Rep. Responds to Payday Loan Bill Changes; Promises New Focus on Payday Advance Lending
By J.J. CameronPayday Loan Writer
Greg Oder represents the 94th District in the Virginia House of Delegates. In an unusual move, he struck down his own payday loan bill last month.
In a recent letter to The Daily Press, Oder defended this course of action. He assured readers that future action would be taken on payday loans.
Here's an excerpt:
I have received some questions regarding my decision to strike the payday lending regulations bill that I was presenting on the floor of the House of Delegates. I have already committed to submit the original payday lending bill I carried this year again in 2007. This legislation will impose significant regulations on the payday lending industry.
Unfortunately, the original bill I submitted this year failed to pass the House Finance Committee by one vote. As you can imagine, my original bill was strongly opposed by payday lending representatives. Simply put, they won and Virginia lost.
Therefore, in an effort to get some victory for Virginia, I convinced the committee to reconvene at the final hour and vote on a less restrictive bill. Although this new bill provided additional regulations that do not exist today, it did not provide the restrictions and oversight provided in the original bill. It was the best hope to provide some regulations given that the original bill had not passed the full committee.
As I presented the new bill on the floor of the House, I realized that many delegates supported my original bill. Through discussions with these delegates, we jointly decided that if we passed the less restrictive bill this year, it would be difficult to come back in 2007 with more restrictive regulations … At the end of the day, I agreed to a strategic move to strike my less restrictive bill and regroup for 2007, when I will submit the original legislation that will truly provide meaningful regulation to the payday lending industry.
The most significant change that will be required by this legislation will be the formation of a statewide database. The database will provide a tracking mechanism to prohibit a lender from providing a payday advance to anyone who has three outstanding loans with payday lenders. Citizens with outstanding loans will be listed in the database.
Additionally, borrowers will be required to wait until the next business day to acquire a new loan after paying off a loan. Finally, failure to comply with these two provisions, as well as the other proposals in the law will result in a $1,000 fine to the lender per violation.
Rest assured that I will submit legislation to effect significant changes to the payday lending industry in the 2007 session of the Virginia General Assembly. In fact, I have already requested legislative services to draft the bill.
