Community development financial institutions (CDFIs), a critical source of credit in lower-wealth communities, need more stable and consistent sources of lending capital  to have an impact on the recovery of markets most impacted by the economic crisis, says a report from Woodstock Institute published by the Federal Reserve Bank of San Francisco’s Center for Community Development Investments.

The House of Representatives overwhelmingly voted this week to accelerate the implementation of the Credit CARD Act, which will provide protections from some abusive credit card practices.

New foreclosure filings in the Chicago metro area have returned to first-quarter 2009 levels after a slowdown in the second quarter, says the latest Woodstock Institute analysis of regional foreclosure activity. This sharp increase likely reflects federal and state interventions that delayed new filings in the second quarter until the third quarter.

Rep. Carolyn Maloney (D-NY) and Sen. Christopher Dodd (D-CT) introduced bills in October targeted at curbing some of the abusive practices of overdraft protection programs. A recent Woodstock report cited the impact of overdraft programs on older persons and found that this product, and other high cost forms of credit, may increase economic insecurity later in life.

Over major opposition from the financial industry and nearly all Republican committee members, the House Financial Services Committee today passed HR 3126, which would create the new federal Consumer Financial Protection Agency (CFPA) to protect consumers from abusive and deceptive financial products and practices.  Advocates are hopeful that the bill will be strengthened in the Senate where Woodstock and others are pushing for agency oversight of the Community Reinvestment Act, which has been severely weakened under the current regulatory structure.

Checking accounts with high-cost overdraft fees are increasing older persons’ economic vulnerability, says a new report from Woodstock Institute, “Improving Economic Security Later in Life: Meeting the Credit and Financial Services Needs of Older Persons.” The controversial overdraft fees, recently under fire from Senator Chris Dodd (D-CT), particularly burden beneficiaries of Social Security payments and low-income older persons.

Woodstock Institute applauds Rep. Melissa Bean’s (D-IL) decision to withdraw her amendment to the Consumer Financial Protection Agency (CFPA) Act that would allow large national banks to override state consumer protection laws.

The Department of the Treasury recently released its third report card on how mortgage lenders are doing modifying loans for eligible homeowners under the government’s Making Home Affordable program (see the first and second report card).

As early as today the U.S. House Financial Services will vote on a bill aimed at reforming our nation’s troubled financial system by creating a Consumer Financial Protection Agency. This agency would do the same thing for financial products that the Food and Drug Administration does for medical safety and the Consumer Products Safety Commission does for products like toys and electronics: set common sense rules to keep institutions from peddling bad mortgages and loans that destroy families’ financial futures. The Consumer Financial Protection Agency could have headed this financial crisis off at the pass by preventing millions of mortgages with wildly adjustable rates and exploding payments from ever entering the market.

The Chicago Tribune recently reported on American Union Savings & Loan Association’s objection to receiving a poor rating under Community Reinvestment Act (CRA) from the FDIC, its regulator.   American Union’s claim—that “reckless lenders attract [mortgage] applications and get favorable CRA ratings [and] these applications turned into bad loans”—is one that has been widely discredited by banking regulators and researchers.