The latest word on The new payday loan laws is not looking very good for the consumers.
Just as the new laws were gearing up to start protecting borrowers they seem to have been put on temporarily on hold by the Trump Administration.
Let’s take a look at what is going on!
The New Payday Loan Rules
Awhile back the Consumer Financial Protection Bureau created new laws making payday loan companies practice more strict lending practices.
We ran a blog on this titled: “The Latest Payday Loan News: New Payday Loan laws Announced”
You can also check out their complete PDF on these laws by clicking here.
After President Trump appointed former Republican Rep. Mick Mulvaney as the head of the Consumer Financial Protection Bureau it seems all bets are off for any of these new laws to stand a chance.
It seems they have all been put on hold indefinitely as part of an internal power struggle the Trump administration is in to gain control of the bureau.
Watch groups are upset and are pointing fingers and claiming foul!
They claim those campaign contributions given to Mr. Mulvaney during his last election campaign when he was South Carolina’s Representative as the reason for the favorable gift of suspending these new laws.
They also claim he has also dropped a lawsuit against payday loan lenders who were charging upwards to 900% interest on their two-week loans.
According to Mike Calhoun who is the president of the Center for Responsible Lending, this man is the last person that should be in charge of this bureau.
He has in the past introduced legislation to terminate the CFPB completely and has a history of taking payday loan companies contributions.
Because he has taken $60,000 plus in cash from these companies while he was in congress dictates he is going to side with these companies.
While this is bad news for borrowers and good news for the lenders maybe with a bit of luck these new payday loan laws still may still stand a chance.
They are to be revisited soon by the bureau Mr. Mulvaney is only an appointee and could be replaced.
Various non-profits and watch groups have gone on record saying if he should try to make these laws permanently go away they would file lawsuits in favor of the laws.
Hopefully, this will all work out in a way that helps to protect the borrowers and levels the playing field a bit.
Most people who can not get a regular loan are going to continue using these services regardless of the cost and these companies know this and do exploit it.
Let’s hope more will be done to help the borrowers continue to be able to find help without paying an arm and a leg for it.
Watch groups and nonprofits will never give up on doing the best they can to help the people who need it and that is good to know.
We will be sure to keep our eyes out for any new developments in this story!
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