Research

Higher education can be the gateway to a better life. Yet the rising costs of a college education and poor oversight of student loans have left some graduates and former students deep in debt—especially when enrolled in for-profit colleges. The Center for Responsible Lending (CRL) found that students of color enroll more frequently in for-profit colleges than other students, graduate...

Although marketed as quick cash for financial emergencies, payday and car-title loans typically become long-term debt that drains hundreds of dollars—if not thousands—from consumers. These small dollar loans carry average annual percentage rates of 391% that make it very difficult to escape a cycle of debt that can last months or years. Either through direct access to borrower bank accounts...

Financial institutions drain billions of dollars annually from their customers through abusive overdraft fee practices. Frequently marketed as a “customer service,” overdraft fees are charged when a customer’s account lacks sufficient funds to cover a transaction and the institution pays the transaction anyway. The institution then repays itself the value of the overdraft transactions and all accompanying fees from the...

A home is more than just where families come at the end of the day—it is also where children are raised and memories are created. Homeownership is the primary way families of modest means build wealth, which can be passed on to the next generation. In recent years, most mortgages approved for lower wealth families and consumers of color were...

Although debt collection plays an important role in how credit markets function, it can also expose American households to unnecessary abuses, harassment, and other illegal conduct. Unscrupulous debt collectors sometimes use incorrect data and illegal collection tactics to file lawsuits or pressure consumers into making payments on debt they may not owe. Even worse, millions of consumers become aware of...

A car purchase can expand economic mobility; but tricks and traps in auto financing can lead to harm and abuse. Among those tricks and traps is dealer interest rate markup. Car dealers can add extra interest to a car loan, and keep some or all of the difference. This practice has a long history of unfair and discriminatory impact. CRL...

Payday lending involves small‐dollar, high‐interest loans that trap consumers into a long‐term cycle of debt and fees. Payday lenders tout themselves as a needed service providing access to emergency credit. However, with weak underwriting and ability to repay standards, the payday loan model creates a debt trap that is easy to get into, but extremely difficult to escape. Each year...

For the fifth consecutive year, a poll conducted by Lake Research Partners and Chesapeake Beach Consulting shows overwhelming and bipartisan support among likely voters for regulation and oversight of the financial services industry. Backing from Republicans is at historic highs. Voters also believe that Wall Street's influence in Washington is high and growing under the Trump administration, and are wary...

Banks once drained $500 million from customers annually by trapping them in harmful payday loans. In 2013, six banks were making triple-digit interest payday loans, structured just like loans made by storefront payday lenders. The bank repaid itself the loan in full directly from the borrower’s next incoming direct deposit, typically wages or Social Security, along with annual interest averaging...

Students at Maine’s for-profit colleges carry higher levels of debt, borrow in higher percentages, and have worse repayment rates on that debt compared to their peers at public and private non-profit institutions. Because African Americans, females, and low-income students are disproportionately enrolled in Maine’s for-profit colleges, these poor outcomes fall more heavily on these vulnerable subgroups. This report uses the...