The Indy Star has an article entitled Groups unite to fight predatory lending which focuses on loans secured against one’s house that are purposely structured to be such that the borrower cannot afford the payments, resulting in default and foreclosure.
In a potentially related matter, I saw that Senator Paul has introduced SB 70 which sets charges for small consumer loans.
Provides that for a supervised loan of at least $100 but not more than $1,000, a lender may charge both: (1) an acquisition charge of not more than 10% of the principal amount; and (2) a monthly installment account handling charge based on the amount of the loan; instead of the finance charge that otherwise would apply to a supervised loan.
I don’t have enough time this morning to determine whether SB 70 effectively allows an increase in such loans or whether this is merely shuffling the charge from one form into the form of acquisition charges and monthly installment accounts.
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