In 1998, however, Self-Help's leaders realized their good work was being undercut by predatory mortgage lending practices that were "stripping" the equity out of borrowers' homes. Thus was born the Coalition for Responsible Lending, which fought for and won the nation's first anti-predatory lending bill in North Carolina. Soon, as other states asked how they did that, the coalition became the Center for Responsible Lending, now an organization with 45 employees offices in Washington, D.C., as well as in Durham, and funding from major sources like the Ford Foundation, the Annie B. Casey Foundation and the Z. Smith Reynolds Foundation.
CRL President Mark Pearce estimates that predatory mortgage lending practices cost homeowners some $9 billion a year. But predatory payday lending is right behind, he says, extracting an estimated $5-6 billion a year from unwary borrowers. "With minority and low-wealth families losing $16 billion of wealth each year, predatory financial practices have become the single-most imminent threat to minority wealth in America. We must act quickly or we will lose the last 25 years of economic advancement by these families," CRL says.