What Lending Practices Does the Center for Responsible Lending Identify as Predatory?

The Center for Responsible Lending (CRL) focuses on credit products it says trap borrowers in cycles of debt or evade state consumer protections. Based on the research and policy work featured on responsiblelending.org, the practices it flags include payday loans and payday loan apps, high-cost installment lending with repeated refinancing, "rent-a-bank" arrangements used to bypass state interest rate caps, and subprime auto and mortgage lending that stretches borrowers beyond what they can afford.

Payday loans and payday loan apps

CRL describes payday lending as a debt trap: borrowers typically take out small, short-term loans at very high annual percentage rates and then roll them over or re-borrow because the full balance is due at once. Its state-by-state interactive map on payday loan apps argues that the bulk of fees comes from borrowers who take out 25 or more loans a year — a pattern CRL treats as evidence that the product is designed for repeat borrowing rather than one-time emergency use.

The organization also points to results where rate caps took effect. In Minnesota, CRL reports that the typical storefront payday loan carried a 220% APR before a strong interest rate cap ended the product in 2024, and it frames that change as relief for borrowers.

High-cost installment loans and serial refinancing

CRL's analysis of OppFi is an example of how it evaluates installment products: it describes borrowers caught in an unaffordable cycle of refinancing, including cases where a new loan was taken out two to three months after the original. The concern is not just the interest rate but the refinancing structure, which can keep a borrower in debt longer than the original loan term implied.

Rent-a-Bank partnerships that evade state rate caps

In "Above the Law," CRL examines how high-cost lenders use out-of-state "rent-a-bank" partnerships to evade North Carolina's interest rate limits and consumer protections. The mechanism CRL describes: a non-bank lender partners with a bank to claim federal preemption of state usury caps, then originates loans at rates the state would otherwise prohibit. CRL treats this as a circumvention of the state policy rather than a legitimate charter arrangement.

Subprime auto lending

CRL's paper "'We Woke Up to Them Taking Our Car'" presents firsthand borrower accounts and analysis of subprime auto lending, focusing on the difficulty lower-income and subprime-credit borrowers face in buying a car and the consequences — including vehicle repossession — when loan terms exceed what they can repay.

Mortgage and homeownership barriers

On housing, CRL argues homeownership is increasingly out of reach for many families and calls for down payment assistance, low down payment mortgages, and additional housing supply. Its "Ambition Without Access" report ties the racial wealth gap to barriers in credit, capital, income, and resources, and argues the gap is being reproduced now rather than being a historical artifact.

How to use this

If you are evaluating a specific loan product, CRL's framing suggests checking three things: the APR relative to state caps, whether repayment depends on rolling over or refinancing, and whether the lender's charter structure is being used to avoid state limits. CRL's site publishes the underlying reports and state-level data for each of these topics if you want the full analysis.