Ohio Governor Signs Payday Lending Bill

Go get ’em Ohio!

In a previous post I had talked about an Ohio effort to cap interest rates on loans. This would cripple the insidious Payday Lending industry.

Good news – the bill has been signed into law:

Gov. Ted Strickland, of the great state of Ohio, has signed a bill that punches the rapidly growing payday lending industry in the face. As we’ve mentioned before, the bill will cap interest rates at 28% and limits consumers to 4 payday loans per year. A typical payday loan charges around $15 per $100 borrowed on a 2 week loan, which works out to an interest rate of 391%.
[via Consumerist]

This is a scam industry that needs to be wiped out. It doesn’t solve money problems. It defers and amplifies them.

Does anyone know of other states that have regulations against Payday lenders? I would love to post an honor roll.

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3 Responses to Ohio Governor Signs Payday Lending Bill

  1. Tom M. says:

    One vote for Connecticut. “Payday lending” is illegal here. But to me, the big problem isn’t the lender, it’s the APR. 367% interest on a $100 loan is usury, but there will always be folks who think they need an extra $100. Might be for cheap wine, or a child’s medicine, but needs can arise. Cap the interest rate, and the “payday lender” will disappear.

    Another one that ticks me off is the web-based “student loan”, where the recipient gets $10K cash but signs an agreement to pay 18% interest on that $10K over a 30 year period. That’s $44,000 in interest! And there’s a penalty for paying it off early. yeesh

    T.

  2. Consumers should decide whether to have access to payday advance services said the Community Financial Services Association of America (CFSA) as it announced a referendum to overturn the recently passed law effectively banning payday advances in Ohio.

    The referendum would repeal Substitute H.B. 545, which was signed by Governor Ted Strickland on June 2, 2008. The Reject HB 545 committee must collect 241,365 valid signatures before September 1st in order to qualify for this November’s ballot. Voters will be asked to oppose enactment of the Sub. H.B. 545 as adopted by the General Assembly

  3. angelbearoh says:

    I’m a payday loan junkie, and sorry to say, but it took passage of H.B. 545 to really make me see the error of my ways. I’m going to eat the $50 late fee my apartment complex charges on late rent. This is going to be the first of the really hard withdrawal pains involved in fighting my jones.

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