Payday Lending News
The latest news on payday loans and the payday lending industry from the Center for Responsible Lending.
- Lac du Flambeau Chippewa Enter Payday Loan Business With Eye to Online Gambling
Milwaukee-Wisconsin Journal Sentinel 29 Dec 2013
About two dozen Native American tribes have launched short-term online lending operations and are also considering online gaming. Barry Brandon, executive director of the Native American Financial Services Association, says that some of the legal and political battles that tribes fought over Indian casinos are now being fought over online lending.
- TIOR Capital Agrees to Forfeit $1M in Outstanding Loans
Riverside Press-Enterprise (CA) 26 Dec 2013
Authorities in California have reached a settlement with TIOR Capital, which offered unlicensed payday loans online to consumers across the state through its Nevada-based affiliates.
- Predatory Lenders Skirting Arizona's Payday Loan Law
Azcentral.com 19 Dec 2013
Arizona voters banned payday lenders in 2008, but some predatory lenders have been able to dodge the law and persist in their harmful credit practices, writes Rep. Debbie McCune Davis, a Democrat who represents Legislative District 30. Consumers in the state continue to be targeted by auto title lenders that charge triple-digit annual interest and claim to offer a quick financial fix that can actually evolve into a long-term financial problem.
- Caldwell ID Approves Tighter Restrictions on Payday Lenders
Boise Weekly 17 Dec 2013
An ordinance stipulating where payday loan operations can set up shop in Caldwell, Idaho, has sailed through a city council vote with no objections. Under the measure, the businesses will be limited to manufacturing or light industrial zones and banished from commercial areas.
- Federal Consumer Agency Sues Over Online Loans
New York Times 17 Dec 2013
On Dec. 16, the Consumer Financial Protection Bureau (CFPB) sued online loan servicer CashCall Inc., two related companies, and owner J. Paul Reddam to stop them from demanding payment for costly loans. The servicer managed loans that came with terms that often included triple-digit interest rates.
- Loan Amounts Can Snowball When Payday Lenders Sue Borrowers
St. Louis Post-Dispatch 14 Dec 2013
Lenders that make payday, auto title, and installment loans file suits against customers for non-payment tens of thousands of times annually. In Missouri alone, these lenders file more than 9,000 suits a year, according to an analysis by ProPublica. The court system is often biased on the lenders' side, making litigation profitable for them and increasing the costs for borrowers. These loans come with annual interest rates that range from about 30 percent to 400 percent or more. In some states, after a suit results in a judgment, the debt can continue to add up at a high interest rate.
- 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.
- 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.
- 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.
- 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.
- 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.
- The Dangers of Online Lending
U.S. News & World Report 22 Oct 2013
Although regulators and consumer advocates have worked for years to curtail payday lending, more and more firms are moving the business to the Web -- raising new policy challenges and threatening consumer protections at the state level, writes Tom Feltner of the Consumer Federation of America.
- States Sharpen Payday-Loan Scrutiny
Wall Street Journal 26 Sep 2013
State regulators are trying to rein in payday loans by pressuring lenders to submit customer information to state databases. Alabama became the most recent state to call for a database, following similar proposals in California, Pennsylvania, and other areas.
- FDIC Accused of Waging Stealth Crackdown on Online Lenders
American Banker 23 Sep 2013
The Federal Deposit Insurance Corp. has been ramping up reviews of banks' third-party relationships just as some online lenders, which rely on banks to process their transactions, are facing serious questions about their exorbitant interest rates and their liability under state licensing laws.