|
How much is too much for a payday loan ?
February 2. 2008
The legislative battle over those so-called payday loans is heating up. Several bills seeking to reform the industry are set for debate in the General Assembly next week: first, in the Senate and then, the House.
The debate over payday loans is the debate over how much Virginia residents should pay to borrow anywhere between $100 and $500.
In Virginia, thousands use payday loans. The cost by law in Virginia: $15 to borrow $100 over a two week period. But, for the second time in two years, some lawmakers have proposed a 36-percent cap on the interest you'd pay to borrow that money. That would make that same $100 loan cost only a $1.38. The payday industry claims that would force the industry out of Virginia.
Del. John O’Bannon, R-Henrico says, “The world's not going to end if we put some limits on this industry to make it better.”
Delegate Lee Ware, R-Powhatan, has proposed reform that limits the number of loans you could have at one time. But, it doesn't adjust the fee to borrow the money. Del. Ware says, “Mine recognizes that an APR on a 15 day loan is an inaccurate way of even looking at it. It's a fee. A $15 fee.”
We'd heard negotiations on this issue broke down last week. Sources now say Monday could be a pivotal day for negotiations.
By Rob Richardson, NBC12 News
Source
http://www.nbc12.com/news/state/15115446.html
|
