In light of our current debt-fueled economic crisis, Congress is looking at reforming one of the most predatory forms of lending—high-interest, short-term payday loans. But according to a range of consumer, community and civil rights groups the leading bill in Congress to deal with the issue, the Payday Loan Reform Act of 2009, would actually protect the “predatory payday loan business model and will stall or stop the significant progress that has been made at the state level to curb usurious lending.”
The section of the bill that has caught the attention of the payday loan reform advocates is 2(d), ironically entitled “Additional Protections for Consumers.” It reads:
It shall be unlawful for a payday lender to-
‘(1) require a consumer to pay interest and fees that, combined, total more than 15 cents for every dollar loaned in connection with a payday loan;
Upon first read, that doesn’t sound bad, but the groups that have come out against the bill explain that enders will be able to apply that rate for each pay cycle, meaning a 390 percent APR for typical payday loan borrowers.
Write You Representatives- Tell Them To Vote "NO"