Links in “Lending”

With consumer borrowing reaching a record high in February, expect scrutiny to grow, especially for the two categories that fueled the growth the most: auto loans and student loans. [4/8/15]

A white paper released during April’s Financial Literacy Month reveals an alarming trend.  While student debt is rising, an increasing percentage of college freshmen state that they are less prepared to manage their financial responsibilities than any other responsibility they face in college.  This means there needs to be a greater focus on financial literacy while students are in high school. [4/7/15]

The NCUA has revised its National Supervisory Policy Manual in order to expedite the approval of secondary capital requests by the regional offices, and make it possible for credit unions with secondary capital to return portions of the loans that no longer count towards net worth. [4/7/15]

The CFPB's proposal doesn't just make it harder to make short-term, low-dollar loans; it makes collecting them harder, too. Here's a recap of the collection practices rules in the CFPB proposal. [4/6/15]

This article argues that most of the consumers that use payday lenders are truly “unbanked” because they don’t qualify for services from banks and credit unions.  In an interesting twist, the article suggests that rather than looking for alternatives to payday loans, we should be looking at alternatives to the way in which these individuals are paid, perhaps allowing them to access their pay on a daily basis as it is earned. [4/2/15]

The CFPB released a new feature called "Your Home Loan Toolkit," which will assist consumers through the process of shopping for a mortgage and buying a home. The new toolkit was produced as part of the CFPB's "Know Before You Owe" initiative." [4/1/15]

CUNA economists predict that rising interest rates in 2015 and 2016 will lead to higher earnings, improved asset quality, and increasing capital.  New auto loans, purchase money mortgages, and credit cards are expected to show very strong growth. [4/1/15]

Panelists, including CFPB Director Cordray and representatives of consumer advocate organizations, gathered in the "predatory lending capital of the East Coast" (Virginia) to condemn payday and auto title lenders. However, they failed to offer viable alternatives to help consumers who find themselves in need of money and with nowhere else to turn. [4/1/15]

The CFPB's proposed expansion of the definitions of "small creditor" and "rural" would greatly help community bankers. [3/31/15]

The CFPB's plan to require lenders to verify borrowers are capable of repaying a loan, restrict the frequency that the loans could be extended, and capping finance charges got President Obama's approval as a "common sense" measure that stops companies from "trapping hardworking Americans in a vicious cycle of debt." [3/27/15]