(Ohio) Governor battles payday lenders

[flashl]

By JULIE CARR SMYTH • AP Statehouse Correspondent • August 7, 2008

COLUMBUS, Ohio -- A budding fight intensified today as Gov. Ted Strickland, a Democrat, joined Republican leaders in a campaign to protect one of the nation's most restrictive payday lending laws.
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The law, which takes effect Sept. 1, limits borrowers to four short-term loans a year and caps annual interest rates at 28 percent. Lenders currently are able to charge what works out to an annual interest rate of 391 percent.

Payday lenders hope to submit enough valid signatures by Aug. 31 to get a request to repeal the law on the November ballot. They say the restrictions will effectively ruin their industry and the 6,000 jobs it provides in the state.

The industry, under the name Ohioans Fighting for Financial Freedom, is expected to spend as much as $16 million on its repeal campaign.

[trthnd4jstc]

1. I wonder how many fake signatures the Payday lenders can get by Aug. 31. n/t

[realisticphish]

3. petition signatures are probably part of the lendees' contracts nt

[realisticphish]

2. god i hate them

on one hand, people who do that get a chance to read the paperwork, and no what the interest rates are.


on the other hand, fuck that. It's loan sharking, and it needs to stop.

[MercutioATC]

4. I'd sign a petition to repeal the law.

They provide a service that, when used responsibly, has the potential to help many people who would otherwise be unable to get credit.

Don't pass laws to protect me from myself.

[doc03]

5. They are scum bags the only service they provide

is line their own pockets with money. All they do is take advantage of people that are addicted to alcohol, drugs and gambling. Those people go to them for help and all they do is get into a cycle of debt they can never get out of. Of course the bankruptcy laws have been changed in favor of same scumbags that even make it impossible to recover even through bankruptcy.

[MercutioATC]

7. They loan money to the financial "untouchables" when nobody else will.

The default rates are astronomical.

That said, these borrowers have nowhere else to turn. If not for payday lenders, they would have no access to credit.


Imagine this: You have a lousy credit rating, no assets, a minimum-wage job. The fuel pump on your car quits. You will get paid in a week but to get to work, you need the $200 to fix the fuel pump now. Who is going to lend you the money?

I'm all for full disclosure of fees, but I abhor laws designed to protect us from ourselves.

[trthnd4jstc]

8. Dear Mercutio, Should not there be a limit on the Maximum Interest Rate? n/t

[MercutioATC]

9. The so-called "maximum interest rate" is a fabrication...

...it's what one pays if one defaults on the agreement and refinances the amount borrowed repeatedly (including late fees).

The rate, if the borrower honors the contract, IS within usury laws (depending on the state, but usually in the neighborhood of 30%).

[doc03]

10. If someone borrows $200 to fix their fuel pump

this week it's nothing more than loan sharking to charge them $300 two weeks later to pay it off. I know how it works I have a brother that was drinking bad a few years ago and he got caught up in that cycle of debt. I have another friend that got into gambling bad (in a casino ran by the state of West Virginia) and got into that mess, when he filed bankruptcy just before the cut off he owed $189,000. Oh, he is back into gambling again and doing the same thing all over again. Those people that don't have the income to pay back a loan would be better off being turned down instead of some parasite helping them dig a hole even deeper. My brother borrowed my car and he happened to leave the receipt for a loan he got at one of those places. I believe he borrowed $300 and in two weeks he was to pay back $450 and the APR was something over 2000%. I see people every day barrow money at one place to gamble with then the next day barrow money from the one across the street to pay off the other one and get more gambling money. There's another subject that just makes me sick is the state run Casinos where you have a state treasury depending on taking advantage of mainly people on SS or SSI. Now and then I go to a buffet at the casino and judging from appearance 90% of the people feeding money to the machines a dirt poor. I don't know if in the last few years the interest rates have been limitted to 300% APR or what but I know the recipt my brother had the rate was well over 2000% that was about 5 years ago..

[2Design]

6. these are legal loan sharks n/t