An organization called CLOUT is pushing a 36% rate cap.   Doesn’t look like it’s going anywhere.   From the article:

Several attempts have been made in recent years to impose tighter restrictions on interest rates for Kentucky’s payday lending industry, but most have not been successful. One current piece of legislation, House Bill 444, would create a computer database to monitor high-cost loans and make sure that borrowers don’t have more than two such loans at a time.

A House committee approved the bill earlier this week with no interest rate changes, but an amendment was filed Thursday by State Rep. Jim Glenn, D-Owensboro, creating a 36 percent cap — the same limit sought by CLOUT. Kursman said such a limit would amount to “prohibition” for the industry, and wouldn’t allow Check ‘n Go to even cover the cost of utilities in its stores. For every $15 charged on a loan, he said $13 is spent on overhead, loan defaults and other items.

An employee at a payday lending story in Kentucky has a letter in the Louisville Courier Journal today:

It isn’t even a fair measurement to calculate payday loans using APR, anyway. Using that logic, bank overdraft fees and credit-card late fees would seem astronomical, too.

The fees our stores charge pay for my salary and benefits, taxes and rent, just like any other business. Payday advance lenders provide short-term loans to people who need help and are good members of the local business community. Lowering the limit on what we can collect for our service will hurt families, and that’s not right.

As many of you know, there was legislation introduced in Congress today that affects payday lending.  As there are no news articles so far to comment on, we’re waiting for electronic links to the legislation as well as feedback from industry officials.

Please keep checking back here for more.

The Wall Street Journal asks economists to tell people what to do with with $8 per week in stimulus money they will get.  We liked this one:

If you’re stuck for ideas, just keep on using ATM machines, owned by other banks, so you can pay large fees to take out small sums of money from your checking account. When you need to, take all of your withdrawals and deposit them back in the account once again and start all over with the process.

Well, the radical columnist at the State (S.C.) Newspaper calls himself one, but we prefer to think of him merely as a misguided ideologue.   You can read his column and judge for yourself.

The Irresponsiblelending site is very popular with our readers.

Yes, everyone is discounting these days.   See the latest at Walletpop.

They are lumped together in an article about legislation heading to the desk of Virginia Governor Tim Kaine.  From the article:

Gov. Timothy M. Kaine said today he would veto legislation passed by the General Assembly yesterday that would allow holders of concealed weapons permits to bring their hidden guns into establishments that serve alcohol. “I’m very nervous about the public safety impact of that bill,“ the governor said on his monthly call-in radio show on WRVA in Richmond. Kaine also reiterated his intention to sign recently passed legislation to impose a statewide ban on smoking in public restaurants that do not have a separately ventilated areas for those wishing to light up. And the governor signaled that he would endorse a further legislative crackdown on the payday lending industry, which sidestepped a law passed last year that was supposed to rein in lending practices that reaped large profits while allowing borrowers to dig themselves deeper into debt.

Gee, at least the reporter doesn’t editorialize at all.  

From the article:

The compromise bills would limit the size of a payday loan to 30 percent of a person’s monthly income or $700, whichever is less. They would also bar people from having multiple loans at different payday companies, and set up a database to track the number of loans taken out by people.

The bill also enacts an installment plan for people who fall behind on their loan payments that would allow customers to have up 90 days to pay back a loan of $400 or less, and 180 days for a loan of more than $400 without a fee. Currently, a borrower has 60 days and must pay fees.

The bills are getting lukewarm responses from both sides of the issue.

Compromises usually get lukewarm responses.

If you haven’t checked out the Irresponsiblelending.org., site you should.