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To endorse the passage of fair and reasonable consumer protections on predatory lending that will reduce poverty and create safer and stronger communities in Washington State.
Payday lenders typically charge more than 390% interest (APR), taking fees out of the pockets of working families to the tune of almost $200 million annually in our state. Overwhelmingly marketed toward low to moderate income families and communities of color, these small-dollar loans are designed with terms borrowers usually cannot meet, forcing them into high-cost, long-term debt.
Nearly one-third of states now protect consumers by limiting allowable interest rates to 36 percent or less. Nationally, Congress capped the annual percentage rate at 36% to protect all military families. At a time when working families need every penny to help meet their basic needs, Washington borrowers need access to small-dollar loans they can successfully repay. A reasonable loan product with normal interest rates will help people through tough economic times. Washington lawmakers should extend the 36% interest rate cap to protect all families.
2. Lending should help build a future, not destroy it with triple digit interest rates and downward spirals of debt.
3. It is unjust to prey upon anyone based on race, economic status, age, health, or immigration status in order to make a profit.
4. Communities must work together to prevent the charging of exorbitant interest rates and fees.
5. We call on the Legislature to protect consumers from predatory payday loans.