Yesterday, the Federal Consumer Financial Protection Board released final regulations covering Payday Loans across the country.
More about this from our colleagues at Joint Religious Legislative Commission:
The JRLC has consistently worked to protect consumers trapped in payday loans – predatory loans which create a cycle in which borrowers become trapped in loans they can’t afford, needing to take on new debt to pay off old debt and paying the equivalent of more than 300% Annual Percentage Rate for loans.
Yesterday, the Federal Consumer Financial Protection Board released final regulations covering Payday Loans across the country. And they are good news for consumers. According to research by Pew Charitable Trusts, the average payday loan borrower spends an average of $520 in fees to repeatedly borrow $375.
Last October, the JRLC joined groups around the country in submitting comments on proposed consumer lending regulations. The final rules address several concerns raised by JRLC and other consumer advocates. A key component of the new regulation is a requirement that lenders determine whether borrowers will be able to meet their basic expenses if they take out a loan.
For more information on the new rule, this article from Bloomberg explains it in an understandable way.
For a copy of the comments JRLC submitted to the CFPB, click here.
And if you know of Minnesotans caught in the payday loan spiral of debt, please direct them to Exodus Lending, a non-profit that has helped hundreds of families get out of the payday loan debt-trap.