Charlottesville, Va. – On Monday, Virginia Organizing and Americans for Financial Reform co-hosted a virtual forum for members to speak with Richard Cordray, the former director of the Consumer Financial Protection Bureau (CFPB), as well as Linda Jun, Senior Policy Counsel with Americans for Financial Reform, and Seth Frotman, Executive Director of the Student Borrower Protection Center. The presenters discussed the urgent need for a 36 percent cap on predatory lending at the federal level and took questions from participants.
“We’re facing a brand new crisis for consumers,” Cordray said. “Never, with such speed, have we seen our economy fall apart the way it has. If you take the view that it’s time to go easy on finance companies, then the brunt of this will fall on consumers. We need consumer finance companies to be performing at their best right now, and we need the CFPB to make sure that protections are held in place and that lenders are held accountable for their performance.”
Fredericksburg Chapter leader Bob Straight asked whether the CFPB can start forcing lenders to make sure that people can afford to re-pay the loans they are given. Cordray answered that some progress has been made since the 2008 financial crisis in the mortgage and credit card markets. “What that tells me is we can make a difference. We should be confident about that project, but we’re not learning fast enough.”
New River Valley Chapter leader Dustin Robins asked whether anything has been learned from previous recessions, and Cordray answered that in previous crises the federal government made the mistake of giving huge bailouts to big banks and expecting that money to trickle down to “Main Street” and consumers. Cordray added, “This time there is some money starting to flow through to small business and consumers. The CARES Act only covers 60 percent of foreclosures so far, so we really need to broaden that.”
Valerie Washington of the Charlottesville Chapter asked Seth Frotman, “More education has always been one of the answers for getting out of poverty. If college isn’t beneficial in the short term because of crushing debt, what should we be telling people who want to go to college?” Frotman answered, “Most families had yet to dig out of the last financial crisis when it came to student debt. Now are we simply going to pile another crisis on all of them? In Virginia and other states they’re already talking about significant slashes to higher education budgets. We need to push back against that.”
Tyran Green, a member of the Virginia Organizing State Governing Board from Portsmouth, said the forum reminded her why this is such an important issue.
“Predatory loans undermine our financial future,” said Green, “and consumer protection is essential to making people’s lives better. Recovery funds have to be made available to all Virginians.”
For more quotes from the forum or to interview a spokesperson, please contact Rosemary Gould at rosemary@virginia-organizing.org or 434-962-7261.
