“Caught in a trap”: Virginians describe payday loans to their experiences, urging feds to modify
Feeling misled, ripped off and eventually threatened by high-interest price payday and vehicle title lenders, Virginians are pleading with federal regulators never to rescind a proposed groundbreaking guideline to rein in abuse.
Tales from almost 100, attached with a Virginia Poverty Law Center page asking the buyer Finance Protection Bureau never to gut the rule, stated these interest that is triple-digit loans leave them stuck in some sort of financial obligation trap.
VPLC Director Jay Speer stated the guideline that the CFPB is considering overturning — requiring lenders to look at a borrower’s ability that is actual repay your debt — would stop a number of the abuses.
“Making loans that a debtor cannot afford to repay could be the hallmark of that loan shark rather than a lender that is legitimate” Speer penned in the page towards the CFPB.
The proposed guideline had been drafted under President Barack Obama’s management. The agency has reversed course, saying the rollback would encourage competition in the lending industry and give borrowers more access to credit under President Donald Trump.
Speer stated one common theme that emerges from telephone telephone calls to a VPLC hotline is the fact that individuals turn to such loans when they’re excessively vulnerable — coping with a rapid serious illness, a lost work or perhaps a major vehicle fix.
Another is the fact that loan providers easily intimidate borrowers, including with threats of arrest.
