MI Group seeks to change payday loan interest rate
LANSING, Mich. (WLNS) – The typical interest rate in Michigan right now for payday loans or short-term loans is 370%.
The rate is an issue that a group wants to change.
“We have modeled our campaign on several other states that have recently approved payday loan reform and are proposing to cap interest rates at no more than 36%,” said Josh Hovey, spokesperson for the Michiganders For Fair campaign. Lending.
That 36% figure is about the same as a high-interest credit card.
The group says current corporate payday rates are hurting struggling families.
A recent study by the Center for Responsible Lending indicates that the average person who takes out a payday loan will need to take out 10 other loans just to keep up.
“They will immediately pay once and not have enough money to cover the rest of their bills and so it will become this endless cycle of debt,” Hovey said.
Today, more than 400,000 signatures have been officially scanned and delivered for review to be included on the November ballot.
Fans say it shows the Michiganders support the change.
“We believe this reflects what we already knew to be true from the hearts of the citizens of this state, that they want to see consumer protections within this industry and we believe we are taking a big step to make that happen. produce today,” said the director. of Project Green, Dallas Lenear.
Once the signatures of the petition have been validated by the Board of State Solicitors, the legislator will then have 40 days to approve the initiative.
“When you break the debt cycle, people are able to support their families better, they have less income to pay off high-interest debt,” Hovey said.