Consumer lending

The Silicon Valley fintech expects to make $1.5 billion in auto loans this year after implementing key elements needed to achieve scale, said CEO David Girouard. The expansion comes as the automotive market continues to boom.

The company has agreed to pay at least $3.75 million to resolve allegations that it violated the District of Columbia’s 24% interest rate cap.

The deal is the latest example of a mainstream bank buying a point-of-sale lender focused on financing home improvement projects.

President Biden’s aspirations for aggressive forgiveness haven’t been fulfilled to date, but steps taken so far have lowered a key hurdle to entry-level homeownership.

Initial overcollateralization is 15%, with a build up to a target equal to the minimum of 21.5% of the current pool balance, and 16.5% of the initial pool balance.

The deal’s sponsor has issued a small rated portion to investors and sold the remainder back to loan-originator.

The sponsor’s Fortune 500 parent provides comfort in the face of the subprime-auto industry’s woes.

Trustmark Bank agreed to pay $9 million to resolve allegations that it discriminated against Black and Hispanic residents in Memphis, Tennessee. Attorney General Merrick Garland said the Department of Justice and other agencies will continue their crackdown.

The industry is prioritizing Black and Hispanic consumers in the interest of social equity and to tap new markets amid declining refinance volume and rising rates.

Banks, credit card issuers and debt collectors all supported the Consumer Financial Protection Bureau’s revised regulations. But they face a steep learning curve in complying with the rules, which take effect Nov. 30.