Traditionally in the United States, electric and natural gas utility service has been billed on a post-paid basis where a utility company tracks a customer‘s usage during the previous monthly or quarterly period and then mails a bill to the customer based on that usage. The customer is then required to make payment within a…
The U.S. Treasury is seizing Earned Income Tax Credit (EITC) refund checks from the working poor to repay student loans that are in default, and the consequences on working families are devastating. The government’s policy of seizing federal student loan borrowers’ EITC runs counter to almost everygoal Congress set for the EITC1 and its student…
Year after year, the federal government seizes Earned Income Tax Credit (EITC) refund checks from the working poor to repay federal student loans that are in default, and the consequences for working families are devastating. Even this year, during a global pandemic and in the midst of record unemployment, the U.S. Department of Education has…
Tax-time is a critical moment for millions of Americans, providing much-needed funds in the form of billions in refunds. In particular, the Earned Income Tax Credit (EITC) helps 27 million families and is the largest anti-poverty program in the country. This year, these EITC recipients and many other taxpayers face new and old challenges in…
Refund anticipation loans (RALs) are usurious short-term loans secured by the taxpayer’s expected tax refund. About 12 million taxpayers took out RALs in 2004, costing them over $1 billion dollars in loan fees. This report documents a new form of RALs called “pay stub” and “holiday RALs.” Pay stub RALs are RALs made by tax…
Read More about Pay Stub and Holiday RALs: Faster, Costlier, Riskier in the Race to the Bottom
The use of credit scores in home and auto insurance is a poorly understood phenomenon with a huge economic impact on Americans. It’s also a practice that creates wide racial disparities. This report presents an overview of credit scores, which are three digit numbers designed to predict risk based on a consumer’s credit record. The…
Approximately 64 million consumers in the United States have no credit history or lack sufficient credit history to generate a credit score, cutting off access to traditional banking services. Finding a way of getting affordable access to credit is of vital importance to the economic well-being of this population. It also represents an untapped market…
Read More about Big Data, a Big Disappointment for Scoring Consumer Credit Risk
A research consultant has recently produced several reports promoting utility company reporting of all customer payment behaviors and transactions to the major consumer reporting agencies (CRAs). Proponents of full utility reporting contend that it is required to help “thin file” and “no file” consumers to build credit history and gain access to bank loans and…
Read More about Full Utility Credit Reporting: Risks to Low Income Consumers
The Massachusetts Low-Income Energy Affordability Network (LEAN) is an association of nonprofit agencies that coordinate the delivery of government and utility-funded energy efficiency services to low-income utility customers throughout Massachusetts. Since 1997, LEAN’s member agencies have delivered energy efficiency upgrades to more than 100,000 low-income Massachusetts households. Still, up to 200,000 low-income homes still need…
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