CCI celebrates Predatory Loan Prevention Act becoming legislation

CCI celebrates Predatory Loan Prevention Act becoming legislation

Tuesday, Mar 23, 2021

First Page News

The Catholic Conference of Illinois is proud to announce that Gov. J.B. Pritzker today signed into law Senate Bill 1792, creating the Predatory Loan Prevention Act, which caps the percentage that is annual (APR) on predatory loans, such as for instance payday and automobile name loans, at 36%. Illinois becomes the eighteenth state to cap APRs at 36per cent, combined with District of Columbia.

CCI joined up with other justice that is social teams in pressing passage through of the legislation throughout the January lame-duck session, and celebrates the governor’s action today.

See the news release released because of the teams below.

Predatory Loan Prevention Act Signed into Law

Advocates, business, community, and faith leaders celebrate 36% rate of interest limit on loans; applaud Illinois Ebony Caucus for leading equity pillar that is economic

CHICAGO (March 23, 2021)—The Predatory Loan Prevention Act (SB1792 – PLPA), signed into legislation by Governor Pritzker today, marks a significant milestone for financial equity in Illinois and possibly sets the phase for any other states to follow along with. Years when you look at the creating, advocates—including a varied coalition of 150 nonprofits, civil legal rights teams, loan providers, faith leaders, and elected officials—applaud the task and vision set because of the Illinois Ebony Legislative Caucus that helped result in the standard-bearing bill feasible in a crucial monetary 12 months for a lot of.

The PLPA establishes a 36% APR limit on customer loans in Illinois, supplying defenses against pay day loans, installment loans, and car title loans, leaving more income in families’ pouches to blow within the economy that is local create local jobs. Illinois customers save money than $400 million each year in payday and automobile title loan charges, together with APR that is average a cash payday loans NH advance had been 297%. Both industry and customer advocates agree totally that the PLPA may have national implications, increasing the club on state usury defenses.

“Today may be the culmination of over twenty years of advocacy,” said Brent Adams, Senior Vice President of Policy & Communication at Woodstock Institute. “Thanks to your leadership associated with the Legislative Ebony Caucus, Illinois is certainly going from being house for some of this worst abuses on the market to establishing a unique club in customer financial protection.”

Reducing the racial wide range gap is really a key principle associated with PLPA: because people staying in communities of color pay over 2.5 times the maximum amount of per capita in charges as individuals located in majority White communities, the cost savings through the 36% rate cap will notably gain Black and Brown communities. The recently released Woodstock Institute report on jobs also indicates that more jobs is going to be added being a total result of the PLPA.

SB1792 had been championed into the legislature by Senator Jacqueline Collins (Assistant Majority Leader), Representative Sonya Harper (seat for the Illinois Legislative Black Caucus), and Senator Christopher Belt. The PLPA had broad support that is bipartisan including the majority of House Republicans and many Republicans within the Senate, including Minority Leader Dan McConchie.

“For over 35 years, legalized loan sharking in Illinois has sapped vast amounts of bucks from low income and Black and Brown communities,” said Assistant Majority Leader Jacqueline Collins, a primary sponsor associated with PLPA and a long-time advocate for customer economic security. “The PLPA’s 36% rate cap strikes the balance that is right use of safe and affordable credit regarding the one hand and defense against predatory financing regarding the other.”

“This is yet another, crucial action toward overcoming a few of the racial inequities which have overburdened communities of color inside our state for a long time,” said Illinois Rep. Sonya Harper, (D-Chicago). “The disproportionate effect of those exorbitant costs happens to be one of the numerous facets which have added to Illinois’ racial wealth space. We have been delighted that this legislation was finalized into legislation.”

The signing associated with the PLPA now starts up room for alternate lenders such as for example Capital Good Fund. “I am pleased that Governor Pritzker has had action to guard lower-income Illinois residents and degree the playing industry for equitable lenders like us,” claims Capital Good Fund creator and CEO Andy Posner. “As a nonprofit delivering loans that act as a substitute for high-double and triple-digit interest services and products, every single day we come across the tremendous damage done to families by predatory lenders.”

It offers an unique chance for company, faith, and community leaders to share with you more info on short-term loans. The PLPA advocacy team additionally developed a resource guide that can help borrowers in taking a look at their choices moving forward. For the time being, opposition teams and predatory loan providers are usually pushing“trailer that is hostile” and loopholes. Woodstock Institute therefore the PLPA coalition users continue steadily to break the rules on such efforts, including supplying this fact sheet for a loophole being backed by high-cost installment loan providers.

Among the list of lead businesses advocating for passage through of the PLPA are AARP, the Catholic Conference of Illinois, Chicago Urban League, Illinois People’s Action, Capital Good Fund, the Illinois resource Building Group, Heartland Alliance, Illinois PIRG, brand new America, Citizen Action/Illinois, the United states Fintech Association, and Woodstock Institute.

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