Read a Pacific Northwest, liberal perspective on world, national, and local politics. From majestic Redmond, Washington - the Northwest Progressive Institute Official Blog.

Thursday, June 07, 2007

Oregon may cap payday loan rates

Oregon is poised to cap interest rates on short term consumer loans:
The Legislature eradicated triple-digit interest rates on consumer loans in Oregon with a vote Wednesday that payday and car title lenders say will seal their demise.

The Senate voted 18-11 in favor of a bill that caps interest rates on all consumer loans under $50,000 at 30 percentage points above the federal reserve discount rate, now at 6.25 percent.

The action reinstates a usury law in Oregon and completes approval of a package of bills requested by Gov. Ted Kulongoski to protect consumers from the high interest rates charged by short-term lenders. Oregon payday lenders charge an average annualized rate of 528 percent on loans, which are typically for about $300 over two weeks.
Wow, the Legislature over in Oregon is on a roll. I always wondered what happened to the concept of "usury." At least in Oregon, it got repealed during the Reagan recession.

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