ACORN is taking it to the streets of 14 cities on Thursday.  From the story:

But let’s not forget that ACORN helped to cause the mortgage bubble by strongarming banks into making loans they shouldn’t have. And cheering them on was ACORN’s lawyer, Barack Obama, who contributed to the increasingly hostile environment for banks when he represented plaintiffs in the 1995 class action lawsuit Buycks-Roberson v. Citibank. The suit demanded that Citibank grant mortgages to an equal percentage of minority and non-minority mortgage applicants. The bank settled the case three years later and reportedly agreed to beef up its lending to unqualified applicants.

Kentucky Youth Advocates  say consumers use payday loans because they don’t have other options.  So the group calls for banning payday loans.   Obviously, they failed high school logic class.   From the story:

Many of the participants also said they were distrustful of all financial institutions because of fees associated with banking.

Steven Schlein, a spokesman for the Community Financial Services Association of America, a short-term-lending trade group, said the survey does not adequately reflect the experiences of most payday loan users.

“We have tens of thousands of customers in Kentucky and very few complaints,” Schlein said.

The report suggests that Kentucky create alternatives to payday loans, such as the “Save It! Loan” program run by the Mountain Association for Community Economic Development and the Appalachian Federal Credit Union. The program offers 10-month loans with a cash savings account.

Other recommendations include using churches to increase financial literacy and encouraging banks and the government to reach those who are distrustful of banks. The report also calls for a cap on payday-loan interest rates.

But Schlein of the trade group said the survey found that many people go to payday lenders because traditional financial services won’t serve them. A 36 percent cap on interest — which has been proposed — on payday loans would shut down many short-term loan operations, leaving people with no options, he said.

“They are contradicting themselves,” Schlein said.

The paper supports the Consumer Financial Services Protection Agency:

In principle, it could be wise to streamline the consumer protection function by taking it away from agencies whose other responsibilities may have conflicted with it. The Fed, which had both consumer protection and bank solvency duties, admits that it was too slow to rein in subprime loans. Another useful focus of such an agency would be simplifying the eye-glazing disclosure forms borrowers now face when they buy a house or sign up for a credit card. Still, even financial literacy is no guarantee: Many of Mr. Madoff’s pigeons were sophisticated business people.

That’s not very enthusiastic.

Regarding the story yesterday about VA payday loans being down 80%:

Nice spin. The numbers of loans has dropped 80%. That is the number that were reported by legal, licensed lenders, but how have the number of loans changed by unregulated, unlicensed lenders on the internet? Only a fool would believe that those 80% magically found salvation and no longer have a need for short-term credit!!!

Only this time, they’re targeting pawn shops: 

La Grange plan commission officials voted Monday to ban pawn shops in its core downtown district after residents and shop owners complained the business would tarnish the town’s polished new image.

No mention of the needs of consumers.

But PDLindustryblog beat me to it.

From the story: 

Payday lending — Lenders will be required to choose between offering payday loans, whose fees are fixed, and open-ended loans, which can carry sky’s-the-limit interest rates. Lenders getting out of the payday business would lose their licenses to offer such loans in Virginia for a decade.

Why give consumers any options at all?  Virginia legislature is going after title lenders now.  From the story:

A legislative study committee held their first meeting today at the state Capitol. At the meeting they will discuss how to approach regulation of car title lenders during the 2010 General Assembly session.

Car title lenders operate under the state’s open-end credit law, which allows them to impose whatever loans terms they want as long they do not charge anything during the first 25 days.

Since Virginia passed laws against payday lending, the number of loans has dropped more than 80 percent from the previous year.

All discussed at PDLindustryblog.

It will be interesting to see who testifies in opposition to the Consumer Financial Services Protection Agency:

Wednesday, July 15, 2009, Full Committee Hearing: Financial Regulation and Restructuring

Thursday, July 16, 2009, Full Committee Hearing: Financial Regulation and Restructuring

Friday, July 17, 2009, 2009, Full Committee Hearing: Financial Regulation and Restructuring