STEP FORWARD - Shriver Center

By Karen Harris, Supervising Attorney

In recent years several states have enacted annual percentage interest rate (APR) limits that eliminate the triple-digit interest rates charged by payday lenders. The payday lending industry is now fighting back by sponsoring ballot initiatives that threaten these sensible payday lending regulations in two states: Arizona and Ohio.

A “no” vote on Proposition 200 in Arizona will ensure that payday lenders’ current predatory practices will no longer be permitted when the exemption for such lenders from the state’s 36 percent APR cap expires in 2010. In Ohio, by contrast, a “yes” vote on Ballot Issue 5 will create a 28 percent APR cap on payday loans, while a “no” vote will allow payday lenders to continue charging up to 391 percent interest rates. Thus Arizona voters should vote “no,” and Ohio voters should vote “yes,” on these critical ballot measures to protect their communities from the debt traps caused by abusive payday loans. (more…)

By Kelly E. Slay, Asset Building Specialist

While Bank of America was making plans to finalize its pending acquisition of Countrywide Financial Corp., Illinois Attorney General Lisa Madigan was making a plan of her own. On Wednesday, Madigan filed a civil lawsuit alleging Countrywide’s violation of the state’s consumer protection statutes-relaxing underwriting standards, structuring loans with risky and defective features, and intentionally misleading consumers are just a few of the claims against Countrywide and its chief executive, Angelo R. Mozilo.  The Shriver Center has been actively voicing concerns over Bank of America’s acquisition of Countrywide, including writing letters to legislators and discussing with federal regulators during the 2008 National Community Reinvestment Coalition Conference in Washington, D.C. California followed the lead of several advocates and the State of Illinois by filing a similar lawsuit of its own. (more…)

By Brian Clappier, Community Investment Specialist

Tough times often bring out the best of people, but, with the latest surge of economic gloom, optimism can be difficult. Today’s cutthroat, globalized economy is undoubtedly challenging to American workers, but it has also compelled a novel partnership between employers and employees that addresses the need for new skills and knowledge. The Shriver Center supports and promotes Lifelong Learning Accounts (LiLAs) as a step to help the nation’s workforce keep pace with an evolving job market. This innovative program creates portable, universal, voluntary, employer-matched, employee-owned individual educational accounts used for training and educational purposes. (more…)

By Andrea Kovach, Staff Attorney

It’s not news that major medical emergencies or the treatment of chronic illnesses often cripple a family’s financial stability. What’s now becoming clear is the flip side of that story-how families suffering from financial debt often experience problems that affect their health and productivity. (more…)

By Brian Clappier, Community Investment Specialist

Home is where the heart is, so the saying goes, and for many Americans, it is also where the majority of their assets lie. Unfortunately, as home foreclosures rose by 78 percent in 2007 to 1.77 million, with another 3 million expected to go into default by mid-2009, this year is proving itself calamitous for the hearts, homes, and assets of many Americans. Amid this foreclosure tsunami, Congress has still not taken substantive action.

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By Dory Rand, Supervising Attorney, Community Investment Project

One in five households in America owes more than it owns, according to the CFED 2007-2008 Assets & Opportunity Scorecard. The Shriver Center is advocating public policies and private initiatives that help households save and build assets. The income that households receive from tax refunds and stimulus payments provides opportunities to pay down debts and accumulate savings, but policy reforms are needed to avoid penalizing families who receive public benefits for saving.

Spend tax refunds “to recession-proof your financial house,” urges Gregory Karp. “If you don’t have a rainy-day fund of three to six months of bare-bones expenses, now is the time to build one,” Karp said in the Allentown Morning Call on March 30. Karp suggests that people “stash the cash in a higher-rate online savings account … and then set up an automatic deposit from your regular checking account to the savings account.” This advice applies as well to the stimulus payments that the Internal Revenue Service will deliver starting in May.

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By Brian Clappier, Community Investment Specialist

An increasing number of Americans are approaching the end of their working years, yet nearly half of the nation’s workforce lacks access to employer-based retirement plans. The Shriver Center has responded by supporting portable retirement accounts as a strategy for those left uncovered. In California, Gov. Arnold Schwarzenegger gave portable retirement accounts a strong push forward last Tuesday by voicing his support for Assembly Bill 2940 and the California Employee Savings Program (Cal ESP). The announcement placed his state in the lead of a national movement to encourage retirement savings among low-income, short-tenured, transferable, and small-business employees.

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