Cummings Lauds CFPB Rule to Protect Small-Dollar Borrowers from Predatory Lenders
Washington, D.C. (June 2, 2016)—Rep. Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, issued the following statement on the proposed rule issued today by the Consumer Financial Protection Bureau (CFPB) to protect small-dollar borrowers from unscrupulous payday and car title loan lenders:
“Some of these payday lenders are vultures who prey on America’s neediest families, including many in Baltimore, and I applaud CFPB for proposing a strong rule to bring humanity back to short-term lending. Rules like this make me proud to have voted to create CFPB, and partisan attempts to roll back its progress harm the very people we have sworn to protect. I will continue fighting to ensure CFPB has the resources and support to continue its critical mission.”
In May of last year, Cummings held a Middle Class Prosperity Project forum on small-dollar lenders with Senator Elizabeth Warren (D-MA). Many small-dollar lenders employ predatory practices to trap consumers in a cycle of high fees and debt, harming not just the borrowers but their families and communities as well.
CFPB’s proposal would require small-dollar lenders to ensure that their borrowers have an ability to repay the loan while meeting other living expenses and without renewing the loan. It would also close many loopholes in state laws exploited by small-dollar lenders.