Lawmakers can expect pressure to cap interest rates for car title lenders.
The Free Lance-Star reports that Del. Joe Morrisey, D-Henrico, is drafting a bill that would cap the annual interest rates of car title loans at 36 percent. Currently, most car title lenders have an interest rate of nearly ten times that amount.
In addition to Morrisey’s efforts, various faith-based and anti-poverty organizations have banded together to form the Virginia Partnership to Encourage Responsible Lending. The coalition, whose mission includes educating the public about high interest loans, is urging the General Assembly to amend the Consumer Finance Act so that it applies to car title lenders. Currently, most car title lenders are exempt from the cap because they offer open-end credit.
The group is also advocating for payday lenders to be regulated by the Consumer Finance Act.
By Sarah Rodriguez