Legislature looking at car title lenders « Virginia Lawyers Weekly

Legislature looking at car title lenders

By News in Brief
Published: July 6, 2009

A lawyer representing several car title lenders says that only about 5 percent of borrowers who fall behind in repaying their loans lose their vehicles.

A legislative panel studying the high-interest loans met for the first time last week. It must rely on statistics from attorney Dewey Morris and other industry representatives because the businesses are unregulated in Virginia.

Car title lenders operate under the state’s open-end credit law, which allows them to charge whatever they want as long as they don’t charge anything for the first 25 days.

Industry opponents have asked legislators to cap the interest the lenders can charge at 36 percent annually, but legislators put off the issue to give the committee a chance to study it this summer.