Wisconsin Bill Would Cut Down on Payday Loan Sharks
State Rep. Josh Zepnick (D-Milwaukee), a member of the Assembly Committee on Financial Institutions, has introduced two consumer protection bills designed to help citizens who utilize relatively new and emerging financial services of cash advances and auto title loans.
“Payday and auto title loans are largely unregulated in the state of Wisconsin and even the industry itself recognizes that there are bad actors or abusive lenders which are not good for anyone in Wisconsin,” Zepnick said.
“Check cashing, wire transfers and more recently payday cash advances and auto title loan stores tend to cater to a clientele that is seeking short-term solutions to serve their immediate financial needs vs. building a long-term relationship with a bank or credit union.”
Zepnick’s payday advance loan lending bill would limit the amount someone could borrow at any one visit to a payday lender; restrict the number of “rollovers” and discourage turning the payday advance into a long-term loan.
Zepnick said the bill would prohibit the state from creating a database of payday loan borrowers, a “Big Brother invasion of personal privacy.”
The second bill would ban auto title loan outlets from doing business in Wisconsin.
“The practice of borrowing against a depreciating asset, especially one that has a wide variance in tangible value depending on the vehicle condition and history, is dangerous and is financially dubious considering the flooded used vehicle market,” Zepnick said.
“There are some responsible actors in all of the above services - now is the time for them to step forward and help work on much needed public policy changes before they get lumped into the same sinking boat of predatory and irresponsible [no faxing payday loan] sharks.”