Ohio’s payday lending limits pass
Ohio Issue 5, which puts limits on interest rates for payday lending, passed during Tuesday’s elections. This new voter-approved effort is said to be among the strictest payday lending rules in the country.
Details posted at Cleveland.com and at WTVG 13 in Toledo.
Over the past few months, payday lending has resulted in more comments and heated discussion than any other thread at Monroe on a Budget.
Update: here’s a snippet from the Columbus Dispatch story:
With Issue 5, payday lenders tried to partially overturn House Bill 545, which will lower the interest rate on payday loans from the current 391 percent ($15 per $100 on a two-week loan) to 28 percent. It also limits the number of the short-term loans a borrower can get in a given year.
Payday lenders, in a coalition called Ohioans for Financial Freedom, spent more than $16 million to gather signatures and seek a no vote on the issue, outspending opponents by more than 60-to-1.
Bill Faith, leader of the Vote Yes on 5 committee, said groups such as churches, unions and other organizations helped get the word out.
Posted: November 5th, 2008 under In the News, Payday loans.
Comments: 3
Comments
Comment from Bobby
Time: November 6, 2008, 12:26 pm
This is an overwhelming victory for Ohio’s consumers. Over 3 million Ohio voters strongly repudiated 10 years of predatory payday lending and asked for a return to fair and responsible small loan lending! This is a great thing for Ohio’s families, communities and economy!
Comment from Payday Loans
Time: December 4, 2008, 1:01 am
It’s ridiculous to think that payday loans are responsible for the economic mess in America. Apparently, economists have marked December 2007 the “official” beginning of our current recession. The National Bureau of Economic Research (NBER) identifies top activity at this point, and the U.S economy has been deteriorating since then. The NBER describes recession as “a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income, and other indicators.” It seems other organizations are in the same boat. Backed by the government, academics and the private sector, it’s as close to official as possible. These conclusions are based upon unemployment, incomes, industrial output and sales data. The highest point in employment and incomes was marked that December. In January, industrial output peaked and five months later, in the month of June, sales peaked. Democrats claimed this wasn’t a shock and called for an economic stimulus package. “The announcement simply makes official what we have long known: with rising costs of living, rising unemployment, record foreclosures and depleting savings, we must do more to help families make ends meet,” says Senate Majority Leader Harry Reid. So, this would mean that the proposal to ban payday loans is not a good plan. Reid highlighted that a recovery package must create more jobs, cut middle class taxes and instill confidence in the market and the people. Payday loans, and any other similar form of lending, have proven once again the magnitude of their importance in our economy.
Comment from Paula Wethington
Time: December 4, 2008, 2:53 pm
I thought the payday lending marketing campaign was “short term solution for short term needs.”
That’s not the economic reality for many American families today.
You cannot payday loan your way out of a lengthy layoff, a foreclosed home or disappearing savings.
Frugal living at least buys you some time until the jobs return or investments bounce back.
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