But payday lenders have a long history of making bad loans that trap people in a cycle of debt with outrageously high interest rates and unreasonable repayment terms.
Recently, the Consumer Financial Protection Bureau (CFPB) issued a new rule that is a good first step toward putting an end to some of these abuses. However, the new rule still falls short of truly meaningful reform that would stop payday lending companies from taking advantage of Nebraskans with low incomes.
Act now for fair lending policies!
You have a chance today to improve this rule and make payday lenders operate under fair policies for everyone. We’re asking you to leave a public comment and urge the CFPB to strengthen these reforms to stop payday lenders from using their same old tricks.
Here’s an example of a comment you could leave:
The CFPB must not let debt trap payday lenders continue business as usual. This proposed rule is a good first step, but it doesn’t go far enough to ensure that borrowers can repay the loan and still have enough money to live on. This rule would still allow lenders to charge any rate and set almost any repayment term. This will result in lenders continuing to make harmful, high-cost loans that trap consumers in a cycle of debt. The CFPB must change the proposed rule to include clear consumer protection standards, such as limiting installment loan payback to 5% of a borrower’s paycheck and giving borrowers a longer period of time in which to repay their loan.
You can help Stop the Debt Trap. Please urge the CFPB to strengthen their rules for true reform. With enough comments from people like you, we can make sure all Nebraskans have access to fair banking practices.
If you have experience using a payday lender, we want to hear your story. Email Nebraska Appleseed’s Kait Madsen or call 1-800-845-3746 and tell us your experience.