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State attorney general wants Northam to speed up consumer lending reforms

Added 04-06-20 12:23:02pm EST - “Virginia Attorney General Mark Herring is urging Gov. Ralph Northam to accelerate the start date of consumer lending reforms, which he says is to protect Virginians from predatory lending practices during the COVID-19 pandemic.” - Washingtonexaminer.com

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Posted By TheNewsCommenter: From Washingtonexaminer.com: “State attorney general wants Northam to speed up consumer lending reforms”. Below is an excerpt from the article.

Virginia Attorney General Mark Herring is urging Gov. Ralph Northam to accelerate the start date of consumer lending reforms, which he says is to protect Virginians from predatory lending practices during the COVID-19 pandemic.

“Virginians who find themselves in difficult financial situations because of the coronavirus pandemic may be forced to turn to high interest loans in order to make ends meet during this time,” Herring said in a news release.

The reforms, which are expressed in Senate Bill 421 and House Bill 789, are scheduled to go into effect July 1, 2021, if Northam signs them as is. Herring is asking Northam to move the start date to July 1, 2020.

The bills prevent interest and fees on short-term loans from exceeding 36 percent on an annual rate and increases the loan maximum from $500 to $2,500. They also require that such loans are between four months and two years, although there are some exceptions. They prohibit the collection of fees and charges that exceed 50 percent of the original loan if the loan is less than $1,500 and 60 percent of the original loan if it is higher.

“This comprehensive legislation will close easily abused loopholes and tighten the rules on exploitative lenders so that Virginians are more protected from falling into a vicious cycle of debt and high interest rates,” Herring said. “I am asking the Governor to amend the effective date for these bills so they can go into effect sooner and protect those Virginians who may need to take out short term loans during this difficult time.”

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