Payday/High-cost Loans

CFA Joins Orgs to Support Landmark Bill to Protect Consumers and Veterans from Predatory Lending

CFA joined 188 groups and academics representing all 50 states and the District of Columbia in a letter to the Senate Committee on Banking, Housing, and Urban Affairs in support of legislation that would establish simple, common-sense, and essential protections for veterans, unactivated reservists, and all consumers against predatory lending.

The Veterans and Consumers Fair Credit Act (VCFCA) is sponsored by Senator Jack Reed (Rhode Island), Senator Jeff Merkley (Oregon), and Chairman of the Senate Committee on Banking, Housing, and Urban Affairs Sherrod Brown (Ohio), as well as Senators Tina Smith (Minnesota), Cory Booker (New Jersey), Richard Blumenthal (Connecticut), Brian Schatz (Hawaii), Dianne Feinstein (California), Raphael Warnock (Georgia), Patrick Leahy (Vermont), and Ron Wyden (Washington).

The legislation reestablishes usury laws that existed in nearly every state throughout most of the 20th century and protects consumers from predatory lenders that have historically targeted vulnerable consumers including veterans, senior citizens, low- income consumers, rural consumers, and and communities of color. This landmark legislation was reintroduced on the heels of a bipartisan referendum on the harmful rent-a-bank model that is being used by predatory payday and installment lenders to make triple-digit interest rate loans that are illegal across the country.