Ohio Payday Advances Must be Reined In
By Paul RizzoPayday Loan Writer
The following is an editorial from The Cleveland Plain Dealer…
Democrat Marc Dann practically boasts that he is one of the most partisan statewide officeholders ever elected. But, he admits, “We don’t have a monopoly on good ideas.”
Thus, Ohio’s attorney general lauds Rep. William Batchelder’s effort to limit payday advance loan lending, a practice that has literally exploded in the state over the past decade.
Batchelder, a conservative Republican believed to have designs on succeeding Jon Husted as speaker of the House in 2009, is drafting a bill to limit short-term loans that come with sky-high interest rates.
Dann is all for restraining companies whose annual interest rates on faxless payday loans approach 400 percent - no matter who’s pushing the proposal. So far, however, House Minority Leader Joyce Beatty, a Democrat, is loath to jump on Batchelder’s bandwagon.
By her unwillingness to support an issue championed by a Republican, Beatty seems to be letting the people’s interests take a back seat to her party’s. She has told reporters that some of her Columbus constituents truly feel they need the short-term loans, believing it’s better to pay the interest than to lose elec- tricity or an apartment because of missed payments.
But no one is proposing doing away with short-term pay day loans altogether.
Batchelder is still drafting his measure, but Dann and others support setting interest-rate caps. He also expects Beatty to come around.
Consider these findings from “Trapped in Debt,” a report from Policy Matters Ohio and the Housing Research & Advocacy Center:
In 1996, Ohio had 107 quick payday loan locations; today it’s 1,562 - more sites than McDonald’s, Wendy’s and Burger King combined.
Ohioans paid $209 million in payday loan fees in 2005.
In recent years, state lawmakers actually increased the maximum loan amount from $500 to $800. They also exempted the loans from the 25 percent interest rate cap that applies to other lenders.
Nationwide, just 1 percent of cash advance payday loan borrowers take out only one loan annually. The average is nine such loans per year.
“There’s nobody in this state who can be for the rules we have now,” Dann says. “We can’t allow this kind of stuff.”
He’s right.
August 9th, 2007 at 7:22 pm
How do I contact Dem. Joyce. Beatty. I’m here to personally tell her… shut these places down!!!! I’ve been stuck in this trap since 2000 with 3 different companies. Then, my bank started offering them. It’s an evil trap. If anyone would like more information on how much havic these places can reep on a person, I will be more than happy to speak with them. I take one out to pay the other. I get loans to pay them off and then up with more payments. It’s a vicious cycle that needs to be capped off, or distinguished. PLEASE!!!!