Links in “Lending”

New York's Department of Financial Services gets Bank of America to sign up for the software tool the state has developed to flag payday lenders that could be violating state rules. The superintendent pledges that the state will be reaching out to additional banks to join the effort. [6/17/14]

The student loan refinancing bill stalls in the Senate amidst concerns that its flaws may outweigh its benefits, and that more scrutiny may be necessary. [6/17/14]

The state alleges that CashCall made misleading representations and omitted material information to lure consumers into taking out loans in amounts greater than they were seeking. The lender routinely charged rates of 135% or more. California is seeking to suspend CashCall's license. [6/16/14]

According to CU Business Group, LLC, an MBL CUSO, its clients are reporting that NCUA examiners are focusing on several issues in recent exams:

• Business owner’s living expenses
• Global cash flow calculations
• Flood insurance coverage
• Loan participations
• Taxi medallion loans (no surprise here) [6/13/14]

When payday lenders in Ohio were restricted by state law to loans with interest rates of 28%, no more than $500, and with a minimum 31-day payback period, payday lenders began making loans under the Mortgage Loan Act which has no cap on interest rates and permits single lump payments (the case surrounded a borrower who failed to repay a $500, 2-week loan with an interest rate of 235%). A lower court said payday lenders were skirting the law. Ohio's Supreme Court disagreed, saying its justices could not second-guess the intent of legislators. [6/13/14]

CFPB Director Cordray says that public shaming of mortgage loan services who automatically put a student loan into default if a cosigner dies or becomes incapacitated is important, but that more tools may be needed through rulemaking. It was one of several responses he gave before a Senate hearing this week. [6/12/14]

By obtaining an opinion from a credible third party on a borrower's ability to repay, a lender has gone a long way to demonstrate that it has acted in good faith. [6/11/14]

A Pennsylvania-based home builder that offers home financing has settled Federal Trade Commission charges that it deceived consumers by advertising low-cost mortgages while hiding fees and not disclosing vital information about the true cost of the mortgages. [6/11/14]

Square is positioning its new product, Square Capital, as an alternative to traditional small business loans. Square Capital leverages Square’s existing payment processing relationship with merchants to offer fast access to capital with simple repayment plans. [6/10/14]

Pres. Obama announces the expansion of "Pay as You Earn," which caps graduates' repayments at 10% of their monthly discretionary income, to an estimated 5 million more borrowers. [6/10/14]