August 4, 2020
AFSPA Partner


Expanding access to credit to underserved communities

The Equal Credit Opportunity Act (ECOA) and Regulation B prohibit discrimination on a prohibited basis in any aspect of a credit transaction. The Special Purpose Credit Program (SPCP) provisions of the Equal Credit Opportunity Act (ECOA) and Regulation B, however, provide targeted means by which creditors can meet special social needs and benefit economically disadvantaged groups. We wish to remind both for-profit and not-for-profit creditors of the availability under ECOA and Regulation B of SPCPs to meet the credit needs of underserved communities.

In particular, ECOA and Regulation B permit for-profit organizations to offer SPCPs or participate in SPCPs to meet special social needs, if:

The program is established and administered pursuant to a written plan that identifies the class of persons that the program is designed to benefit and sets forth the procedures and standards for extending credit pursuant to the program; and
Read more at Consumer Financial Protection Bureau


MISSOURI: Springfield voters to decide on $5,000 fee for short-term lending establishments

SPRINGFIELD, Mo. (KY3) - Springfield voters will decide whether short-term loan businesses should have to pay a yearly fee of up to $5,000.

"We have heard anecdotal stories now about how busy payday lenders have been since March 15 when people were getting laid off," said Community Foundation of the Ozarks president Brian Fogle.

Fogle said this issue is important now more than ever.

"I do worry about those consequences going forward, so it's more timely now than it was March 1, certainly," Fogle said.
Read more at KY3


TEXAS: CFPB and trade groups ask Texas federal court to lift stay of lawsuit challenging payday loan rule but disagree over next steps. written by Ballard Spahr LLP

The CFPB and the two trade groups challenging the CFPB's 2017 final payday/auto title/high-rate installment loan rule (2017 Rule) have filed a joint motion asking the Texas federal district court hearing the trade groups' lawsuit to lift the stay of the lawsuit, originally entered in June 2018 on the heels of the trade group's motion for a preliminary injunction and before the CFPB's response to the motion or answer to the complaint in the case.

Following the court's initial stay of the lawsuit, the court entered an order in November 2018 staying the August 19, 2019 compliance date for both the 2017 Rule's ability-to-repay provisions and its payment provisions. While both sides now agree that the stay of the lawsuit should be lifted, they disagree on next steps. Once the stay is lifted, the Bureau intends to file a motion to also lift the stay of the compliance date for the payment provisions so they can take effect. The trade groups, however, plan to oppose that motion and continue to challenge the payment provisions.
Read more at JDSUPRA

Alchemy Partners with LoanPaymentPro to Provide Real-Time Funding and Payment Solutions

Payday lending interest cap is headed for NEBRASKA's ballot

LINCOLN - Nebraska voters likely will decide in November whether to cap payday loan rates, according to the Secretary of State's Office.

State election officials were still tallying verified petition signatures Thursday, but a spokeswoman said it appeared that initiative petition drive organizers "have the required numbers of signatures that they need."

Nebraskans for Responsible Lending must have about 85,200 valid signatures to qualify their proposal for the general election. The group turned in more than 120,000 at the end of June.

The group's proposal would cap payday loans at a 36% annual interest rate, the same limit already enacted in 16 states plus the District of Columbia. Congress also passed a 36% cap for active-duty military personnel after the Defense Department reported that payday lending was negatively affecting military readiness and the morale of troops.

Dreher Tomkies LLP

The Fed is extending its lending programs until the end of the year

The Fed will run the lending and credit programs aimed at countering the economic downturn until the end of the year.
A slew of initiatives aimed at credit markets, small and large businesses and corporate bonds, was set to run out Sept. 30.

The Federal Reserve said Tuesday that it is extending its menu of lending programs to businesses, governments and individuals to the end of 2020.

Originally set to expire Sept. 30, the myriad facilities, stretching from credit to small businesses up to the purchase of junk bonds now will stretch to Dec. 31.

The Fed began rolling out the initiatives as market functioning broke down in March. A lack of liquidity stemming from fears over the coronavirus crisis froze markets and pushed the central bank into various credit facilities, a number of which had their origins during the financial crisis.
Read more at CNBC


How Much Federal Defense Money Goes to Your State?

Spending on Contracts Drives Growth in Federal Defense Dollars to States

Total jumped 12% from fiscal year 2017 to 2018, but the mix of sources meant a wide range of increases

The U.S. government spends defense dollars in every state through purchases of military equipment, wages for service members and civilians, pension payments, health care services, and grants to states. In fiscal year 2018-the most recent year for which data is available-the federal government spent a total of $579 billion on defense in the states and the District of Columbia, or $1,772 per capita.

On a state-by-state basis, per capita defense spending ranged from $565 in Oregon to $7,455 in Virginia. The District of Columbia received the highest amount in the country at $10,779 per person. (See Figure 1.)
Read more at The Pew Charitable Trusts


Federal Trade Commission Announces Staff Reports on Car Buying and Financing Experience, Results of Auto Buyers Study

Two new staff reports from the Federal Trade Commission highlight some of the challenges and confusion consume
al price negotiation that can lead to them paying more than expected.

The reports are based, in part, on a study of auto buyers conducted by the FTC that consisted of in-depth interviews with 38 consumers about the car buying and financing process.

A staff report from the FTC's Bureau of Consumer Protection (BCP) notes a number of issues that arose in the study, from the advertising that draws consumers in through the entire car buying experience.
Read more at Federal Trade Commission


States Use COVID-19 Relief Dollars to Hold Down Business Taxes

Governors and lawmakers in at least eight states have used millions of federal coronavirus relief dollars to protect businesses from tax increases as unemployment skyrockets.

They're pushing relief dollars into unemployment insurance trust funds, which are funded by business taxes and pay out benefits to laid-off workers. If the funds start to run out of money - as they now are in many states - state and federal law triggers tax increases to replenish the accounts.

Many Republicans and business groups say avoiding business tax increases during a recession is a no-brainer. West Virginia Gov. Jim Justice, a Republican, wants to spend $687 million - more than half the money the state received in March - on unemployment insurance, for instance.
Read more at The Pew Charitable Trusts


Oral Testimony of CFPB Director Kraninger Before the House Financial Services Committee

Chairwoman Waters, Ranking Member McHenry, and Members of the Committee, thank you for this opportunity to provide you with an update on the CFPB's important work. I appear before you as the country is engaged in a national conversation on racial inequality and confronting the unprecedented pandemic. Today, I would like to discuss both topics with you.

Under my leadership, the CFPB is taking steps to help create real and sustainable changes in our financial system so that African Americans and other minorities have equal opportunities to build wealth and close the economic divide.
Read more at The Consumer Financial Protection Bureau


The CFPB is taking action to build a more inclusive financial system

In the midst of our country's national conversation on how to put a stop to racial inequality and achieve fair treatment across our society, the agency I run-the Consumer Financial Protection Bureau-is playing a lead role in this conversation as it relates to fair treatment and equitable access to credit. As important as conversations are, actions matter more. Under my leadership, the CFPB is taking steps to help create real and sustainable changes in our financial system so that African Americans and other minorities have equal opportunities to build wealth and close the economic divide.

What is the Bureau doing? There are many laws already on the books that prohibit credit discrimination. But many questions remain as to how to interpret and apply these laws to achieve the goals of fair lending, including preventing credit discrimination and expanding access to credit. Identifying and resolving these questions will provide needed clarity to advance these important goals.
Read more at The Consumer Financial Protection Bureau



Alternative Financial Service Providers Association

315 Tuscarora St., Lewiston, NY 14092