Payday and Other Small Dollar Loans

The following provides an overview of Consumer Financial Protection Bureau (CFPB) Director Kathy Kraninger’s proposal to repeal the CFPB’s 2017 rule aimed at stopping the debt trap of payday and car title loans. This document includes the Center for Responsible Lending’s (CRL’s) initial analysis of the purported rationale for the repeal. As we further consider the proposal, our reactions may...

A 30-minute documentary produced by the Center for Responsible Lending, in cooperation with South Dakotans for Responsible Lending Before November 2016, payday and car title lenders in South Dakota charged annual interest rates up to 574%, trapping people in debt and often ruining their financial lives. The state legislature wouldn't pass reform, so South Dakotans put a 36% interest rate...

"The undersigned consumer, community, and civil rights organizations write to urge the Consumer Financial Protection Bureau to reverse its recent decision to suspend the supervision of payday, car title, and other lenders for violations of the Military Lending Act (MLA). We also urge the Department of Defense to ensure that the Military Lending Act is vigorously implemented without exemptions or...

In 2008, the majority of Ohio voters affirmed capping the cost of payday loans in the state to 28% interest, inclusive of all fees and other charges. Since that time, payday and car title lenders have evaded the voter-mandated cap, engaging in schemes to charge rates reaching over 300% annual percentage rate (APR), and even higher than 500% APR. In...

In recent years, payday lenders have drained over half a billion dollars in fees from Michigan consumers to out-of-state companies. By charging APRs over 340%, payday lenders cost Michigan consumers over $94 million in 2016 and over $513 million over the past five years. Over two-thirds of Michigan payday stores have headquarters out of state. Michigan payday lenders disproportionately locate...

Consumer, civil rights, faith, and community groups are urging the FDIC Chair in this letter to keep in place the agency’s guidance urging banks to not sell these toxic loan products, which are harmful to consumers, banks’ reputation, and its safety and soundness. The coalition’s letter also calls for the FDIC to ensure small dollar installment loans are capped at...

An application to file brief and brief of amici curiae, Center for Responsible Lending, National Association of Consumer Advocates, Public Citizen Inc, and Public Good Law Center in support of applelants, Eduardo de la Torre, et al.

We thank NCUA for its efforts to protect credit union members from payday loans. In recent years, the number of federal credit unions (FCUs) we are aware of engaging in payday lending, either directly or indirectly through credit union service organizations (CUSOs), has decreased to a single FCU. And through both its regular rules and its PAL program, NCUA has...

We urge NCUA to make no changes to the payday alternative loan (PAL) program that would increase the likelihood that credit union members end up in cycles of high-cost, short-term loans that resemble payday loan debt. Most critically, we strongly oppose permitting more than six application fees in twelve months as proposed for PAL II. We also oppose permitting 28%...

Lump sum single balloon payment payday loans with a two-week term have historically dominated the payday loan market. A shift in recent years, due to regulatory or industry changes, has been for payday lenders to make payday loans with longer terms due in multiple installment payments, each due on or around the borrower’s payday. Payday lenders often market these products...