For nearly six years, Virginia Organizing has joined with many other organizations in urging the members of the Virginia General Assembly to stop predatory lenders and the financial trap they set for people in dire financial circumstances.
In 2008, a payday loan bill was enacted with provisions that fell far short of the needs of Virginians; it only helped reduce, not stop, the abusive financial practices of payday lenders. Our efforts to end predatory lending in Virginia include continuing to fight payday loans and other predatory lending products. Predatory car title loans and completely unregulated open-end loans avoided the laws enacted in the Payday Loan Act and took over where payday loans left off.
In 2010, the Virginia General Assembly enacted legislation providing some reforms to car title lending, helping protect consumers from this financial trap. The legislation was not perfect due to the high interest rates permitted, but was considered a major victory because it included time limits on the loans, interest rate caps, notices before cars can be repossessed, more information provided to borrowers and licensing requirements for lenders. Unfortunately, in 2011, lawmakers expanded car title loans to allow out of state vehicle owners to receive loans in Virginia, a slap in the face to surrounding states that have ended predatory lending operations and a way to profit from the exploitation of desperate families.
Virginia Organizing joins organizations throughout the Commonwealth in supporting a 36% annual interest rate cap on all loans in Virginia, a measure that will end predatory lending once and for all.