On Feb 16, 2013, the GLD class heard from Alabama Arise policy analyst Stephen Stetson about the issue of predatory lending in Alabama. GLD participants were outraged to learn of the legal practice of usury in Alabama and the damage caused to communities by high cost lending. In Alabama, payday loans can legally charge 456 percent interest, while auto title loans are nearly as expensive – costing 300 percent interest and coming with the risk of losing the family car or truck.
Fortunately, reform legislation is pending before the Alabama legislature. Unfortunately, the predatory lending industry is well-funded and well-organized and fighting reforms every step of the way. You can help protect Alabama consumers from these predatory loans.
Attend a rally and press conference on April 2 and talk to your legislators about your concerns about these issues. All are welcome. Download a copy of the event flyer here.
A wide coalition of statewide groups and churches is pushing for a title loan reform bill. In the Alabama Senate, this bill is Sen. Mark Keahey’s SB 331. A House companion bill will be sponsored by Rep. Rod Scott. The industry also has their version of a title loan bill, one that makes no real reforms to the sky-high interest rates. This bill, HB 421 by Rep. Lesley Vance has already passed out of a House committee and is now in position to move the House floor for debate. The coalition strongly opposes that bill.
On payday lending, the House reform bill is HB 320 by Rep. Patricia Todd and the Senate version is SB 282 by Sen. Keahey.
Although the bill have bipartisan backing, many legislators are on the fence about whether predatory lending actually provides a service. Arise is urging everyone to call their lawmakers and let them know that you don’t think it’s a service when someone is drowning to throw them an anchor. An emergency payday or title loan only makes a bad situation worse, and Alabama can join other states that have successfully protected their consumers and borrowers from these predatory loans.
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