Introduction
The results of the 2024 national and local elections guide Woodstock Institute’s efforts in two distinct ways—mitigating harm and connecting more directly with low- and moderate-income communities, including communities of color. Woodstock Institute’s work will continue to be relevant in the day-to-day lives of our constituents—access to capital, combatting financial exclusion, reducing financial exploitation, and wealth preservation and/or growth. The following are our main priorities for 2025:
Research
Community Lending Data Portals
Woodstock Institute’s Community Lending Data Portals continue to evolve. We will use feedback from current and past stakeholders to further understand user experience, program outcomes, and community lending research needs to update the Chicago/Illinois Community Lending Data Portal. These upgrades may include visualizations, additional data points, or other graphics.
We will expand Community Lending Data Portals for Housing Opportunities Made Equal in Cincinnati, Ohio, and the Metropolitan Milwaukee Fair Housing Council in Wisconsin, as well as update the Fair Housing Center of Central Indiana’s portal.
Community Lending Data Capacity Workshops
The goal of Woodstock’s data capacity workshops is to “democratize” home mortgage and small business lending data and provide data analysis training to community stakeholders. Through connecting community-based organizations with the necessary tools to evaluate financial equity in their areas, they can identify the specific interventions, services, and programs to address neighborhood needs.
The workshops will enable us to attract, recruit, and retain a network of community members who will serve as our bridge to the community, while we serve as their community lending researchers and advocates. Through these partnerships, we can collect stories and case studies that reinforce community assessments, support our research and policy work as well as to develop long-term connections with, and commitments to, enhancing the impact of community organizations.
Research Reports, Articles, & Publications
Woodstock Institute will provide Home Mortgage Disclosure Act (HMDA) and Community Reinvestment Act (CRA) analysis. This may include the impact of the COVID-19 pandemic, lending trends, policy implications, or other data points. We will also publish resources to support the use of the Community Lending Data Portal, community fair lending analysis, and new economic justice and racial equity research.
Home Mortgage Disclosure Act Analysis
Woodstock expects that the Federal Financial Institutions Examination Council, the US Department of Housing & Urban Development, and the Department of Justice’s enforcement of anti-discrimination laws like redlining, fair lending, fair housing, equal credit opportunity, and the CRA will not be as aggressive. As it relates to the City of Chicago, the State of Illinois, and the Midwest, Woodstock Institute will step in and compensate by increasing our focus on Home Mortgage Disclosure Act analysis, bank branch locations, and other redlining or fair lending analysis.
Financial Services Industry
Given the dynamic nature of the financial industry ranging from consolidation in the banking sector, financial technology and/or crypto-currency companies attempting to start or purchase banks, and more credit unions acquiring community banks, Woodstock Institute will:
- Monitor regulatory reports, press releases and media announcements regarding branch openings, closures, or changes in financial institution ownership due to a merger or acquisition
- Assess which applications require our attention based on a combination of factors including, but not limited to, the population and community being served by the institution, its branch distribution, product offerings, lending performance, access to other financial institutions within the same community, and its performance with consumer protection and anti-discrimination laws
- Deploy the research and policy resources necessary to engage when data and our analysis shows a harmful community impact including, but not limited to, direct outreach to financial institutions and their regulatory agencies, protested applications when applicable, publication of findings in relevant media, and the mobilization of community organizations and/or elected officials in public and visible campaigns when justified
Legislative Policy
Small Business Financing Transparency
Woodstock Institute is a leading member of the Coalition for Small Business Lending Transparency (CSBLT). The CSBLT has nearly succeeded in passing its bill out of both houses of the legislature. The bill would:
- Register/license non-bank small business lenders at the state level
- Require disclosures to small business borrowers, similar to the Truth in Lending Act, so they can make a apples-to-apples comparisons between loan products and make informed decisions about their business finances (banks and credit unions, which are already subject to substantial regulation, would be exempt from the requirements of the bill.)
- Require “Sales-Based Financing Companies,” which set repayment schedules based on borrowers’ sales, to report data to the state regulator (In the wake of the 2008 financial crisis, the Dodd-Frank Act (2010) required the Consumer Financial Protection Bureau (CFPB) to develop rules requiring all lenders to small
businesses to report data to the CFPB. Those rules have been delayed for a panoply of reasons. This makes the data collection provisions of our bill extremely significant.)
In 2024, the Small Business Financing Transparency bill passed out of the State Senate but stalled, once again, in the House. We are hopeful that by organizing small businesses across the state and lifting up the voices of those impacted by predatory small business loans, we can win this campaign. To this end, we are holding a strategic planning summit with our close coalition partners to develop a roadmap that will take us across the finish line by May 2026. We expect this roadmap to include a Small Business Financing Conference in late summer 2025 and three town hall meetings in strategically determined districts in Illinois by the end of 2025.
Protect the Predatory Loan Prevention Act (PLPA)
Woodstock Institute will continue its active diligence to eliminate legislative threats by the predatory lending industry that aims to weaken the Predatory Loan Prevention Act. We will continue to:
- Collect stories from impacted consumers and disseminate data showing the positive impacts of the state’s 36% rate cap
- Advocate for the state to take action to stop predatory lenders who are evading the Illinois rate cap by partnering with out-of-state banks and by using arbitration clauses that contain “choice of law” provisions that import into Illinois the laws of other states that have weak consumer protection laws.
- Work with responsible lenders to educate the public about safe and affordable financial products. This includes, for example, conducting outreach at events, such as the Chicago Urban League’s Back to School Fest, and the dissemination of our Resource Guide through WeProsperIL.org.
Other Legislative Policy Priorities
We are actively involved in and/or monitoring legislative/policy developments in the following areas:
- Instituting a Mini CFPB, which would create a state version of the Consumer Financial Protection Bureau and/or broadening the powers of the existing Illinois Department of Financial & Professional Regulation
- Cryptocurrency Regulation
- Debt Collection, including so-called “Kill Switches”
- Credit Repair and Debt Settlement
- Car Insurance Reform, including a ban on the use of non-driving factors in setting rates
- Protections for Student Borrowers
Regulatory Policy
Mortgage Access Initiative
In 2022, Neighborhood Housing Services of Chicago and Woodstock Institute began the Mortgage Access Initiative (MAI), convening representatives from various mortgage lenders (banks, credit unions and mortgage companies) to share their expertise on the mortgage process and reimagine it through pragmatic industry, policy and regulatory recommendations. The first phase focused on lender practices by creating a detailed process map that identified intersection points with other important stakeholders, e.g. appraisers, real estate professionals, and the government-sponsored enterprises (e.g. Fannie Mae and Freddie Mac). Phase 1 concluded with three primary recommendations:
- Create a realistically achievable equitable lending product
- Ensure Federal Housing Administration (FHA) loans only go to borrowers who are ineligible for conventional/conforming loan products
- Address loan officer compensation structure and optimize relationships with housing counselors.
Phase 2 of the MAI will have a different structure due to its focus on the real estate industry. We will work with partners to identify experienced and diverse real estate professionals to participate in one-on-one interviews focused on creating better outcomes for low- and moderate-income (LMI) and borrowers of color. Like Phase 1, recommendations resulting from these stakeholder meetings will be released in a report presentation and press conference.
Training and Implementation of the Illinois Community Reinvestment Act
In partnership with Housing Action Illinois and IDFPR, Woodstock Institute will continuously coordinate and conduct Illinois-CRA training for financial institutions and non-profit organizations throughout the state that are covered by the law, individually or in conference settings. We will create training materials, guides, and videos, and make them accessible via the internet.
Stop Predatory “Rent-A-Bank” Lending
We will continue oppose “Rent-a-Bank” efforts by predatory lenders that partner with out-of-state banks to utilize that state’s interest rates, thereby illegally circumventing the Illinois Predatory Loan Prevention Act’s 36% APR cap on consumer loans. Our strategy will be determined by the nature of the threat, ranging from legislative, judicial, research, and/or media-focused initiatives.
Small Dollar Loan Initiative
In support of our work addressing the predatory lending industry in Illinois and inequitable access to traditional banking products for LMI individuals, our Small Dollar Loan Solutions initiative is a partnership with the Corporate Coalition of Chicago, which aims to ensure that LMI individuals who need emergency cash can access small dollar credit without harming their long-term financial stability. Our work will include the following activities:
- Assess existing products offered by traditional banks as well as additional fintech and earned wage access products
- Convene a recurring roundtable of for-profit and non-profit lenders to reimagine the small-dollar loan product and process for LMI borrowers and consumers of color
- Conduct market-sizing analysis across customer segments
- Evaluate and score each product to understand which ones are good, moderate, and weak
- Research trends, gaps, and relevant issues
- Identify policy, regulatory, market or third-party influence issues
- Work with financial institutions (both for-profit and non-profit) to fill financial product and service gaps and conduct outreach to educate/provide resources for consumers on alternatives to predatory loans
- Develop recommendations to shift consumers toward products that provide them with needed access to credit without degrading their financial future
- Work with employers to expand their offering of benefits to include safe and responsible small dollar credit to their employees directly or through partnerships with responsible third-party service providers
