Push To Cap Payday Loan Rates

The steps of the state house were crowded with people hoping to bring some change to payday loans in Alabama.

 

Monique Okoye is an attorney from Birmingham, and she says most of her business is with people stuck in the cycle of loans. 

 

“You know, I don’t think they don’t understand, they hear the counterarguments to a payday loan. They hear that calling a 450% APR is inappropriate because it’s meant to be a short term loan and you won’t have it for a year, but the truth is you do end up having it for a year, or two years,” said Okoye.

 

This is the second year that lawmakers are pushing to end the practice of what Okoye calls loan sharks. 

 

And it’s that high interest rate that keeps people in debt that Representative Patricia Todd wants to cap at 36%. 

 

“All we want to do is very simple. We want to control their interest rate, we’re going to put a limit on how many payday loans somebody can have, and also have a database so they can check to see how many loans you already have before I give you a fifth one that’s going to sink you into poverty,” said Rep. Todd. 

 

And it’s that poverty that has forced some towns to stop new payday and title loan businesses from opening in their area. Senator Hank Sanders saw that happen just last week in hometown of Selma. 

 

“I believe that stealing is wrong, whether you steal with a pen, whether you steal with a piece of paper, whether you steal in some other way,” said Sen. Sanders.