High-Cost Loan Product from US Bank
Listen to an interview with CRL's Rebecca Borné on the Money Life podcast discussing U.S. Bank’s new dangerous payday loan alternative product, Simple Loan.
This payday-like loan is brought to you by ... a bank?
Consumer advocates for years have decried payday loans as a costly way to borrow and one that keeps people trapped in a cycle of high-interest debt. The howls of protest could grow louder now than a major bank has stepped forward with a similar product.
Dodd-Frank small-business rule seen as unlikely to advance at CFPB
A provision of the 2010 Dodd-Frank law aimed at fair lending for minority and women-owned small businesses is unlikely to move forward, according to several people with knowledge of the matter. Banks and other small-business lenders have sometimes balked at the requirement the law sets for them to collect information. Yet Scott Astrada, director of federal advocacy for the Center...
An Alternative to Payday Loans, but It’s Still High Cost
U.S. Bank, one of the country’s biggest banks, has again begun offering customers small, high-cost loans, saying the loans now have safeguards to help keep borrowers from getting in over their heads. The loans, between $100 and $1,000, are meant to help customers deal with unexpected expenses, like a car repair or a medical bill, said Lynn Heitman, executive vice...
Man who led effort to shut down Arkansas payday lending stores calls U.S. Bank's new loans 'very disturbing'
Minneapolis-based U.S. Bank last week began offering a small-dollar loan product called Simple Loan that charges interest rates ranging from more than 70 percent to almost 88 percent. "This type of product isn't a safe alternative to a payday loan," Rebecca Borne, senior policy counsel at the center, said in a statement. "And we reject the notion that bank loans...
Student Loan Debt Can Sink Your Retirement Plan
If you’ve defaulted on a federal student loan, beware: The federal government can take up to 15 percent of your Social Security benefit. The number of people 60 and older with student loan debt quadrupled from 700,000 to 2.8 million between 2005 and 2015, according to the Consumer Financial Protection Bureau (CFPB), threatening financial stability for those heading into retirement...
Payday lenders say they are suffering 'irreparable harm'
The trade group representing payday lenders has asked a court for an injunction to block implementation of the Consumer Financial Protection Bureau's (CFPB) small dollar loan rule. The CFPB small dollar loan rule is scheduled to take effect next year, but a larger threat to payday lenders may come in the form of competing products from traditional banks. Last week...
Report reveals payday loans are draining millions from Michiganders
Consumer advocates say strong reforms are needed to better regulate the payday lending industry in Michigan, and they just might have the data to prove it. A new report from the Center for Responsible Lending found that in the past five years, payday lenders have taken more than half a billion dollars in fees from consumers in Michigan, including $94...
A major bank is offering payday-style loans. Will others follow suit?
U.S. Bank says it will offer nearly instant small loans to its customers, becoming the first bank to provide such a product since federal regulators cleared the way earlier this year amid continuing concerns over the costs of payday loans. Graciela Aponte-Diaz of the nonprofit Center for Responsible Lending said she’s particularly concerned about U.S. Bank customers who take out...
CFPB to Revive Disclosure Sandbox Plan
The Consumer Financial Protection Bureau is set to revive a program that would allow companies to experiment with new forms of disclosures without facing regulatory penalties. The CFPB could allow for disclosure innovation without giving up its enforcement and oversight tools, Scott Astrada, the director of federal advocacy at the Center for Responsible Lending, told Bloomberg Law in a Sept...