California

Testimony by Paul Leonard from the May 6, 2015 Informational Hearing on the Consumer Financial Protection Bureau Rulemaking for Payday, Vehicle Title and Similar Loans before the California Senate Banking Committee. The CFPB aims to cover payday and similar loans under its rule regardless of the provider or channel offering the loans (storefront and online; bank/credit union, non-depository, tribal entity)...

CRL, The Public Good Law Center, and the National Association of Consumer Advocates filed an amicus brief supporting an appeal by plaintiffs asserting that loans made by the payday lender CashCall were unconscionable and violated California's Unfair Competition Law. Courts and the common law have long recognized that excessive interest rates and prices are unconscionable and therefore "unfair" and "unlawful."...

This case involves borrowers who purchased a vehicle through a dealership in California. The financial institution in question, Wachovia, did not make the loans, but later purchased the installment contracts from the dealer. When the borrower fell behind on their payments, Wachovia repossessed the cars without properly following California law. California allows self-help repossession, but has strict rules regarding consumers'...

California's Rees-Levering Act entitles car loan borrowers to receive information on the amount they must pay to recover their car when it is repossessed. This represents an important, and easy to satisfy, legal protection for car loan borrowers who otherwise may find it hard to determine the amount of payments and fees the lender claims are owed. U.S. Bank successfully...

Committee: California State Senate Banking, Finance & Insurance Committee

Committee: California State Assembly Banking and Finance Committee

SB 515 includes three principal reforms California payday loans: it caps the number of payday loans per borrower at four per year; extends the minimum term of a payday loan, so that borrowers will have more time to accumulate the amounts necessary to repay it; and requires all lenders to apply standardized underwriting guidelines to ensure that borrowers have a...

California payday loan borrowers get caught in a cycle of repeat borrowing of 459% Annual Percentage Rate (APR) loans. Reforms are necessary to ensure that payday loans serve their advertised purpose and better protect consumers. SB 515 proposes a series of reforms to allow payday loans to better serve their advertised purpose while making the loans safer for consumers. Read...

Payday Loans Create a Debt Trap. For California families living paycheck to paycheck, the high price of a payday loan and the fact that it must be paid off in one lump sum two short weeks later virtually ensures that cash-strapped borrowers will be unable to meet their basic expenses and pay off their loan with their next paycheck. Consequently...