Law Commons^™

Predatory Structured Finance, Christopher L. Peterson

ExpressO

Predatory lending is a real, pervasive, and destructive problem as demonstrated by record settlements, jury awards, media exposes, and a large body of empirical scholarship. Currently the national debate over predatory mortgage lending is shifting to the controversial question of who should bear liability for predatory lending practices. In today’s subprime mortgage market, originators and brokers quickly assign home loans through a complex and opaque series of transactions involving as many as a dozen different strategically organized companies. Loans are typically transferred into large pools, and then income from those loans is “structured” to appeal to different types of investors. …

Better Than Cash? Global Proliferation Of Debit And Prepaid Cards And Consumer Protection Policy, Arnold S. Rosenberg

ExpressO

A global deluge of debit cards and prepaid cards – payment cards that do not require consumers to qualify for credit – is rapidly making electronic payment systems accessible to much of the world’s population that previously paid in cash for goods and services. The global proliferation of payment cards is fraught with both risk and promise for consumers.

The billions of people of low to moderate incomes who are being hurled from a cash economy into the era of electronic payments in emerging economies by the proliferation of debit and prepaid cards are particularly vulnerable to abuses by banks …

Subprime Standardization: How Rating Agencies Allow Predatory Lending To Flourish In The Secondary Mortgage Market, David J. Reiss

ExpressO

Predatory lending, the origination of loans with abusive terms to homeowners, is rampant in the subprime mortgage market. In the last few years, many states responded to this problem by enacting consumer protection laws. Large segments of the lending industry have opposed these laws. In large part because of these complaints, momentum is building on three fronts to standardize the operations of the subprime mortgage market.

First, federal regulators are preempting the application of these laws to a broad array of lending institutions and Congress is considering legislation to preempt their application to the remaining financial institutions that are still …

Finding The Contract In Contracts For Law, Forum, And Arbitration, William John Woodward

ExpressO

Contract provisions specifying the law or forum (either judicial or arbitration) have begun appearing in litigated cases, as businesses have pressed many courts for their enforcement against consumers. In at least some of the cases, enforcement of a choice of law provision results in the displacement of the consumer’s home state protection by the lesser consumer protection of the State of the form drafter’s choosing. This phenomenon raises serious problems of federalism and local control of consumer protection. But while considerable scholarly attention has been lavished on so-called “mandatory arbitration” in this context, much less has attempted to improve our …

Global Credit Card Use And Debt: Policy Issues And Regulatory Responses, Ronald J. Mann

ExpressO

The rise of card-based payments has transformed the landscape of payments in the last half century, from one dominated by government-supported paper-based payments to one dominated by wholly private systems. The rise of those payments presents a number of policy problems, the most serious of which is the empirically demonstrable likelihood that use of the cards contributes to an undue level of consumer credit and that borrowing on the cards contributes to a rise in the level of consumer bankruptcy. Although the existing pattern shows great variation from country to country, regulators should take no solace in those variations. Building …