Payday Lending News
The latest news on payday loans and the payday lending industry from the Center for Responsible Lending.
- New York Subpoenas Websites in an Effort to Curb Payday Lenders
New York Times 03 Dec 2013
New York Superintendent of Financial Services Benjamin Lawsky recently sent subpoenas to 16 lead generator websites that sell sensitive consumer data to payday lenders to gather information about the websites' practices and connections to the lenders. This comes after Lawsky sent cease-and-desist letters in August to 35 online lenders for writing loans that violate state usury caps.
- Pay Day Lending – Ending a Vicious Cycle
Houston Chronicle 02 Dec 2013
The mayor of Houston, Texas, is pushing for a payday lending ordinance that would restrain and regulate these types of lenders in the city. Such businesses often take advantage of the poor and vulnerable to generate large profits, writes Mustafa Tameez in an editorial.
- Decatur Wants to Tighten Restrictions on Payday Lenders
WAFF.com (Alabama) 02 Dec 2013
The City Council in Decatur, Ala., is considering a zoning ordinance that would limit where payday lenders can set up shop. It also has drafted a resolution calling on lawmakers to cap payday loan interest rates, which often top 200 percent or even 400 percent on an annualized basis, and continues to push for legislation at the state level that would require lenders to report loans to a database to ensure compliance with the $500 limit.
- Ditching Compromise, Parker Pushes Tough Payday Loan Regulations
Hispanic Business 23 Nov 2013
Houston Mayor Annise Parker has thrown out a compromise plan to regulate payday and auto title lenders, instead promoting stricter measures to limit this type of financing. The city council will vote next month on the regulations, modeled on rules passed by other Texas cities that include Dallas, Austin, San Antonio, and El Paso
- Service Members Left Vulnerable to Payday Loans
New York Times DealBook Blog 22 Nov 2013
The Military Lending Act was enacted nearly seven years ago, but some say it has gaps that leave hundreds of thousands of U.S. service members open to potentially predatory loans. Congress passed the law to shield service members from loans with double-digit interest rates that can get borrowers deep into debt. Critics, however, say the law has not kept up with high-interest lenders that operate either online or near bases.
- Payday Lender Cash America Fined Over Claims of Robo-Signing, Gouging Military Members
Washington Pos 21 Nov 2013
The Consumer Financial Protection Bureau (CFPB) has reached a $19 million settlement with payday lender Cash America over abusive practices such as "robo-signing," in which employees stamped a lawyer’s signature on court documents used to sue borrowers for past-due debts. This tactic, according to the CFPB, helped the company improperly make money from at least 14,397 U.S. consumers. The settlement with Cash America is the CFPB's first with a short-term, small-dollar lender. The agency also found cases in which Cash America charged active-duty service members and their families more than the 36 percent interest rate limit set by the Military Lending Act.
- Fresno Pushes Payday Loan Limits, Critics Stress Financial Dangers
ABC - KFSN Fresno (CA) 21 Nov 2013
There are 66 payday lenders already licensed to do business in Fresno, Calif., so officials there are taking steps to check the local growth of such companies -- which state regulators say charge annual interest rates of about 460 percent.
- Senate Aging Committee Launches Anti-Fraud Hotline for Seniors
Reverse Mortgage Daily 20 Nov 2013
The U.S. Senate Special Committee on Aging recently went live a new anti-fraud hotline that older Americans can contact if they believe they have fallen prey to a financial scam. The toll-free number will put callers in touch with committee investigators who can hear their complaints about payday loans, identity theft, bogus sweepstakes and lottery schemes, abusive reverse mortgage deals, investment scams, Social Security and Medicare fraud, and other elder financial abuse problems.
- Jay Blasts 'Scumbags' Who Prey on Veterans
Charleston Gazette (West Virginia) 20 Nov 2013
Because they are at high risk of predatory or fraudulent lending and debt collection, enlisted persons should be wary of high-pressure sales, said witnesses at a U.S. Senate Commerce Committee hearing on Nov. 20. Sen. Jay Rockefeller (D-W.Va.) called the meeting to address why military members have higher credit card debt and why they are more likely to use high-interest loans such as payday lenders.
- Markey Introduces Bill to Protect Troops From Predatory Lenders
Hispanic Business 20 Nov 2013
Enlisted persons and their families are three times as likely as civilian households to turn to predatory payday loans when in financial distress and also are more likely to carry heavy credit card debt, but new legislation promises to give them alternative choices. The Military Savings Act, introduced Nov. 20 by Sen. Edward Markey (D-Mass.), creates a pilot program under which financial institutions on base offer innovative products to help members of the Armed Services and their families get on more stable financial ground.
- Tennessee Regulators to Back Off Some Payday Lenders
Nashville Business Journal 18 Nov 2013
Payday lenders in good standing with the Tennessee Department of Financial Institutions will enjoy a larger gap between inspections, according to WPLN Nashville Public Radio.
- Reining in Payday Lenders
New York Times 17 Nov 2013
Earlier this month, the Consumer Financial Protection Bureau (CFPB) announced that it will start to collect complaints from borrowers who may have experienced unreasonable fees, unauthorized withdrawals from their checking accounts, or other abuses from payday lenders.
- State Puts Brakes on Online Lender
Coeur d'Alene Press 13 Nov 2013
Financial regulators in Idaho have imposed a cease-and-desist order against AAA Payday Advance, an online lender that is based in Utah and has no license to do business in Idaho. Violation of the licensing requirements renders payday and other consumer loans void, uncollectable, and unenforceable, according to Idaho Department of Finance director Gavin Gee.
- AARP Looks to Legislate Payday Loans
The Advocate (LA) 12 Nov 2013
The AARP is preparing to propose legislation that would limit the long-term interest rates for “payday” loans in Louisiana, after a survey found support for this effort among 60 percent of voting-age state residents.
- Faith Groups Urge Stricter Rules on Payday Loans
Minneapolis Star Tribune 12 Nov 2013
The Joint Religious Legislative Coalition has released a report calling for a broad new crackdown on payday lending in Minnesota, arguing that current limits on the industry are inadequate.
- Here’s How Veterans Are Being Targeted for Crippling Loans
Care2 11 Nov 2013
Although the nation's former enlisted personnel can receive a variety of benefits through the Veterans Administration (VA), many find themselves the targets of exploitative lending practices in the financial sector, such as bait-and-switch loan terms and 400 percent interest rates.
- Louisiana Advocacy Group Seeks Limits on Payday Loan
The Advertiser (LA) 11 Nov 2013
Many consumers who take out a payday loan are put into even worse circumstances when forced to pay back more than they borrowed, according to David Gray, a policy analyst for the Louisiana Budget Project.
- Fight Against Illegal Payday Loans Turns to Banks
Minneapolis Star Tribune (MN) 09 Nov 2013
Regulators and lawmakers have long been attempting to limit payday loans, but the struggle is moving away from the companies that offer the loans and in the direction of the mainstream financial institutions that help process them. New Jersey borrower Angel L. Gordon, for example, has filed a potential class-action lawsuit against U.S. Bank for its role in processing allegedly illegal loans that she obtained last year from online lender National Opportunities Unlimited Inc. Gordon spent $1,814 over 10 weeks to repay an $800 advance.