Challenging Payday Lenders by Opening up the Market for Small-Dollar Loans

“Why hasn’t someone else stepped in to lend at lower interest rates?” is the question frequently asked in discussions of payday loans. The average payday loan carries an Annual Percentage Rate (APR) of over 300%. Given the strength of th e payday lenders lobby at the federal and state level, one way to help low- and moderate-income households escape the financial harms of pa yday loans is to encourage other lenders to enter the small-dollar loan market and offer more affordable products. Over the past ten years, an array of affordable small-dollar loan programs offered by banks, credit unions, non-profit organizations, and for-profit fintech compan ies have entered the market to provide borrowers with alternatives to payday loans. These lenders are offering small-dollar loans at rates and on terms that are more manageable for low- and moderate-income consumers than payday loans, while maintaining the features of payday loans that consumers like—namely quick and easy access to credit. This paper w ill desc ribe these affordable small-dollar loan programs and explain what is needed from regulators, financial institutions and foundations, and consumer advocates for the programs to serve more borrowers and take over more of the market space curren tly occupied by payday lenders. Banks, with support from t he ir regulators, can offer affordable small-dollar loans to their customers and should continue to provide low-in terest loan capital to non-profit small-dollar lenders. Credit unions can continue to offer small-dollar loan programs like the Payday Alte rnative Loan product and the Employer Sponsored Small-Dollar Loan product and should be encouraged to do so by their regulators. Non-profit organizations can continue to offer affordable loans in partnership with employers or other lenders and should be provided with grants and low-interest loan capital and pro-bono support from la wyers and marketing companies. For-profit, fintech lenders can continue to enter this space and should be supported by consumer advocates and regulators as long as their products meet certain guidelines: compliance with all federal and state laws, affordable payments, and features such as credit bureau reporting, transparent fees, and flexible repayment terms. Finally, recent efforts in Congress to encourage the U. S. Postal Service to offer affordable small-dollar loans should also be supported. The short-term small-dollar credit needs of low- and moderateincome households should not be met primarily by payday lenders whose high fees and short repayment terms too often trap borrowers in a cycle of debt. Low-and moderate-income consumers deserve better options. With support, the affordable small-dollar loan programs described in this paper can be expanded to make the market for smalldollar credit more competitive, helping borrowers across the country

Thinking Like Entrepreneurs: Qlegal’s Experience of Teaching Law Students to have an Entrepreneurial Mindset

To advise a client you need to understand what they do. To provide truly innovative, client-centred advice, you also need to understand how they think. These observations are especially true when working with entrepreneurs who may be otherwise inclined to move forward with their business with or without legal guidance. Entrepreneurs are distinguished by their growth mindset and resilience, appetite for innovation and comfort with taking risks and doing things themselves. As the legal marketplace in the UK becomes increasingly competitive (due to legal technology and the growing number of alternative legal service providers), law students need to adopt an entrepreneurial mindset themselves, both to navigate the legal marketplacefor their own careers and to provide commercially aware legal services to their clients. Law schools need to teach law students to think like entrepreneurs, and commercial law clinics provide the natural setting. This paper adopts a qualitative case study approach to examine how qLegal, the pro bono commercial law clinic within the Centre for Commercial Law Studies (“CCLS”) at Queen Mary, University of London (“QMUL”) teaches students to develop an entrepreneurial mindset. We reflect on the importance of students learning about and developing this mindset, for their own professional development and to service the unmet legal needs of the start-up community. This paper will also highlight the challenges faced by qLegal staff, including our own legal training and experience, our obligations to real clients and our students’ expectations. We conclude by sharing examples of how we are currently teaching our students to have an entrepreneurial mindset and our ideas for overcoming our institutional challenges and improving our offering even more

A Guide for Developing Community Land Trust Affordable Homeownership Programs in Texas

This Guide is intended primarily for affordable housing developers and parts of the Guide may also be helpful for the low- and moderate-income families they serve. The goal of the Guide is to introduce the Community Land Trust affordable homeownership program to readers who are not yet familiar with it, to connect readers to excellent national and Texas-specific CLT resources, to share best practices in place in Austin for appraising CLT homes and land, and to share Texas-specific CLT legal documents.Texas Access to Justice FoundationLa

Challenging Payday Lenders by Opening up the Market for Small-Dollar Loans

“Why hasn’t someone else stepped in to lend at lower interest rates?” is the question frequently asked in discussions of payday loans. The average payday loan carries an Annual Percentage Rate (APR) of over 300%. Given the strength of th e payday lenders lobby at the federal and state level, one way to help low- and moderate-income households escape the financial harms of pa yday loans is to encourage other lenders to enter the small-dollar loan market and offer more affordable products. Over the past ten years, an array of affordable small-dollar loan programs offered by banks, credit unions, non-profit organizations, and for-profit fintech compan ies have entered the market to provide borrowers with alternatives to payday loans. These lenders are offering small-dollar loans at rates and on terms that are more manageable for low- and moderate-income consumers than payday loans, while maintaining the features of payday loans that consumers like—namely quick and easy access to credit. This paper w ill desc ribe these affordable small-dollar loan programs and explain what is needed from regulators, financial institutions and foundations, and consumer advocates for the programs to serve more borrowers and take over more of the market space curren tly occupied by payday lenders. Banks, with support from t he ir regulators, can offer affordable small-dollar loans to their customers and should continue to provide low-in terest loan capital to non-profit small-dollar lenders. Credit unions can continue to offer small-dollar loan programs like the Payday Alte rnative Loan product and the Employer Sponsored Small-Dollar Loan product and should be encouraged to do so by their regulators. Non-profit organizations can continue to offer affordable loans in partnership with employers or other lenders and should be provided with grants and low-interest loan capital and pro-bono support from la wyers and marketing companies. For-profit, fintech lenders can continue to enter this space and should be supported by consumer advocates and regulators as long as their products meet certain guidelines: compliance with all federal and state laws, affordable payments, and features such as credit bureau reporting, transparent fees, and flexible repayment terms. Finally, recent efforts in Congress to encourage the U. S. Postal Service to offer affordable small-dollar loans should also be supported. The short-term small-dollar credit needs of low- and moderateincome households should not be met primarily by payday lenders whose high fees and short repayment terms too often trap borrowers in a cycle of debt. Low-and moderate-income consumers deserve better options. With support, the affordable small-dollar loan programs described in this paper can be expanded to make the market for smalldollar credit more competitive, helping borrowers across the country

Texas Tenant Relocation Assistance Toolkit

The purpose of this toolkit is to identify the resources available to tenants in Texas when they are displaced from their homes due to development funded in any part by federal dollars or caused by local or state government action. The primary audience for this toolkit is tenants and tenant advocates, including community organizers, legal aid attorneys and paralegals.La