Tag: Payday Loans

DENVER -- After four hours of testimony and deliberation in the old Supreme Court chambers of the state Capitol, First Assistant Attorney General Laura...

DENVER-- On Friday the state Senate passed a compromise version of Rep. Mark Ferrandino's payday loan bill, which seeks to protect consumers against high interest rates and fees. Lawmakers fearing job-loss forecasts put forward by short-term loan industry softened the strictest limits the original version of the bill would have put in place. Ferrandino is confident the amended bill will pass in the House and head to the governor's desk for signing this week.

As Colorado lawmakers wrangle over whether or not to regulate "payday loans" in the state, national mainstream banks are increasingly offering similar products-- short-term, high-interest loans secured by a pending paycheck. That's a bad thing, according to a consumer group that called on the Office of the Comptroller of the Currency to stop the practice.

For six hours Monday in the packed Old Supreme Court Chambers of the Capitol before the House judiciary committee, lawmakers and lenders and borrowers...

The Credit Card Accountability Responsibility and Disclosure Act, dubbed simply the "Credit Card Bill of Rights," was backed by the President and was written to protect consumers from abuses that have come to define the credit card industry. The Act went into effect Monday. Unless you have a perfect credit score, however, the law might not do anything to help you borrow extra cash at a fair rate anytime soon.

The payday loan industry gouges Coloradans like it does Americans across the country, targeting mostly low-income single women, including military spouses. Denver Democratic state Rep. Mark Ferrandino tried and failed to introduce legislation in 2008 that would have curbed the worst of the abuses, where desperate borrowers take loans at hundreds of percent interest and enter a debt cycle they rarely are able to exit. Ferrandino may try it again this year.

Stung by losses in states that either refused to authorize its high-rate, short-term loans or moved to limit finance charges, the payday lending industry isn’t giving up without a fight. Its lobbyists are pressing hard in states where it sees opportunity to stave off reform, including Colorado, site of a major coming battle, where lenders are already making financial contributions to minority groups to win favor.

Consumer protection shortfalls are not limited to messy subprime mortgages. Lagan Sebert and David Murdoch detail the payday loan industry's continued assault on U.S. consumers for the American News Project. By offering small loans, typically in amounts ranging from a few hundred to a few thousand dollars, payday lenders target consumers who need money for basic necessities, then charge them outrageous interest rates (as in, above 700%).