SPRINGFIELD, Ill. – In an effort to protect consumers from predatory loans that target low-income communities, State Rep. Emanuel “Chris” Welch, D-Hillside, has introduced legislation that puts restrictions on extreme auto loan title lending practices.
“The predatory practices being used by these lenders trap lower-income folks in a cycle of debt that’s nearly impossible for them to get out of,” Welch said. “The extreme interest rates—some as high as 360%—are unfair and quite frankly unethical. It’s time to rein these predatory lenders in and protect consumers.”
Under current law, some lenders were able to offer nearly unregulated car title loans due to a loophole in the law. Welch’s legislation, House Bill 2468, would close this loophole and caps the interest rate that may be charged to consumers. The measure passed out of the House Executive Committee with strong, bipartisan support and awaits further action on the House floor.
“The way lenders operate currently puts consumers at a severe disadvantage,” Welch said. “This measure will level the playing field and help put an end to loans and rates that unfairly target lower-income communities. I am encouraged by the bipartisan support that this measure has received and look forward to continue working with my colleagues on both sides of the aisle to protect consumers and get this legislation signed into law.”
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