Oregon

Payday lenders charge exorbitant fees to borrowers without assessing their ability to repay, and the annual interest rates on these loans are in the triple digits.

A few high-cost lenders are evading state consumer protections through rent-a-bank schemes. Through these sham arrangements, these companies are exploding right through the interest rate limits that most states have put in place for good reason, to protect people from high-cost debt traps that drain them of their hard-earned income. In the following states, payday lenders are using banks, which aren’t generally subject to state interest rate caps, to make usurious loans that exceed the state’s rate cap. The banks engaging in these schemes are abusing their charters and enabling predatory loans...

This written testimony focuses on three key areas of concern in support of HB 2588 to protect Oregonians from abusive practices by student education loan servicers: Oregon’s student loan debt crisis deepens the racial wealth gap and harms older Oregonians Abuses by student loan servicers prolong and deepen the student loan debt crisis, further increasing the racial wealth gap and harm to older Oregonians The federal rollback of existing protections bolsters need for state action Download the complete testimony. (PDF)

By the Stop the Debt Trap Alliance of Oregon, in partnership with the Center for Responsible Lending (CRL) In 2006, when Oregonians noticed the devastating impact payday and car-title lending was having on their communities, a coalition pushed for a change in the state laws, bringing new consumer protections to hundreds of thousands of people in the state. This example shows the power of communities to make change on issues affecting the day-to-day lives of people in Oregon. Today, community organizations are once again coming together to continue improving the marketplace and economic...

In recent decades, an increase in consumer debt has led to substantial growth in the debt collection industry as Americans struggled to pay down their debts. A subset of the debt collection industry, debt buyers, emerged in the wake of this growth in consumer debt. Debt buyers purchase debts from lenders and other creditors at a steep discount and then attempt to collect the debt themselves, often without the underlying documentation of the debt. With the advent and growth of debt buyers has come an increase in the use of litigation to collect debts. Because of their use of the court system to...

Payday and car title loans are small-dollar, high-cost products that thrive on keeping consumers in a cycle of debt. With lenders doing essentially no underwriting, consumers find it easy to obtain these loans, often marketed as a solution to financial emergency. However, the unaffordability of the loan and the lenders extreme leverage over the borrowers – either through direct access to the bank account or threatening repossession of the borrower’s car - makes it very difficult to escape a cycle of debt that can last months, if not years. Debt trap products often lead to other financial harms...

Payday and car-title loans typically carry annual percentage rates (APR) of at least 300%. These high-cost loans are marketed as quick solutions to a financial emergency. Research demonstrates, however, that they frequently lead to debt that is nearly impossible to escape. In addition, these loans are related to a cascade of other financial consequences, such as increased overdraft fees, delinquency on other bills, involuntary loss of bank accounts, and even bankruptcy. For car-title loans, the end result is too often the repossession of the borrower’s car, a critical asset for many people...

This color-coded map of payday stores by household reveals a disturbing pattern. Southern states are among the most targeted for these high-cost, low-dollar loans.