I’m writing because you have the power to end rent-a-bank schemes that are letting unscrupulous banks charge needy Americans interest rates of up to and over 600%.
Short-term consumer loans are a scourge, preying on the needs of families on the brink of bankruptcy. 12 million Americans turn to these loans each year, hoping to get a leg up at a difficult time. Instead, they often get locked into a predatory system; the typical borrower ends up taking out eight loans in a year.
These kinds of lenders are disproportionately concentrated in Black and LatinX neighborhoods.
Even though 45 states and DC have put at least some cap on the interest rates all around the nation, banks skirt these laws by laundering their high-interest loans through rent-a-bank schemes that render these state regulations toothless. Congress needs to act to help states protect their neediest borrowers.
The Veterans and Consumers Fair Credit Act would grant all consumers the same loan protections the federal government already provides to active members of the military. It would cap interest rates at 36%, giving families a much better chance at climbing their way out of debt.
Please co-sponsor this vital legislation and keep money in the pockets of American families. Thanks!
▶ First sent on June 22, 2022 by Jess Craven