Consumer lending

A pullback by the buyers of Upstart's consumer loans led to a "challenging year," CEO Dave Girouard told analysts. But he added that the company is in "late-stage discussions" with partners that are looking to make longer-term commitments.

PAID 2023-1 will secure the underlying assets through a three-month pre-funding period, half of the six-month period that was in place for 2022-5.

After soured loans rose above the private student lender's expectations in 2022, its stock price fell 16% on Thursday. One analyst wrote that "persistent credit issues have damaged management's credibility."

Upstart Holdings implemented underwriting and pricing changes in response to higher delinquency and CNL rates on securitizations issued since Q1 2021.

Goldman Sachs provided more details on its pullback from its once-grand ambitions to expand into consumer finance. Though parts of that strategy will remain, the New York bank will halt its personal loan business and postpone offering a checking account for its wealth management customers.

Foreclosure starts also increased by over 19% between October and November but remain below pre-pandemic levels.

In an appeals court filing, the Consumer Financial Protection Bureau wrote that a federal judge "ignored regulatory text, history and context" when she ruled against a PNC customer. The consumer argues that the bank shouldn't have pulled funds from his checking account after he was tardy in making payments on his home equity line of credit.

The San Francisco bank joined Bank of America, U.S. Bancorp and Huntington Bancshares, which have previously introduced similar products. The Pew Charitable Trusts said the loans are a more affordable option for cash-strapped consumers than payday loans and overdraft fees.

A ballot initiative that places additional restrictions on debt collectors and decreases the interest rates that can be charged on medical debt passed Tuesday by an overwhelming margin. Consumer advocates say it will ease the burden on households dealing with hardship, but industry groups contend that it will make credit more expensive.

Credit bureaus should know better than to include "impossible" data, such as someone defaulting on a loan before they were born, says Consumer Financial Protection Bureau Director Rohit Chopra.

The state Supreme Court heard oral arguments in a lawsuit involving one of the nation's largest debt buyers. At issue is how much detail the industry must disclose about what consumers allegedly owe.

Recent reports highlight the question of how much wage growth can do to sustain loan performance as pandemic relief gets rolled back, consumer costs rise and the housing market cools.

Even though delinquency rates were previously at extremely low levels, the recent uptick among poorer consumers is worth monitoring, New York Fed researchers said.

The Consumer Financial Protection Bureau said “time is running out” for military student loan borrowers to obtain debt relief under the Public Service Loan Forgiveness program.

The McLean, Virginia, company is starting to “trim around the edges” of its auto portfolio, CEO Richard Fairbank said. That move stands in contrast with Capital One's leaning into its credit card business, which helped push marketing spending above $1 billion.

Klarna Bank, which advertises itself as a way to spread the cost of the latest brands and smartphones, is shelling out loans for milk and gas with cash-strapped customers looking for ways to cover basic necessities.

The American Bankers Association’s credit conditions index fell sharply, as economists foresaw dampening loan demand. The weaker outlook lines up with major bank CEOs’ increased worries over a possible recession.

A 2019 state law limits annual interest rates on many loans to 36%, but some high-cost lenders have found a way to continue operating in California by partnering with banks. Now Democratic legislators want the Federal Deposit Insurance Corp. to take action.

Consumer Financial Protection Bureau Director Rohit Chopra is pushing the envelope of the bureau's power and jurisdiction in untested ways. More companies are disputing the CFPB’s allegations, refusing to pay large fines or admit wrongdoing, and vowing to defend themselves in court. 

GradFin offers advisory services to Americans who want assistance with their student loans. The acquisition is part of the Cleveland bank’s strategy of adding niche digital businesses.