Ohio Passes Legislation That Will Punch Payday Lending Industry In The Face

Ohio’s House of Representatives passed the ominous face-punching legislation that will, if passed by the Senate, become the strictest payday lending regulation around.

After months of debate over bills that were backed by either the payday industry or consumer advocates, the proposal that passed the House 69-26 is a victory for the Ohio Coalition for Responsible Lending, which pushed to lower the current 391-percent annual interest rate on two-week payday loans.

The group got a bill even more restrictive than it requested. It sought a maximum 36 percent interest rate and got 28 percent. The coalition wanted to limit borrowers to six loans per year, but the bill imposes an even tougher four-loan limit.

“It sends a really strong bipartisan message that we want to first be about protecting consumers in Ohio,” said Bill Faith, a leader of the coalition.

Meanwhile, the payday industry, which was talking optimistically a few weeks ago that lawmakers were not supportive of an interest rate cap, got steamrolled.

“What have you accomplished here? You’ve eliminated a product that people need, and you’ve eliminated jobs,” Daryl K. Dever, chief lobbyist for the payday industry in Ohio, told the House Financial Institutions Committee before it OK’d the measure this morning.

Even people who are married to lobbyists working for payday lenders voted for the bill, says the Dispatch:

House Minority Leader Joyce Beatty, a Columbus Democrat who in the past questioned the need for an interest-rate cap and whose husband is a lobbyist for a payday lender, voted for the bill.

How about that. Now the bill goes to the Senate, but a tipster tells us that it is popular with the Senate President and could pass as early as May 6.

Payday-lending bill passes Ohio House [Dispatch]
(Photo: taberandrew )

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  1. “What have you accomplished here? You’ve eliminated a product that people need, and you’ve eliminated jobs,” Daryl K. Dever, chief lobbyist for the payday industry in Ohio, told the House Financial Institutions Committee before it OK’d the measure this morning.

    Let’s eliminate your job, you predatory prick.

  2. blackmage439 says:

    “What have you accomplished here? You’ve eliminated a product that people need, and you’ve eliminated jobs…”

    I’ll give you the latter, but the former is certainly hogwash. I’m sorry, but if you’re in dept so deep that the only way to perpetuate your lifestyle is to borrow more, than you really need to rethink your life. For hell’s sake, the interest rate on most credit cards is far, FAR below 28%, let alone the ungodly 391% APR that this bill is protecting against. I can’t feel sorry for people who actually bury themselves in greater debt than the kind they’re trying to solve. Get a second job, sell/downgrade your house, anything but giving these shady, amoral business a cent of your hard-earned cash.

  3. GreatCaesarsGhost says:

    Payday lenders create jobs and fill a need for people that can’t get help elsewhere.

    Just like the meth industry.

  4. FHJay says:

    This reminds me of when the United States was setting up the national Do Not Call list, and telemarketing companies complained that they were losing revenue and jobs. If you provide a ridiculous service, then it’s only reasonable that you’d lose your job when people have had enough.

    This is like drug dealers complaining that anti-drug laws hurt their revenue.

  5. dwarf74 says:

    Well, Daryl-from-the-article, maybe if your industry had behaved itself a little bit better and acted less like leeches, this face-punching bill would never have gotten off the ground.

  6. laserjobs says:

    Yeah!!! Now the banks can take the business and the losses will be eaten by the taxpayers. Big win for banks!!!

  7. Coelacanth says:

    These payday lenders will probably just have to up the ante and give out larger loans to customers.

    Then again, they could see a larger demand for their business since the rates are capped.

    However, I’m sure that some of these places would do well to implement an “application fee” and a “credit check fee” to subvene the costs of underwriting… I forget who the commenter was yesterday (or a few days ago) who suggested that might happen.

  8. FLConsumer says:

    Even 28-38% seems high to me. Then again, these places do need to make a net profit after all of the people take the money & run.

  9. ShirtNinja says:

    This bill makes me dance a little in my chair, and I’m not even an Ohio native (or an American, for that matter). I hate these places, and I’m all for smacking them down and HARD!

  10. Cattivella says:

    I don’t see how this would shut down payday lenders. It just doesn’t allow them to gouge the guy who needs money before his next paycheck. They can still exist, they just won’t be as rich. They’re definitely not pulling any heartstrings with saying these people will “lose jobs”.

  11. mizmoose says:

    Aren’t there already usury laws on the books? Isn’t that why loansharking is illegal? Do we really need more laws to prevent idiots from themselves? Can’t existing laws cover this?

  12. cubejockey says:

    My god! Logical legislation in Ohio!!!

    Legislators in Columbus like to do things like destroy class action lawsuits for the working poor and declare a day off on Reagan’s birthday.

  13. Corydon says:

    Holy crap…even in the Middle Ages the interest rate was only about 40-50% or so.

    I thought the payday loan place that Gary Coleman was hocking was bad, but compared with 391% interest, that 99% APR looks like a positively good deal…

  14. @Cattivella: Simple math. This WILL kill the payday lending business. I’m not nearly knowledgeable to know if thats a good thing or not, but it will.

    Here is why this kills the industry. That 391% APR is based on a 2-week loan. The interest on a $500 loan at 38% is only a couple of dollars over that two-week time frame. To make any profit from that loan (even if you charge a processing fee) you would need to keep your default rate under 1% and make thousands of loans each period.

    The people taking these loans will still need the money. Im willing to bet we will see an uptick in theft illegal loansharking.

  15. LorneReams says:

    I kinda understand where some of the arguments are coming from. I would rather there be a choice that I can refuse then getting rid of the choice completely. This here:

    “The coalition wanted to limit borrowers to six loans per year, but the bill imposes an even tougher four-loan limit.”

    seems strange on the surface. Limiting the interest rate, great! Limiting how many times you can use a product…not so much.

  16. @cubejockey: What? The working poor are a class with causation to sue?

  17. rmz says:

    @Corydon: The kicker with CashCall is that I believe the minimum loan amount in many cases is $10,000. With a fixed payment plan and you cannot pay additional towards principal, as far as I’ve read.

    So, a $10,000 loan at 99% APR works out to be roughly $40,000 at the end of the repayment term. They even show this on their web site, it’s frightening.

  18. Pylon83 says:

    This whole thing is dumb. The State government shouldn’t be getting involved in this kind of stuff. I’m certainly glad I don’t live in Ohio. Maybe next they will limit how much a restaurant can charge for steak, and how many times you can eat there per year. Payday loans only developed because there was a need for them. When they all close down because they are no longer profitable, where is the person who need a quick $500 to get their car fixed so they can get to work going to get it? The people who use these places have terrible credit, likely no credit cards and obviously don’t have anywhere else to get the money. These kinds of laws are bad news and unnecessary. What happened to personal responsibility?

  19. HIV 2 Elway says:

    Ohio being progressive? I’ve heard it all.

  20. HIV 2 Elway says:

    @Cattivella: True if anything, the loans should be more attractive and generate more loans. Less incentive to open a payday loan shop though.

  21. Black Bellamy says:

    @Pylon83:

    Substitute the word ‘heroin’ for ‘payday loans’ in your post and it will make just as much sense.

  22. Blueskylaw says:

    Those stacks of bills in his hands represents the interest you paid for a $100.00 dollar loan for one week.

  23. satoru says:

    @Pylon83: The situation you are describing is what the payday lenders want you to believe. However statistically it has been shown that in reality, well, the people borrowing the money are basically retards. They use the money for booze or a TV, or whatever they fancy. While you might say the government doesn’t need to regulate people’s stupidity. However, these people are in fact a drain on the state’s resources via welfare, or other social services these people end up using after they’re totally broke.

  24. opfreak says:

    lol. I love how people are cheering goverment restriction.

    What business are you in? How much money do you make?

    Tommorow the goverment will pound down you door saying, sorry thats just too much profit.

    Payday lenders, give money to people that cant get a loan anywhere else. most have no credit check, and charge no fee’s other side the interest.

    If your in a bind, and need cash today, then the 800 bucks you borrow might cost you 100.

    Now you can’t get that loan period because the goverment says no.

    The people that support rules like this are nuts.

  25. lymanjt says:

    As someone who lives in Ohio (and whose community is blighted by no less than 6 of these shops for a town population of roughly 20k) I am overjoyed about this. My wife works with many people who frequent these places to make ends meet only to go back and back because they couldn’t repay. It makes me sad.

    @laserjobs: banks won’t make any more off of this than they already do. I used to collect on overdrawn accounts in my hometown and I would say 90% passed a check to “cashland” or an analogue and it overdrafted their account. So really these people are getting it on both ends, and often.

    I just hope that community banks like the one I left step up to the plate with reasonable short-term loan alternatives. When I suggested to my old boss going under the FDIC’s new pilot program for short term loans, he said that the overdraft account protection was their company’s way of handling such a circumstance. Sounds like bullshit to me.

    @ mizmoose: payday lenders are exempted from usury laws. The usury limit in Ohio is 25% APR, but somehow these guys get around it. I think it has to do with length of loan or something like that.

  26. cubejockey says:

    @opfreak:
    lol i laugh back at you. Where do you bank at? Can we poor people get a loan for 500 bucks a 5%?

  27. chrisjames says:

    @FLConsumer: It’s high for loans with several month durations, like credit cards, or several years, like credit cards that never get paid or car loans. It’s average for two week loans because it still doesn’t generate much interest.

    Look at it this way: For two weeks, 400% APR comes out to roughly $15 for every $100 borrowed. I’m paying over twice that on a bad five-year car loan (12% APR). With my good credit I could have gotten as low as $18 to every $100 on the loan, but that’s another story.

    In any loan situation, the victim is the party that follows the loan agreement when the other does not. The victims, according to the OCRL, are the poor borrowers who aren’t paying back their loans on time. Instead of easing the burden of the poor and uneducated, they squish the people making profit. That’s like the wife lashing out at her husband’s mistress when she catches them in bed.

  28. Loki_Monster says:

    Payday loans have an unbelievably high rate of default, because the consumers seeking them are high risk and can’t get the money anywhere else for good reason. Now those defaults will be guaranteed by the taxpayers of Ohio. Congratulations Ohioans!!

    Besides that, banks doing business in Ohio are not required to step in and provide these types of loans. Reputable banks won’t enter the business, and the banks that do enter this business will find ways (fees, etc.) to make money. The bank will get its application fee, processing fee, etc. fee up front, then when the loan doesn’t perform, Ohio taxpayers will reimburse the bank for the funds loaned.

    I don’t have any fondness for payday lenders, but this makes absolutely no f*cking sense, unless you’re a politician trying to look sympathetic to the poor squeezed consumers, most of whom aren’t getting these kinds of loans to begin with.

  29. I used a payday loan once. It helped me out of a tight jam. Getting my car out of the inpound for back registraction just in time for me to start a new job. If I didn’t have that pay day loan I wouldn’t of been able to start my new job. I would of coutinued down the wrong path.

    Just kidding, I spent the payday loan on drugs and hookers.

  30. CK76 says:

    BEST. HEADLINE. EVAR.

  31. uberbucket says:

    I hope this sets a precedence that all other states adopt.

    A loan shark by any other name…

  32. opfreak says:

    @cubejockey

    lol, even people with good credit, wont get a bank to give them a blank check from a bank @5%.

    in general being poor, does not mean you cannot get credit. Have terrible credit means you can’t get credit.

    These places filed a need. High risk loans to people with terrible credit.

    heck, the default rates on credit cards can/are higher then these places are.

    Maybe ohio needs to pass a law. Only 4 credit card purchases a year.

  33. S-the-K says:

    It’s one thing for a lobbyist to BUY a politician, but he went so far as to MARRY a politician. Now THAT’S commitment to the cause! He can lobby 24/7, not just when the politicians are at “work”, like other lobbyists.

    I guess she had a choice between supporting her husband’s loan shark buddies or get re-elected voted accordingly.

  34. BigElectricCat says:

    “What have you accomplished here? You’ve eliminated a product that people need, and you’ve eliminated jobs,”

    Huh.

    Did the same thing when we outlawed slavery, too.

  35. Xkeeper says:

    @blackmage439: I’m not arguing for payday loans, but let’s assume that I come down with some dire illness and I need, say, $500 rightnow in order to pay for treatment/medicine to make it go away and not get worse.

    My current lifestyle basically is come home, go to bed, go to work, repeat, and I don’t exactly earn much ($8.50/hr * rand(38,42)). I don’t have a lot of savings built up because of a lot of beginning expenses.

    I’m not saying they’re a good thing. I’m just saying, sometimes it can’t be helped.

    Creating a government-backed way to give short-term loans like this without having a huge interest rate and making them payable by actual humans would be a good thing, because right now, anybody who would need some quick cash for something would be mostly screwed.

  36. sisedi says:

    This is absolutely wrong, just because we hate their service that gives us no right to deny what they do. Yeah they’re sleezy and try to rob you blind but so do so many other industries and companies. Seriously people, this law only protects IDIOTS or DESPERATE FOOLS from themselves. We’re all educated and know way better than going to these places but some people need it and we shouldn’t deny them because we don’t like it.

    Same thing as the smoking ban, ban on gambling, blah blah blah blah more government, yay, thank you.

  37. BigElectricCat says:

    @Pylon83: Cry me a river.

  38. flaxen_vixen says:

    I love it when the government tells me what I can and can’t do with my own money and restricts my choices.

    I love it even more when the government puts people out of work and calls it “progress”.

    It’s easy for people who have nothing to lose to call for a ban. They have nothing to lose. Their jobs aren’t on the line and they have likely never used (or even needed) a payday advance.

  39. tmed says:

    Cap it at a level that lets the industry survive.

    All you fools who think this is Ohio being Progressive are dead wrong, this is Ohio politics being owned by bankers.

    This was not done to control a service that people need (have you noticed the demand?), but a servie that has been abusing their position. This is legislation to KILL an industry without any alternative for people.

    I don’t think the commenters here have spent enough time broke to understand. Food or a usurious charge? You pick.

  40. Curiosity says:

    Payday loans are not bad in concept what is bad is the excessive amount of interest that is charged – this causes a need to refinance and results in a higher default.

    It is claimed that the lenders are required to charge the amount b/c (1) that is what the market will bare, or (2) they have huge overhead costs. However it seems that the practices that they endorse (high interest rates and expansion) typically result in the justifications for their actions (that there is a greater risk of default or a greater demand).

    Payday loans are a type of subprime lending except they are geared to threaten people already prone to bad credit with worse credit, making them dependent.

    This practice is similar to lawyers or doctors charging outragious fees so that clients do not suffer disaster. No one really believes that these industries shouldn’t be regulated so at the very least they can be disciplined by the state for not giving professional service.

    People should instead look to alternatives – perhaps microlending. aka http://www.kiva.org which ironically can be incredibly profitable, help build small business, and improve credit.
    [en.wikipedia.org]

    After all do people really think that the unfortunate like not being able to pay their bills or earn money? Sometimes investing in people actually means taking a chance and having faith in them rather than screwing them.

  41. Curiosity says:

    @Pylon83:
    How isn’t it in the state’s interest to protect its citizens? In fact this is one of the state’s primary functions. Here it is everone’s interest to avoid chronic borrowers.

    Perhaps a little reading might do everyone a bit of good.

    “[D]espite its expanding customer base and notwithstanding industry denials, the financial performance of the payday loan industry, at least in North Carolina, is significantly enhanced by the successful conversion of more and more occasional users into chronic borrowers.” [edq.sagepub.com]

  42. maddypilar says:

    “What have you accomplished here? You’ve eliminated a product that people need, and you’ve eliminated jobs,” Daryl K. Dever, chief lobbyist for the payday industry in Ohio

    Did he then follow up by saying, “All you’ve done is weaken a country! I’m gonna rip the eyes out of your head and piss in your dead skull! You f–ked with the wrong loan shark!

  43. BigElectricCat says:

    @flaxen_vixen: Do you operate a payday loan business? Because I can’t quite see where your money comes into play here.

  44. Pylon83 says:

    @Curiosity:
    Don’t take my support for the payday loan business as a claim that it is not predatory. I fully recognize the predatory nature of the business, and I won’t argue otherwise. However, my thoughts are “so what?” Who cares if its predatory, all businesses are. A restaurant’s financial performance is enhanced by the successful conversion of more and more occasional diners into chronic diners. Where is the personal responsibility? Why does the state need to step and in protect people against themselves? This isn’t a law to protect people from drunk drivers, or from people driving dangerous vehicles on the road, it’s a law to protect people from themselves, and it is unnecessary. The state should not have to play “mother” to all the people who chose to use a Payday loan service.

  45. FLConsumer says:

    @chrisjames: To be honest, prior to reading The Consumerist, I had no idea that interest rates >15% existed. I’m used to seeing #’s like 7.5% on my credit card statements (never carried a balance ‘though) and seen ~7-8% loans from my bank whenever I needed extra capital to start up a few ventures.

    I agree that the payday loan places tend to take on very high-risk loans.

    Unfortunately, it appears most of the payday loan places are private companies. Very curious to see what their net profit is. These places seem to be popping up all over in Tampa, so obviously they’re not hurting for business, nor are they unprofitable. Granted, at 300%+ interest, you can have quite a few people default on you without worry of not making a profit.

  46. Pylon83 says:

    @BigElectricCat:
    His money comes into play because Ohio is limiting a person to only 4 loans per year. If you’re going to make comments, informative/insightful/thoughtful comments tend to contribute the most to discussion. Comments like “cry me a river” or “You must own a payday loan company” add little value, and are rather pointless.

  47. hat872001 says:

    Kucinich is the guy that makes things like that happen in Ohio, a great congressman.

  48. LUV2CattleCall says:

    @Xkeeper:

    Not to be an ass…but the internet isn’t exactly a necessity that you’d die without. There’s always the library for situations where you need a computer…. And if you’re commenting from work…well…that’s why you’re not getting that promotion.

    I know it sounds harsh, but after seeing my parents move from a 3rd world country to the USA with literally nothing, deal with nearly every obstacle imaginable, save up enough money to attend college, and graduate medical school, I have a hard time feeling bad for people who make excuses and pretend they are giving it everything…. I mean, donate plasma if you have to, or work at a McDonald’s in the evenings…etc.

  49. BigElectricCat says:

    @Pylon83:

    “His money comes into play because Ohio is limiting a person to only 4 loans per year.”

    That’s irrelevant to the question I asked that poster. Would you like for me to restate the question for you?

    “If you’re going to make comments,
    informative/insightful/thoughtful comments tend to contribute the most to discussion.”

    I look forward to seeing some comments of that nature from you.

    “Comments like “cry me a river”

    I judge this comment of yours — “Who cares if its predatory, all businesses are” — to be specious and jejune. Clearly many posters here *do* care, whether you do or not. Perhaps you should make a informative/insightful/thoughtful comment on that score, rather than throwing your figurative hands up and saying “who cares?”

    “or “You must own a payday loan company” add little value, and are rather pointless.

    I didn’t *say* “You must own a payday loan company,” so your enclosure of those words in double-quotes (thereby making it appear that you are quoting me) is misleading and dishonest. I asked that poster a *question,* and unless you can answer it for them, I’d venture to say that your reply on that score adds little value, and was rather pointless.

    Again, would you like for me to restate the question for you?

  50. Pylon83 says:

    @LUV2CattleCall:
    I think I agree with your point, generally at least. However, I’m not sure it really goes to XKeeper’s comment. I too HATE it when people bitch about “working hard” and “barely making it”, though they have time/money for booze, cable tv, and don’t want to work a second job. That said, I don’t think that line of thought is relevant to why I think Payday loans are OK. I’m more of a “Free choice” kind of thinker, and if people want to take out loans at a 500% APR, why not let them?

  51. Pylon83 says:

    @BigElectricCat:
    Ah, a nice snarky reply. At least my comments provide an alternative point of view, rather than simply taking pot shots at people. I agree that I misquoted you, and for that I apologize. However, what I had in quotes was essentially what you said. You were clearly accusing him having a stake in the Payday loan business. And when I said “who cares”, I followed up with information as to why I feel it shouldn’t matter, I didn’t simply “throw up my hands” as you accuse. Again, next time, how about a comment that actually adds something to the discussion, as opposed to a snarky attack?

  52. BigElectricCat says:

    @Pylon83: Look, pal — your original comment, to which I responded was “This whole thing is dumb.”

    That’s not very informative/insightful/thoughtful, now is it?

    “Ah, a nice snarky reply.”

    I give what I get.

    “At least my comments provide an alternative point of view, rather than simply taking pot shots at people.”

    I’ve got one of *your* pot shots below. Just keep reading.

    “I agree that I misquoted you, and for that I apologize.”

    Accepted.

    “However, what I had in quotes was essentially what you said.”

    Nope. You are *quite* incorrect.

    “You were clearly accusing him having a stake in the Payday loan business.”

    Better restart your Windows For Telepaths software. I quite clearly *asked* if the person had a stake, because it’s not clear to me what “money” that poster refers to *unless* they have such a stake. Unlike your presumptive self, I prefer to *ask* people for clarification, as opposed to leaping to conclusions and hurling unwarranted accusations.

    “And when I said “who cares”, I followed up with information as to why I feel it shouldn’t matter, I didn’t simply “throw up my hands” as you accuse.”

    No. You presented your *opinion,* which is fine as far as it goes, but I wouldn’t go so far as to call opinion “information,” no matter from whom it emanates.

    “Again, next time, how about a comment that actually adds something to the discussion, as opposed to a snarky attack?”

    How about you do the same, Mr. “This whole thing is dumb?” Police your own posts, and I’ll police mine. And grow a thicker skin while you’re at it. The internet’s full of people who aren’t necessarily going to agree with you, so learn to deal with criticism and disagreement.

  53. stinerman says:

    @laserjobs:

    Every time one of these stories comes up you make mention that now the banks have no competition. Personally, I haven’t seen a single bank that engages in payday loans. Do you have evidence of a bank that does?

  54. chrisjames says:

    @FLConsumer: It’s not about high-risk loans at all. Fees and excessive APRs are used to alleviate high-risk loans. For a two week payday loan, 400% APR is not excessive at all. At that interest rate, the place earns less money than a decent car loan generates, as per my example. The length of the loan has a huge impact on the return on investment. At 28% APR, the return on investment is 1%, $1 for every $100. That’s not just squeezing the payday lenders, it’s murdering them. The high-risk nature of payday loans leads to nasty fees, which I haven’t yet read if this law will forbid.

    @Curiosity: It’s the state’s job to protect its citizens when they can’t protect themselves, not when they can protect themselves but don’t want to; not ever. Would you want to shoulder the responsibility of someone who can bear it, but refuses to do so themselves?

  55. cubejockey says:

    exactly. the government is to protect those who have no protection. Especially the poor. Not everyone is a CPA. There are dozen of payday lenders in service-laden Ohio cities where the entire average working wage goes towards rent, food, diapers and hopefully college tuition. There is no safety net.

  56. tmlfan81 says:

    @Cattivella:
    Comment on Ohio Passes Legislation That Will Punch Payday Lending Industry In The Face Payday Lenders are predatory agencies that prey upon the hapless victim
    looking to get out of what they think at the time will be a short-term
    situation. At the time the terms, which are openly expressed before you
    sign your life away, appear to be doable because while you don’t have the
    money now, you will in two weeks.

    Two weeks shows up and you are in a situation that left you no better than
    where you were. If they are the type of company that lends out every two
    weeks and doesn’t “extend” the loan, you are back to square one and should
    simply consider it a lesson learned. What really gets my blood boiling are
    the places that extend the length of the loan by another 2 weeks, and then
    another and another. Finally, you have fees coming out the ass that you
    were never ready to pay for in the first place with little or no recourse.

    The borrower is stupid for thinking the one payday loan was going to solve
    their problems. The lenders are downright offensive thinking that what they
    are doing is providing a service to their customer base. As times get lean
    and we look towards the prospect of getting second and third jobs just to
    keep food on the table and ourselves out of debt, there should be less
    options like these available to consumers to avoid them from getting too far
    gone to begin with.

    If you are currently in an agreement with a payday lender and you are
    running behind in your situation, check with the laws in your state and how
    loans are regulated. There is a good chance that the lender didn’t even
    follow the letter of the law and what you took out is likely all that you
    will owe, sans the fees and collection activity. Get the information from
    your state’s online site, and get in contact with your lender. Make
    arrangements – just like any creditor – and get a payment plan going. If
    your loan’s fees and terms are in excess of what your state legally allows,
    while you still owe the principal you likely could get out of the fees.

    Consult an attorney if you need to – but get out while you can.

  57. tmlfan81 says:

    @satoru:

    Booze or TV.

    Riiight. Not everyone that has taken out a Payday loan has done it so they can buy something they couldn’t afford. There are people on the other side of the fence that have used those services before to get out of a tight spot they [or some other outside factor] have put themselves into.

    I’m not saying they were any wiser in making the choice to go with a payday advance, but not to make a sweeping generalization that everyone who takes out the loans is doing for shits and giggles is pushing it.

  58. geoffhazel says:

    Trying to legislate market forces on pricing and availability in any industry rarely has positive results.

    It’ll force people who do rely on payday loans to simply go to more places to get around the “annual limit”. That part of the law is D.O.A.

    It’ll be interesting to see if the companies simply pull out of Ohio, or figure out another way to get around the restrictions.

  59. Mr. Gunn says:

    opfreak:

    THIS. Definitely. It’s a good start, but people aren’t going to stop spending money they don’t have yet, so how come payday lenders get the smackdown so that credit card companies and banks can rake in late payment and overdraft fees?

  60. PaydayConsumer says:

    I took out several payday loans as an undergraduate student and found myself far more in debt than when I started. Quite frankly, payday loans are just too accessible to those who are unable to pay back loans. Lenders should be paying more attention to my ability to repay loans and other borrowers’ ability to repay their loans. I got sucked in and couldn’t get out and the case is the same for many other Ohioans. I’ll be paying down debt for quite some time and I’m thankful that HB 545 will prevent others from heading down a similar path.

  61. This is really harsh with these payday lenders. The law makers should consider that the nature of payday loans is such that the high APR is not at all valid here. After all the consumer borrow this loan hardly for a month. Anyway the bottomline is that the consumer is going to suffer.