The Louisiana Installment Loan Act would expand the pay day loan industry in Louisiana by enabling payday loan providers and automobile title loan providers to provide longer-term вЂњinstallment loans.вЂќ Installment loans are similar to high-interest payday loans, but allow borrowers to get bigger loans for extended amounts of time. The installment loans will never change current pay day loans, but could be a completely brand brand new item with a high prices for people that create a much greater danger that borrowers can get caught when you look at the predatory lending financial obligation trap.
Payday loan providers in Louisiana currently make high-interest loans of $50 to $350 that really must be paid back within 60 days. The bills that are proposed also enable loans from $500 to $1,500, with repayment durations enduring from six months to 1 year. The middle for Responsible Lending determines that a $500 loan, repayable over half a year, would carry a 245 % percentage that is annual (APR), whenever all costs are included. For the $1,000 loan due in year, payday lenders would gather a lot more than double exactly just what they provide. Continue reading “Installment Loan Act Would Expand Predatory Lending in Louisiana”