests of servicers from those of the borrowers and investors, and led servicers to pursue foreclosure even where the homeowner could afford a loan modification that would produce greater returns for investors as a whole. The program recognizes that, without government action, relying on servicers and investors to voluntarily modify troubled loans does not work. The...

Congress has an opportunity to prevent another mortgage fiasco by passing stronger protections on home lending. Americans are clear about wanting more accountability throughout the lending chain: Two-thirds of voters surveyed said Wall Street should be accountable for buying loans that put borrowers at serious risk of foreclosure. And 84% believe mortgage brokers should have a legal responsibility to act in the best interest of their clients, just like investment advisers do today. To find out more about the potential for new lending protections, read our recent testimony before the House...

Testimony of Keith S. Ernst, Center for Responsible Lending Before the Joint Economic Committee of the U.S. Congress In testimony before the Joint Economic Committee, Director of Research Keith Ernst testified that foreclosures continue to soar and the mortgage market continues to suffer. He also presented testimony showing that risky loans, not risky borrowers, lie at the heart of the mortgage meltdown. He recommended several key actions to mitigate the continued flood of foreclosures and avert similar crises in the future: Create a Consumer Financial Protection Agency as outlined in H.R...

Eric Halperin, director of CRL's DC office, submitted testimony to the Financial Services Committee of the U.S. House on H.R. 3904, the Overdraft Protection Act of 2009. He called the Act a crucial measure for protecting consumers from abusive bank overdraft fees, which have reached $23.7 billion per year. The Federal Reserve Board has failed to address the problem, and reform is urgently needed. http://www.house.gov/apps/list/hearing/financialsvcs_dem/hr_102309.shtml