DURHAM, N.C. — Working off the recent federal cap on payday loans to military service members, the Center for Responsible Lending, Consumer Federation of America and National Association for the Advancement of Colored People have begun working to get as many states as possible to limit all payday loans to charging interest rates of no more than 36%.
"Payday loans sink borrowers into quicksand-like debt," said Michael D. Calhoun, CRL president. "Borrowers end up paying more in interest, at rates of 400%, than the amount they originally borrowed. But by addressing payday lending squarely with a 36% APR cap, state lawmakers can get working Americans back on solid financial ground."
The three-organization coalition against payday lending is not new, but at a press conference held to release an update of a 2003 Center report on payday lending, Calhoun, Jean Ann Fox, director of consumer protection with the CFA and Julian Bond, chairman of the NAACP struck optimistic tones about the problem even as they pointed to the updated study's results on how bad the problem has become.
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