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Crackdown on high-interest loans — blocked for ten years in Richmond — clears a vital hurdle that is first

Crackdown on high-interest loans — blocked for ten years in Richmond — clears a vital hurdle that is first

RICHMOND — A bill that bans the sort of online loans that hit Virginians with interest levels often exceeding 900% passed a vital first hurdle in the General Assembly on Thursday.

The legislation focusing on the web organizations also would slash costs levied for payday, vehicle name as well as other short-term loans.

It passed the home work and Commerce Committee 14-8. a bill that is similar sponsored by state Sen. Mamie Locke, D-Hampton, should come ahead of the equivalent Senate committee later on this thirty days.

For longer than 10 years, the typical Assembly has refused efforts to chip away in the loopholes in current guidelines and caps on interest prices — several of which translate to triple-digit interest levels.

The home bill’s sponsor, Del. Lamont Bagby, D-Henrico, stated the measure would guarantee reasonable treatment plan for borrowers and loan providers, and dismissed lobbyists’ arguments it would dry out credit.

“Affordable re re payments, equitable treatment for borrowers and loan providers, extensive usage of credit — and I won’t be back if this passes,” stated Jay Speer, executive manager of this Virginia Poverty Law Center, that has campaigned for decades for legislation to safeguard borrowers from high-interest-rate tiny loans. (more…)