by Dr. John Whitley and Rev. Charles Swadley; Planning Team, James River Chapter, Virginia Interfaith Center for Public Policy
It is time to protect the most vulnerable folk in this heightened environment of health and economic crisis. One huge policy change is addressing the exorbitant interest rate charges and fees demanded by predatory lenders.
The General Assembly passed the Fairness in Lending Act (HB789 and SB421) to limit the high interest rate to 36% plus a fixed fee. Today (Wednesday, April 22), the General Assembly will consider this legislation as part of the reconvening of the Virginia General Assembly to address Governor Ralph Northam’s amendments and vetoes.
Governor Northam’s amendment to the Fairness in Lending Act is to enact it on January 1, 2021 instead of July 1, 2021. The date change will save $50 million to borrowers, according to the Virginia Poverty Law Center, Executive Director, Jay Speer. He stated:
“Borrowers critically need those savings for living expenses and the Virginia economy will benefit from this money going into local economies rather than into the pockets of out-of-state predatory lenders. The Virginia Fairness in Lending Act is an evidence-based, comprehensive approach to reforming the Commonwealth’s broken small-dollar lending laws. Once enacted, this legislation will ensure widespread access to credit with affordable payments, reasonable time to repay, and fair prices — prices more like what many lenders charge their customers in other states. By moving up the timeline, we will allow responsible lenders who offer affordable credit to enter the Virginia marketplace sooner.”
We ask our state senators and delegates to support Governor Northam’s amendment.
Protect the voiceless and desperate citizens who would be further victimized by misleading offers of “easy” financial loans at high interest and fee rates. Put fairness back into the picture sooner rather than later.