Post by Logan on Jun 9, 2016 0:40:50 GMT -6
A national plan to protect struggling families from high-interest payday loans that can trap them in debt sounds good, but it could be bad for Pennsylvania.
The state already has strong protections through a law that caps interest rates on small loans at about 24 percent. That's kept payday loan stores out of the state because loans aren't profitable enough here.
Federal regulations proposed last week by the Consumer Financial Protection Bureau are weaker. Those rules wouldn't preempt the state law, but consumer advocates fear they could undermine it by prompting legislators to loosen the state law to bring it in line with the national standard.
One state lawmaker already is citing the feds' plan as he seeks to legalize loans at interest rates up to 36 percent, possibly with fees on top of that.
Read more: www.mcall.com/news/local/watchdog/mc-payday-loans-law-pennsylvania-watchdog-20160608-column.html
The state already has strong protections through a law that caps interest rates on small loans at about 24 percent. That's kept payday loan stores out of the state because loans aren't profitable enough here.
Federal regulations proposed last week by the Consumer Financial Protection Bureau are weaker. Those rules wouldn't preempt the state law, but consumer advocates fear they could undermine it by prompting legislators to loosen the state law to bring it in line with the national standard.
One state lawmaker already is citing the feds' plan as he seeks to legalize loans at interest rates up to 36 percent, possibly with fees on top of that.
Read more: www.mcall.com/news/local/watchdog/mc-payday-loans-law-pennsylvania-watchdog-20160608-column.html