Loan Industry Reforms in Alabama Are Underway
The Alabama Legislature is ready to start reforming payday and title loan industry after the same effort were broken down on the final session in 2016.
Senator Arthur Orr is the only one who fights in the Senate.
These kinds of loans are widely spread in Alabama state.
Dr. Neal Berte from Birmingham-Southern College spoke about loan reforms last Monday at a press-conference in Redstone Federal Credit Union in Huntsville.
He noticed that Alabama was the most dreadful state in the US where no major reforms were made both for title and payday loans.
Nowadays the situation is the following: the interest rate for the payday and title loan is 300 percent but it can be higher up to 456 percent if there are missed payments or refinance.
The Alabama State Banking Department has a special database of payday loan figures taken between October the 1st 2015 and September the 30rd 2016. So, 239.000 people in Alabama took payday loans on the sum of $668 million dollars.
Mr. Orr said he would never want to put payday lenders out of the business or stop giving loans away for citizens. Orr is one of the authors of the Bill 284 where first steps taken to allow borrowers having more days to repay a loan.