House Prepares to Legalize Payday Loans With 391%

Wednesday, April 8, 2009

nannyeyes

You have to admire the chutzpah of the U.S. House of Representatives led by Nanny “impeachment is off the table” Pelosi.

A House subcommittee wants to legalize so-called payday loans with interest rates of up to 391%. Lobbyists from the payday industry bought Congress’ support by showering influential members, including Chairman Luiz Gutierrez (D-IL) with campaign cash. Congressman Gutierrez is now playing good cop, bad cop with the payday industry, who is pretending to oppose his generous gift of a bill.

If this outrageous piece of legislation is passed, here’s a few examples of what loans repaid at 391% will cost the primarily poor and elderly borrowers who make up the bulk of the payday loan customer base:

a. $100 would be repaid in the amount of $391
b. $50 would be repaid in the amount of 195.50
c. $750 would be repaid in the amount of 2,932.50
d. And a loan of $2,000 would be repaid in the staggering amount of $7,820

After seeing members of the military fall victim to exorbitant payday loans, Congress in 2006 capped the interest for military payday loans at at 36% and fifteen states have similar caps or outright bans.

Congressman Gutierrez is competing with Congressman Joe Baca to see who can author the biggest giveaway to the industry. Baca’s legislation would allow rollovers, higher fees for online banks, and would preempt state laws banning payday loans.

Rep. Barney Frank needs to step up and punch Congressman Gutierrez in the face for shamelessly exploiting the poorest members of society who use these loans to pay for such items as utilities, food and rent.

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18 Responses to House Prepares to Legalize Payday Loans With 391%

  1. Gerry Wright says:

    This is absolutely absurd. Andy are correct, it hurts the poor, desperate and elderly the hardest. A friend of mine used to call it “legalized rape”. There is no reason for such outrageous fees and interest.

  2. Joe in Colorado says:

    Yes, yes. Exploiting the poor. It’s the American way.

  3. TOM339 says:

    If Rep. Luiz Gutierrez’ bill passes, he needs to be removed from office by the voters of Illinois who elected him. MoveOn and People for the American Way need to get involved.

    As far as Pelosi is concerned, she puts on the nice face, articulate and reasonable, but the reality is, she’s a bitch and a snake. Pelosi is not very bright and were it not for the fact Phil Burton died, she would be back in San Francisco hosting teas for the ladies in Pacific Heights.

    I thought the voters of San Francisco, the genuine progressive voters, might vote her out of office last November but for reasons I will never be able to understand, San Francisco loves this woman, and they rewarded her with two more years to do the bidding for corporate America and to treat the poor like slaves.

  4. feminazi says:

    391% interest? Rep. Gutierrez is a criminal. This is a clear example of the poorest members of our country being preyed upon by loan sharks while the Congress holds it hands out and takes lobbyist cash. What the hell do the Democrats stand for these days?

  5. Robbie says:

    A number of these stores are popping up in my neighborhood, so I know they’re profitable. We even have liquor stores that offer these services now.

  6. Brigadoon says:

    Chairman Luiz Gutierrez needs his ass kicked for ripping off the poor like this. Seriously, he needs to be shown some Southside Chicago love and sent on his way. Preferably, to a hospital.

  7. lea-lea says:

    That picture of Pelosi is an instant classic!

    I bet this is exactly what this bitch looks like when she crawls out of bed in the morning, her eyes all fucked up from the numerous visits to the plastic surgeon for Botox treatments.

    Seriously, I have just about had it with these turncoat Democrats pretending to be liberals.

  8. Gerry Wright says:

    I just wrote my representative. I would encourage all of you to do the same. And to tell as many people as you can to join in! Thank you Christopher for bringing this to my attention!

  9. bradfrmphnx says:

    Arizona voted to get rid of pay day loans in the last elections. I wonder if this could reverse that. Its getting tiresome having the federal government dictating to the states on everything. The religious rightwingnuts want an amendment to the constitution defining marriage as between a man and women only. Antiquated marijuana laws from the federal government makes it illegal to have medical marijuana that has been approved by some states. There are many more examples to get depressed by.

    I’m from the Federal Government and I’m here to help.

  10. Fran says:

    43 states have laws restricting these payday loan rates. Oregon put restrictions in place in 2006.

    Governor Ted Kulongoski signed Oregon’s payday loan restrictions into law, setting an interest cap of 36 percent and a minimum term of 31 days.

    “Predatory lending, which victimizes people who are already skating on thin financial ice, has no place in Oregon.”

    The result? Many predatory lenders left the state.
    Fantastic!

    The question is will a federal law override the 43 states individual laws that have banned the predatory lending?

  11. Arizona Leatherneck says:

    The poor, the elderly and the disabled are easy targets.

    Whether the criminal is a thug on the street with an illegal firearm, or an elected member of the U.S. Congress.

  12. Gerry Wright says:

    Has anyone else contacted their Representative? These places are all over the city in Indianapolis, but you will not find them in wealthy neighborhoods. It is obvious who they are targeting. If we don’t speak up, who will?

  13. Estacada says:

    This is one of the more appalling stories I’ve read.

    I’ve written my US Senator. He’s usually a good guy but he’s in the senate and not the House.

    If Pelosi lets this bill out of committee, she should be impeached.

  14. That is outright disgusting. Any dem who votes for this should be horsewhipped and run out of office. What is so disturbing is that this will most effect the poor and those who are already disenfranchised..

  15. And we wonder why W, Cheney walked, as will the bankers. Unfuckingbelievable. Except it’s entirely believable. We should distribute photo of Rep. Gutierrez outside of every payday loan shop and explain to the poor souls who have to use them why they are being robbed.

  16. Mauigirl says:

    This is reprehensible. Isn’t there a federal law against usury?

  17. libhomo says:

    Gutierrez definitely deserves a primary challenge over this one. What a corrupt politician!

  18. pitbullmortgage says:

    National Hard Money Conference hosted April 30th call 858-736-7788 for info or view 3hardmoneylenders . com

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