Consumer bureau revokes payday lending restrictions

[left-of-center2012]

Source: The Hill

The Consumer Financial Protection Bureau (CFPB) on Tuesday revoked rules that required lenders to ensure that potential customers could afford to pay the potentially staggering costs of short-term, high-interest payday loans.

The bureau released Tuesday the final revision to its 2017 rule on payday loans, formally gutting an initiative with roots in the Obama administration that was aimed at protecting vulnerable consumers from inescapable debt.

The initial rule, released shortly before President Trump appointed new leadership at the CFPB, effectively banned lenders from issuing a short-term loan that could not be paid off in full by a borrower within two weeks.

The measure required payday lenders to determine whether the customer had the “ability to repay” the loan with an underwriting process similar to what banks use to determine whether a customer can afford a mortgage or other longer-term loan.



Read more: https://thehill.com/homenews/administration/498649-consumer-bureau-revokes-payday-lending-restrictions

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A former CFPB economist argued in a memo obtained by The New York Times in April that Mulvaney’s political appointees manipulated data and published misleading research to justify scrapping the original payday rule.

[Voltaire2]

1. Of course it did.

The Crapfest of Corruption Continues.

[yankee87]

2. Consumer Protection?

Does 45 want every person who is hurting financially to be homeless and desperate? There will be so much to be done to repair the damage Putin's puppet has done to destroy this country.

[rurallib]

8. I get the impression that making people suffer (especially "those" people)

really gets Trump off.

[left-of-center2012]

3. "gutting an initiative with roots in the Obama administration"

Trump sure hates Obama.

[LogicFirst]

4. Because he's Black. So sad.

[machoneman]

5. Easy to fix though after Biden's inauguration. One E.O. and the old rule goes back in. Sad though...

...that some will suffer until then. Also, expect a flurry of weird, damaging, obscene and idiotic E.O.s soon and from now until Trumpy leaves the W.H.

He's using E.O's to allegedly show strength in combating Capitol Hill's increasing resistance to his desires. Folks in affected departments will slow-walk these changes, get outside help in filing court challenges and even quietly refuse to comply, all awaiting Trumpy's exit.

[keithbvadu2]

15. Repubs will immediately whine 'legislating by EO' while ignoring Trump's actions.

Repubs will immediately whine 'legislating by EO' while ignoring Trump's actions.

[Lonestarblue]

6. Instead of just fixing this rule, the whole payday lending industry needs an overhaul.

Better yet, allow post offices in some communities to offer some banking functions. It’s been done in the past. Here’s a Newsweek article describing some possibilities offered by Bernie Sanders.
https://www.newsweek.com/postal-banking-what-1438341

"The Postal Service already cashes Treasury checks and issues money orders. The USPS should fully exercise its existing statutory authority and implement pilot programs offering affordable financial services, including ATMs, paycheck cashing, bill payment and electronic money transfers in post offices," Sanders and Representative Alexandria Ocasio-Cortez said in a statement.

[Hoyt]

9. Do you think the Post Office should LEND money to people who likely can't pay it back?

Don't think that is the solution.

I detest these companies that loan people money for a few weeks with no collateral. But some folks are desparate and there are not always charitable organizations ready to pick up the slack.

I'm fine with the PO cashing checks for people without a bank, provided the checks are reasonably secure, but that's not what we are talking about here. Although, I'm not sure right now is a good time to promote the USPS as a bank, they have enough problems fending off the GOPers right now.

[Hoyt]

7. Obviously, most who need a payday loan really don't have the ability to pay it back, particularly

with the interest rates charged if the loan is not paid back within a few weeks. Many of these poor people are either in bankruptcy or about to be, even if not deemed bankrupt by a court.

I hope I never need one, and would discourage anyone thinking about it to check every charitable organization in the area. But, some people need a loan to feed their family. Unfortunately, many of these folks are going to default.

Honestly, it is a bit foolish to add the cost of underwriting a $500, or less, loan, to the loan terms, when you know the risk of default is so high.

I'd be fine with just outlawing payday loans, but who is going to step up and help people who need it short-term?

[erronis]

10. These federal bureaus and many agencies/commissions are really band-aids to poor laws

We shouldn't need a Consumer Financial Protection Bureau if the laws were written to prevent ripping off anybody.

Of course congress with its lack of expertise in anything except raising money and giving it to friends, doesn't know anything about financials, technologies, science, medicine. So we ask agencies to make decisions. We create bureaus and commissions to advise.

But with this imperial executive under barr/trump, these niceties are destroyed or emasculated.

[justgamma]

11. I read that military

personal were the biggest users of pay day loans. Another way to hurt our soldiers.

[AllaN01Bear]

12. payday stores are leagel loansharking to me .

[CRK7376]

16. Twenty years ago

these places were placed off limits to the military, at least with the Army guys. They were on nearly every street corner in and around Fayetteville, NC Home of Fort Bragg. Lots of young troops and plenty of mid level NCOs and some officers were getting into financial difficulties with those places. Uncle Sam made them off-limits.

[scarletwoman]

13. Another disgusting attack on the poor by the trump administration.

They are intent on doing everything they can to make life miserable for regular people.

[pecosbob]

14. My view is that there are far too many among our own ranks that support this industry

and far too many among of our own elected representatives have accepted political contributions from this predatory industry. It goes without saying that the GOP is the party of the grifters...that's not our bag, man.

[Xolodno]

17. Perfect timing.

Right when people are hurting for money.