Colorado Attorney General Phil Weiser is among state prosecutors urging the Trump administration to adopt new protections for those taking out payday loans.
He is one of 25 attorneys general who this week signed a letter urging the administration’s Office of Consumer Financial Protection to stop postponing guarantees for debtors.
Those who take on expensive short-term loans often have poor credit histories which sometimes lead to a compound debt spiral due to high interest rates.
The new regulation “would ensure that they (debtors) have the ability to repay loans while prohibiting lenders from using abusive tactics when seeking repayment,” Weiser’s office said in a statement. hurry.
To read the letter, click here.
The rule was supposed to go into effect last year, but enforcement has been postponed to August 19, 2019, and more recently to November 19, 2020, as the office considers revising the rule.
“We need to protect borrowers in Colorado and across the country from unfair and predatory payday lending practices,” Weiser said in a statement. “The CFPB proposes to delay the provision on repayment capacity without adequate justification.
“It is essential that the CFPB protect US consumers by holding payday lenders accountable and protecting vulnerable borrowers from skyrocketing costs and inevitable default. “
Colorado voters capped the interest rate on payday loans at 36% last November. Before that, the average interest rate on payday loans in Colorado was 129%, Weiser’s office said.
Weiser signed the letter with prosecutors in California, Connecticut, Delaware, District of Columbia, Hawaii, Iowa, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota , New Jersey, New Mexico, Nevada, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Wisconsin and Washington.