Home Budget, Economy General Assembly Approves Accelerated Effective Date for Consumer Lending Reforms

General Assembly Approves Accelerated Effective Date for Consumer Lending Reforms

"Change comes after Herring asked Governor Northam to move the effective date up citing the need to better protect Virginians during these difficult financial times caused by COVID-19"

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From AG Mark Herring’s office:

GENERAL ASSEMBLY APPROVES ACCELERATED EFFECTIVE DATE FOR CONSUMER LENDING REFORMS

~ Change comes after Herring asked Governor Northam to move the effective date up citing the need to better protect Virginians during these difficult financial times caused by COVID-19 ~

RICHMOND (April 22, 2020) – Following Attorney General Mark Herring’s letter to Governor Northam asking for an accelerated effective date for important comprehensive reforms aimed at curbing predatory lending practices, the General Assembly has moved the effective date for these reforms up to January 2021. In his letter, Attorney General Herring asked that the effective dates for House Bill 789 (Delegate Lamont Bagby) and Senate Bill 421 (Senator Mamie Locke) be moved earlier citing the need to better protect Virginians during these difficult financial times brought on by the COVID-19 pandemic.

“This is great news for the many Virginians finding themselves in a tough financial situation because of COVID-19 and who may turn to small-dollar loans in order to make ends meet,” said Attorney General Herring. “These consumer lending reforms will close easily abused loopholes and provide much needed protections for Virginia borrowers. I’m glad I was able to help get the effective date for these important bills moved up so that Virginians who take out these small dollar loans during this difficult time can be better protected.”

The legislation tightens the rules on exploitative predatory lenders and closes easily abused loopholes so that Virginia borrowers are afforded protections regardless of the type of loan they seek. It will also give Attorney General Herring’s Predatory Lending Unit more tools to enforce these new protections and better combat predatory lenders operating in the Commonwealth.

Attorney General Herring has made it a priority to protect Virginians from predatory lenders. He created the OAG’s first Predatory Lending Unit to investigate and prosecute suspected violations of state and federal consumer lending statutes, including laws concerning payday loans, car title loans, consumer finance loans, mortgage loans, mortgage servicing, and foreclosure rescue services. The Unit also focuses on consumer education so Virginians are aware of the potential risks of these loans, as well as alternatives.