Out-of-state predatory lenders are currently pushing the PA Senate to legalize “payday” lending, also known as “loan sharking.” Join Just Harvest’s efforts to stop them.
Read more and take action!
| Out-of-state predatory lenders are pushing the PA Senate to legalize payday lending. |
What do the payday lenders want?
Currently, Pennsylvaniansare protected against the incredibly high interest rates of loan sharks byusury laws. These laws regulate the amount of interest that lenders cancharge. However, the Pennsylvania House of Representatives will soon be considering a bill, SB 975, to legalize “micro loans”.
What SB 975 describes as a”micro loan” program is, in reality, predatory payday lending. The bill would amend Pennsylvania’s usury limits and allow payday lenders to issue “microloans” charging 288% annual interest rates for a two-week loan! This is far afield from protections in place by the military, which caps their interestrates on loans to service members and their dependents at 36%.
Is payday lending really so bad?
This bill puts the state’s nearly 1 million veterans and all Pennsylvania families at risk.
- The abusive payday lending industry targets the most vulnerable in our society including the working poor and those on a fixed income, such as senior citizens.
Payday storefronts aretypically located in low-income communities and payday loans often lead to along-term debt trap that is difficult to escape.
- A working family living paycheck to paycheck may need to borrow $300 – a standard amount for these types of loans – to keep their heat from getting shut off. They will not likely be able to pay that loan back soon; if they had those kinds of savings at their disposal, they wouldn’t have needed the loan in the first place.
- Often you’ll see people take out a second payday loan to try to pay off the first, which often results in several months of paying and re-borrowing.
Loan sharks capitalize onstruggling families’ desperation and perpetuate a cycle of debt and povertythat affects all neighborhoods.
What should we do?
Pennsylvania should be proud that it has some of the strongestconsumer protection laws in the country. These are the laws that have keptcountless desperate men and women from becoming victims of payday lending loansharks.
State lawmakers need to ensure those laws are upheld.
Unfortunately, on June 4, 2013, State Senator Jim Brewster of Allegheny County was the oneDemocrat to join House Republicans on the Banking and Insurance Committee toapprove the new bill, SB 975, allowing it to proceed to the Senate floor later this month forpassage.
We need to tell PA Senators that Brewster and his committee colleagues made a mistake in allowing this bill to go forward and we want them to stop it.
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Just Call! |
| WHO: State Senators of Allegheny County – Find your legislator
HOW: Call their office – Contact your senator Tell your legislator’s office that “Policies that help payday lenders take the place of better policies to help and protect working families. They are not the economic investment that’s needed to create the jobs and strong communities that would benefit everyone in this region. I urge the senator to Vote NO on SB 975.” |
More background:
The last time this legislation was proposed – as HB 2191 in the spring of 2012 – Congress had the good sense to let it die. But now payday lending lobbyists have convinced key House Republicans to bring it back from the dead. This is the samepayday debt trap product wrapped up in different packaging. This isn’t thecredit innovation that’s needed to help working families.
UPDATE: On June 11, 2013, Pittsburgh City Council passed a Will of Council opposing PA Senate Bill 975
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