Payday Lending News
The latest news on payday loans and the payday lending industry from the Center for Responsible Lending.
- Both Sides in Payday Loan Debate Start Petitions
Springfield News-Leader (Missouri) 14 Aug 2013
Critics and proponents of payday lending in Missouri will see a contentious 18 months as each side attempts to put constitutional amendments on the ballot.
- Two Banks' Payday-Advance Lending Draws Scrutiny
Orlando Sentinel (FL) 14 Aug 2013
Regions Bank and Fifth Third Bank, two of Florida's largest banks, are drawing criticism from consumer groups after entering the payday-advance business. Like just a few others in the United States, they now offer a type of short-term, high-cost loan that is commonly associated with payday lending. Critics say these loans' steep interest and fees can draw consumers into a dangerous "debt trap."
- New York AG Sues Online Payday Lenders
American Banker 13 Aug 2013
New York Attorney General Eric Schneiderman filed suit Aug. 12 against a trio of online lenders and their owners, which he claims violated usury laws by issuing loans bearing annual interest rates of as much as 335 percent.
- Indian Tribes Oppose New York Order on Online Lenders
Wall Street Journal 12 Aug 2013
Benjamin M. Lawsky, superintendent of New York's Department of Financial Services, has launched an effort to shut down tribal lenders' online operations, but Indian tribes argue that the state lacks authority to do so.
- New York Scrutinizes Online Lenders
Wall Street Journal 06 Aug 2013
Benjamin Lawsky, superintendent of the New York Department of Financial Services, has issued 35 cease-and-desist orders to online firms that he believes might be dodging state laws prohibiting lenders from charging egregious interest rates.
- Rules Grow, But Profits for Payday Lenders Soar
Toledo Blade 06 Aug 2013
Although Ohio lawmakers abolished high-cost loans in 2008, many payday loan stores still operate in the state -- some charging annual percentage rates (APRs) up to 700 percent. Lenders often exploit loopholes in the law, or react to laws against one type of loan by offering "second generation" products that still feature triple-digit APRs.
- How One State Succeeded in Restricting Payday Loans
ProPublica 06 Aug 2013
Washington state legislators in 2009 passed a law blocking borrowers from taking out more than eight payday loans in a single year, and that statute has served as a model for Delaware and other states.
- Check ‘n Go Refunds to Be Mailed This Week
San Francisco Chronicle 05 Aug 2013
More than 2,000 Californians will receive checks from payday lender Check ‘n Go after San Francisco City Attorney Dennis Herrera sued the company in 2007 for loaning money at unlawful interest rates.
- State Needs More Regulation of Payday Loans
Iowa City Press-Citizen 03 Aug 2013
More cities in Iowa are using zoning authority to restrict payday loan businesses within their borders, but such efforts have only limited effect on the industry without statewide legislation. Iowa City's ordinance, which confines delayed-deposit service businesses to community commercial zones, effectively stopped new payday loan businesses from opening; but it does not affect the businesses that are already up and running.
- Cities Put Restrictions on Payday Loan Shops
Des Moines Register 31 Jul 2013
Despite calls from cities and consumer groups, the Iowa Legislature has not yet capped interest rates on payday loans or attempted to prohibit the businesses from operating. Cities in Iowa are resorting to local restrictions on the industry, with Windsor Heights in July becoming the seventh city in the state to pass an ordinance restricting where the lenders can set up shop.
- No New Payday Lenders Have Opened in Iowa City Since September
Iowa City Press-Citizen 30 Jul 2013
Payday lending restrictions in Iowa City have stopped the industry from expanding, but some want to crack down on the industry even further. The Iowa City Council last year passed restrictions about where new delayed-deposit services can locate: at least 1,000 feet from churches, parks, schools, a residence, or another payday lender.
- Georgia Whacks Payday Lenders in Court
Courthouse News Service 29 Jul 2013
The Georgia attorney general's office is suing payday lenders Western Sky Financial and CashCall in Fulton County Superior Court. The entities are accused of illegally taking money from customer's bank accounts and using obscene language, threats, and phone calls "at all hours" to pursue collection on debts.
- Seniors Fastest-Growing Segment of Payday Borrowers, Senate Told
Credit Union Times 25 Jul 2013
Rebecca Bornè, senior policy counsel for the Center for Responsible Lending (CRL), on July 24 told the Senate Special Committee on Aging that older Americans are a rapidly growing proportion of payday borrowers. Several factors make seniors attractive customers: most older Americans have regular Social Security income, and many experienced hardship in the financial crisis and housing downturn. In both Florida and California, about one in five payday borrowers is 55 or older.
- Senator Presses Consumer Bureau on Installment Lender World Finance
ProPublica 25 Jul 2013
The Senate Special Committee on Aging held a July 24 hearing that examined how high-cost financial products such as payday loans affect seniors. Sen. Ron Wyden (D-Ore.) questioned a top official from the Consumer Financial Protection Bureau (CFPB) on how to address and prevent abuses by installment lenders.
- Cover Story: Loosely Regulated Loan Centers Flourish
Sioux Falls Business Journal 24 Jul 2013
With the tightening of lending regulations came the spawn of new business in the alternative financial services space -- which includes payday lenders, auto title lenders, and pawn shops.
- ‘Unbanked’ Minnesotans Hurt Most by Predatory Lending
MinnPost.com (MN) 24 Jul 2013
More than 360,000 Minnesota households that are “unbanked” or “underbanked” do not have access to reasonably priced, basic financial services, according to a 2011 survey by the Federal Deposit Insurance Corporation.
- Faith Based Group Calls for Cap on Fresno Payday Lenders
Valley Public Radio (California) 23 Jul 2013
Almost 12 million Americans use payday loans each year, but many of them are unable to repay them on time. A new Pew Research Center study found that only 14 percent of borrowers can afford to repay an average payday loan of $400, while 27 percent ultimately incur bank account overdraft fees.
- Payday Lenders Covered by FTC Act Even If Affiliated With American Indian Tribes
Yuma News Now (AZ) 22 Jul 2013
As part of a recent challenge by the FTC over what it says are illegal business practices by a payday lending outfit with an American Indian tribal affiliation, a U.S. magistrate judge has issued a report clarifying the agency's authority to file suit against Native American tribes as well as their employees and contractors.