Industry to fight payday loan limits
April 22, 2006 - Salem, Oregon
Consumer activists scored a victory this week when they persuaded the Oregon Legislature to cap interest rates that lenders may charge for short-term payday loans.
However, the regulations don't take effect until July 2007, and payday loan industry representatives are planning to return to the Legislature next January to try to overturn the law they say will destroy a growing industry that provides a popular service.
Payday loan industry spokesman Mark Thompson said the regulations passed in Thursday's special session mainly because the loans had become "a very politicized issue in an election year."
"Our hope is that once the election passes, we will be able to revisit this with legislators with more thorough arguments and facts" when the 2007 Legislature convenes in January, Thompson said in an interview on Friday.
Consumer advocates, on the other hand, are prepared to defend the new law that they say will reduce "predatory" lending practices.
"We will be back next legislative session, too, to make sure that not one word of the reform act is changed," said Patty Wentz of the Our Oregon coalition.
The new state law mirrors a proposed initiative measure backed by the Our Oregon coalition. It limits annual interest to 36 percent, sets minimum loan periods at 31 days, bars lenders from making more than two rollovers or making new loans within seven days of a previous loan, and limits the fee on a bad check to $20.
Thompson said the new law will force out of business many payday loan shops which now are the only source of small, short-term cash advances for people with financial emergencies.
The Register-Guard, Brad Cain, AP Reporter
Related Stories - Oregon
- 'Dan Rather Reports' criticizes payday loan industry [November 23, 2006]
- Payday loan limits are long past due [November 22, 2006]
- Oregon: Report sparks interest in tightening payday loan rules [November 21, 2006]
- State promoting alternatives to payday loans [August 11, 2006]
- Keizer will await 2007 payday-loan law [August 9, 2006]
- Oregon Governor promotes ... payday loan alternatives [July 28, 2006]
- An unjust assault on payday loan industry [July 7, 2006]
- We owe more thought to payday loan issue [July 6, 2006]
- Payday lenders look for ways around cap [July 2, 2006]
- Oregon City officials look to set limits on payday loans [June 7, 2006]
- Keep lid on payday loans [May 20, 2006]
- Industry to fight payday loan limits [April 22, 2006]
- Motivations questioned in payday-loan vote [April 21, 2006]
- Payday loan regulations win final approval [April 20, 2006]
- Payday loan reform heats up [April 19, 2006]
- Group asks for strong payday loan law or nothing at all [April 13, 2006]
- Payday loans under fire for high interest charges [April 12, 2006]
- Loans that come easy can go bad fast [March 24, 2006]
- Reformers take aim at payday loan rates [February 28, 2006]
- Catholic leaders call payday loan outfits 'predatory' ... [January 19, 2006]
- Witnesses call for lending limits [January 12, 2006]
- Oregon payday loan shops under fire from officials [December 13, 2005]
See: Recent News | Archived News | RSS Newsfeeds | News by State
Go to PLIWatch.org home.