SPRINGFIELD — A bill that puts stricter laws in the payday-loan industry passed the Illinois House of Representatives Tuesday.
The measure is aimed at protecting folks from the payday-loan industry, the balance’s main sponsor, Rep. David Miller, D-Calumet City, stated.
“Payday-loan businesses should be controlled in a manner that is customer friendly and never victimize that is further in a period of need,” Rep. Miller stated.
But opponents with this bill state as opposed to helping individuals, it will probably cause them to become look for alternative means of finding financing that is short-term.
“If you limit access to payday advances, you do not limit the necessity for that loan,” stated Steve Brubaker, the executive manager of this Illinois Small Loan Association, which represents payday-loan businesses in Springfield.
This measure would prohibit short-term loan providers from lending significantly more than $1,000 or 25 % of someone’s month-to-month revenues, whichever is cheapest.
Rep. Frank Mautino, D-Spring Valley voted and only the balance although some amendments were said by him will always be required. The limitation on that loan should be $1,500 rather than $1,000, he stated.
In addition, a limit would be placed by the bill on charges charged by short-term lenders, capping the charges at $16 per $100 loaned. Rep. Miller said some payday-loan companies charge $44 or even more per $100 loaned.
The payday that is average charges a yearly rate of interest of 520 per cent, Mr. Brubaker stated. But consumer teams are finding cases of loans with rates of interest more than 1,300 per cent.