A Tennessee Loan Shark on the Prowl
Marsha Blackburn, who represents Tennessee’s 7th District in Congress, has made her choice.
She’s chosen to stand with payday lending loan sharks and against the interests of Tennessee consumers.
Blackburn has signed-on to co-sponsor HR 4018, the misnamed “Consumer Protection and Choice Act” that would allow payday lenders to continue trapping consumers in a cycle of debt.
Specifically, the bill:
would delay the CFPB’s payday rule for two years, and would allow the payday industry to avoid federal regulation altogether by pushing industry-backed state bills based on a Florida law that has proven ineffective at reining in the payday loan debt trap.
Here’s the Florida story for payday lending consumers:
Triple digit interest rates: Under Florida law, the typical payday loan costs over 300% annualized interest (APR)—an exorbitant rate of interest that wreaks havoc on households who are already struggling financially, and was illegal in all states until relatively recently;
• Back-to-back lending without considering borrowers’ ability to repay – Rollover bans and cooling off periods are insufficient to protect borrowers from long-term financial harm. In spite of the industry-backed Florida law, 88% of repeat loans were made before the borrower’s next paycheck;
• A long-term cycle of debt – Limiting borrowers to one loan at a time has failed to provide relief in Florida, where 85% of payday loans are issued to borrowers with seven or more loans per year; and
• $280 Million in fees drained from lower-income Floridians per year as a result of repeat lending at abusive rates and $4 billion in fees drained annually from consumers across the country.
If the bill Blackburn is co-sponsoring becomes law, this could be the story in Tennessee and across the country.
Call Marsha Blackburn today at 202-225-2811. Tell her you oppose HR 4018.
Tell her to stand up for Tennessee consumers and against a free pass for payday lending loan sharks.
For more on payday lending and other consumer issues, follow us @TNCitizenAction