The Federal Reserve Bank of Dallas’ recent report entitled “The CRA and Subprime Lending: Discerning the Difference” concludes that the Community Reinvestment Act “is unequivocally not to blame for the housing market’s fall. The numbers just don’t add up.” Moreover, data from the Board’s staff report suggest that the CRA prevented the subprime situation from being more severe.
Woodstock Institute joined Illinois State Treasurer Alexi Giannoulias
and the Community Reinvestment
Organizing Project in announcing the adoption of the state’s Commitment
to Community Reinvestment Policy. The policy requires all
state depositories to certify that they provide access to mortgages, financial
services and small business lending throughout their service area, including
Woodstock Institute joined Senator
Durbin on May 4 to announce S.566,
a bill to create Financial Products Safety Commission. The commission,
originally proposed by Elizabeth Warren, chair of the Congressional Oversight
Panel, would monitor the products and services offered by financial institutions
and work to eliminate the negative impact of financial products on
Critics of the CRA (Community
Reinvestment Act) have claimed the act played a key role in the subprime
meltdown, but numbers don’t support that claim, according to research recently
released by a multi-state collaboration of regional research, policy, and
In a significant victory for consumers, the House Financial Services Committee passed the Credit Cardholders’ Bill of Rights (H.R. 627) by a vote of 48 to 19. The bill now moves to the full House of Representatives for consideration.
Stephen Colbert of the Colbert
Report did a great
piece on Illinois Congressman Luis Gutierrez’ so-called Payday Loan Reform
Act of 2009 (H.R. 1214). Colbert notes that although Rep. Gutierrez used to
be on the side of consumers, introducing legislation in previous sessions to ban
payday loans, he recently changed his tune and has introduced a bill to codify
payday loans with rates over 700 percent interest. Colbert suggests that this
shift in policy position might have occurred because of recent campaign
contributions from the payday industry.
The anti-predatory mortgage lending bill proposed by House Financial Services Committee Chair Barney Frank, H.R. 1728, contains many good provisions but several problematic provisions as well.
In recognition of her steadfast leadership of the U.S.
Department of Treasury’s Community Development Financial Institutions (CDFI)
Fund, and exemplary accomplishment delivering capital to the front lines of
community economic development, Woodstock Institute presented its Annual
Community Reinvestment Award to the Fund’s director, Donna Gambrell at an event
on April 2, 2009.
With triple digit interest rate consumer loans
continuing to evade consumer protections in several states, including Illinois, Senator Dick
Durbin today announced the Protecting
Consumers from Unreasonable Credit Rates Act of 2009, which would establish
a federal interest rate cap of 36 percent.
Chicago – As
states across the country put strong restrictions on payday loans, including
rate caps and restrictions on abusive refinancing, a new bill
introduced by Rep. Luis Gutierrez (D-IL) and currently being debated by
Congress would undermine consumer protection efforts by permitting triple digit
interest rates and offering troubled borrowers only an insufficient repayment
plan to break the cycle of debt.
Can you imagine paying 177% on a used car loan? Some did according to a recent report by Woodstock Institute and the Public Action Foundation, as reported by Crain's Chicago Business.
Currently about half of all workers lack workplace pensions or retirement plans. Among the President’s many bold ideas outlined in his recent address to Congress and 2010 budget are two little-noticed proposals for helping people build retirement security.
Renegotiating unaffordable loans has been central to foreclosure prevention efforts under two administrations, but mortgage servicers lack incentives to aggressively pursue significant and sustainable loan modifications.
The Treasury Department and Congressional committees have recently taken several steps in the right direction regarding the financial crisis.
The Chicago region housing market is likely to remain weak, and serious concerns about the performance of Alt-A and prime mortgages will take center stage in 2009.