Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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Transcript of Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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LendingLendinge to Close the Lo
ay n
in Texas
in Texasphole and Level te
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ARTICLE 16. GENER
Sec. 11. USURY; RATABSENCE OF LEGISL
The Legislature shall have au
maximum rates of interest; pr
absence of legislatioof interest all contrac
annum shall be deemfurther, that in contracts wher
upon, the rate shall not exceannum.
L PROVISIONSOF INTEREST IN
TION.
thority to define interest and fix
ovided, however, in the
fixing maximum ratests for a greater rate of
ed usurious; provided,e no rate of interest is agreed
d six per centum (6%) per
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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TITLE 4. REGULATION OFINANCED RAN ACTION
342: CONSUMER LOANS
Sec. 342.007. DEFERTRANSACTION
Passed in 2001
INTEREST, LOANS AND, UBTITLE HAPTER
ED PRESENTMENT
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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CommiCommi Governed by the Finance C
Sets interest rates and fee
Regulates the market by -
Licensing Lenders
Enforcing Texas Law
Educating Consumers a
Communicating Among
sioner sionerommission of Texas
d Credit Providers
he Industry and Public
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Prior to 2005, payday le
Texas usury laws.
When that loophole wasthe industry found a nethe regulations containe
.
ders in Texas partnered
closed by federal action,loophole in order to avoid in the Texas Finance
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re erv cere erv ceAS FINANCE CODE, TITLE 5
F FINANCIAL SERVICES
PTER 393 CREDIT SERVI"Credit services organization"
the following services with resp
dit by others:
improving a consumer's credit histo
providing advice or assistance to a.
d in 1997 and intended to reguluals repair or improve credit.
rgan za organ za o
: PROTECTION OF CONSUM
ES ORGANIZATIONSmeans a person who providesct to the extension of consume
y or rating;
onsumer with regard to Paragraph (
ate organizations that help
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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ho gets the moneyho gets the money
CSO or PLend
CSO or PLend
$60.0$60.0
out of $361.06out of $361.06
BorrowerBorrower
00.0000.00
The CSO Act sets
ydayrydayr
F nanc aInstitutionF nanc a
Institution
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00 Paydayn made on
th
4/25/2010(2 weeks)
Rollover
5/9/2010
(4 weeks)
Rollover5/23/2010(6 weeks)
Rollover (8 weeks)
Rollover6/20/2010(10 weeks)7/7/2010
ees and Interest
$61.06 $361.06
$61.06 $422.12
$61.06 $483.18
$61.06 $544.24
$61.06 $605.3
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nua ercnua erc
52
n age a en age a e
%
Titl LTitl L RR
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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r Title Loar Title Loa,000 Auto-
March 22nd
Date
4/21/2010
Rollover 5/21/2010
Rollover 7/20/2010
Rollover 8/19/2010
RepaymeRepayme
Charged mount
$1,269 $5,26
$1,269 $6,53
, ,
$1,269 $9,07
$1,269 $10,3
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38
==
%
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Numbers & Graph (Ann
In 2006 - 1,279 CSOsIn 2010 - over 3,594 reg
Thats more locations th
.
B. will finish)
egistered in Texas.istered.
n McDonalds and
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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Average number of CS
.
Highest Number 45 Rep
geographic district in th
MAPPING for All House
Example:http://www.co
tx/house_94_patrick/ma
locations per House
. Hochberg, the smallest
state.
and Senate Districts
munitywalk.com/arlington
p/555986
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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olutions
sv e
drdson
e
ntonioe
o
County
County
an Basis Regional Council
Zoning Ordinances
rv ng
RichardsonLittle Elm
Garland
MesquiteSachse
San Antonio
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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& Level the& Level the
0 by Rep. Tom Craddick
6 by Rep. Joe Farias
1 by Rep. Eddie Rodriguez
laying Field laying Field
SB 253 by Sen. Wendy D
SB 251 by Sen. Royce W
vv
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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v .v .
Payday Loan
Existing Lending
Law
CSO Lo
Charges
0 loan)$15.60 $60
135%
(14-day term)
521
(14-da
ral Post-Dated Check Post-Dat
ht
Yes N
id to State$100
Cor o
Car Title Loans
ophole Existing
Lending Law
CSO Loop
00 $22.00 $75.00
%
term)
89%
(30-day term)
304%
(30-day te
d Check Car Title Car Titl
Yes No
per
ation
$100 p
Cor orat
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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ongress passed, and Pres.George
en lending to members of the armed
254 by Sen. Wendy Davi
Fair Lending and the 500% Interest i
ederal law is enforced in Texas.
. Bush signed in to law, new regulatiorces and their immediate family. Te
s
Wrong Coalition support efforts to in
es eg s aes eg s a
ve pproacve pproac
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7/31/2019 Payday and Auto Title Lending in Texas: Time to Close the Loophole and Level the Playing Field
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es eg s aes eg s a
revious legislative attempcreated a new regulatoryand fees, duplicating wh
Finance Code.expressly exempted CSregulations
Did not include regulation
: wayday and car title lendervoid necessary consumer
eferenced today ARE the
ve pproacve pproac
ts at regulation -scheme, including ratest is already in the Texas
s from the newly created
s for auto title lenders
,will be able to continue t
protections. The bills
ompromise.
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at our Faith Trat our Faith Tr
brew scriptures:
t deal with them as a creditor; ym. (Exodus 22:25)
ristian scriptures:Luke 6:34 And if you lend to teive, what credit is that to you?
ck the same amount.
amic scriptures:
And what you give in interest tople's wealth, increases not wit
ditions Teachditions Teach
, ,
u shall not exact interest from
ose from whom you expect toEven sinners lend to sinners, t
hat it may increase on otherAllah (God). (Q'uran 30:39)
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.stoppaydayabuse.org.stoppaydayabuse.org www.texasfaithforfairlendi