Research

The California Office of the Center for Responsible Lending prepared the following documents to help California's newest legislators navigate the predatory mortgage lending arena. About Mortgage Lending SNAPSHOT: California Mortgage and Foreclosure Data January 2009 CA Foreclosures by Assembly and Senate District Read Paul Leonard's August 4 testimony on the state of the mortgage crisis in California, " The Mortgage Crisis Today: How Far Have We Come and Where Do We Need to Go?". Protecting Homeownership, Reforming the Marketplace: The California Legislature's Role in Today's Crisis About Us...

There are more than 2,400 payday lending stores in California in 2008, more than all Starbucks and McDonald's combined. California borrowers took out more than 10 million payday loans in 2006, totaling $2.5 billion. Payday fees strip $405 million from payday borrowers annually. Payday loans are small, short-term loans secured by the borrower's personal check. The typical two-week loan is costly, with lenders allowed to charge an annual percentage rate (APR) of up to 459 percent. Although marketed – and justified – as a short-term emergency advance on a borrower's paycheck, the data show that...

After years of industry-blocked efforts to strengthen lending standards, the growth in reckless lending and abusive practices has left California facing a foreclosure crisis with catastrophic consequences for families, communities, and the California economy as a whole. California needs policy reforms to stem the tide of foreclosures, and to tighten lending standards to prevent a repeat of this foreclosure crisis. Defaults And Foreclosures Have Increased Sharply Since 2006. Completed quarterly foreclosures increased from less than 3,500 in 3Q 2006, to nearly 80,000 foreclosures in 3Q 2008...

Our nation's current economic crisis was driven by, among other things, three significant shortcomings in the mortgage system: 1) loose or nonexistent underwriting standards; 2) misplaced financial incentives that created conflicts between industry profits and borrowers' interests; and 3) lack of accountability among industry players for loan quality or performance. Given this systemic failure, the State should step in to limit spiraling foreclosures and to reform regulations for new lending. State lawmakers should both act at the state level and also encourage federal policymakers to act to...

Cost Climbs to $1.9 trillion during 2009-2012, with 92 million homeowners losing $20,300 on average This is CRL's third report on the spillover impact of mortgage foreclosures. This new report is based on new CRL projections of 2.4 million foreclosures for all loans (not just subprime) in 2009, and 9.0 million during 2009-2012. This report also reflects a somewhat more conservative methodology for calculating the spillover impact. Based on current market data, CRL now projects that some 2.4 million foreclosures will occur in 2009, and 9.0 million during 2009-2012. In addition to the...

On March 1, 2006, Attorney General Roy Cooper announced that the last three major out-of-state payday lenders had agreed to stop making illegal loans in North Carolina. As a result, working families in the state will save almost $100 million each year -- money they can use to buy food, pay their bills, and balance their family budget. Related Resources Statement of CRL's Mark Pearce More information on payday lending... We applaud this milestone, which should be an example for other states where the payday lenders still do business. The achievement took five long years and the hard work of...

In this report, we estimate how many homes—including families who are paying their mortgage on time—will suffer a decline in property values because of foreclosures in their neighborhoods. We also estimate how much the average family will lose in home equity, and how much of an impact the foreclosure crisis will have on city and county coffers.