Statement on Military Lending Act Rule Change

Early this morning it was announced that the Military Lending Act has been updated to close loopholes to better protect military families from predatory lenders. Communities Creating Opportunity has worked extensively on the issue of predatory lending. Our statement is below.

QUOTE:

“We applaud this strong step forward. Payday lenders have demonstrated repeatedly that they lack the moral restraint necessary to build a strong economy where everyone has a fair shot. The only drawback to this legislation is that not every American will get to enjoy its benefits – if military families need protection from predatory lenders, all our families do.”

Rev. Harold Johnson, Communities Creating Opportunity

CONTEXT:

  • Communities Creating Opportunity is a faith-based community organizing nonprofit in Missouri and Kansas that works extensively in communities afflicted by predatory lenders.
  • In response to community pain, in 2012 CCO and its grassroots allies spearheaded a massive campaign to cap the interest rate on payday loans to 36% APR. The industry fought a fierce and dirty campaign in response: http://www.propublica.org/article/how-high-cost-lenders-fight-to-stay-legal
  • The current average interest rate of a payday loan in Missouri is 455% APR.
  • Earlier this year, CCO and the faith community in Missouri successfully stopped the passage of an industry-sponsored sham reform bill that would have set maximum interest rates at 900% APR.
  • The payday lending industry relies heavily on lobbyists and campaign contributions in order to stay legal – donating millions of dollars.
  • Recent actions by the Consumer Financial Protection Bureau have revealed new and disturbing information about many prominent payday lending and online lending companies. (ACE Cash Express, Corinthian, the Hydra Group)

FOR MORE INFORMATION:

Contact Andrew Kling, 816-920-0370, andrew@cco.org

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