Sen. Durbin, 30 other senators call for stringent predatory lending rules
U.S. Sen. Dick Durbin (D-IL) and 30 other senators offered their support Thursday for the steps taken by the Consumer Financial Protection Bureau (CFPB) with regard to new rules to prevent predatory practices in payday and similar types of lending, and urged the agency to issue stringent rules to combat the onslaught of devastating financial consequences that such highly priced loans have on consumers.
“We support the CFPB’s initial steps towards releasing a proposed rule and urge you to issue the strongest possible rules to end the damaging effects of predatory lending," the senators said, in a letter to CFPB Director Richard Cordray. "Small dollar, short-term loans with astronomical interest rates that pull consumers into a cycle of debt are predatory. These loans have high default rates, including after the borrower has already paid hundreds or thousands of dollars because of triple-digit interest rates. Even if consumers do not default on these loans, high interest rates, preauthorized payment methods and aggressive debt collection efforts often cause a cascade of devastating financial consequences that can include lost bank accounts, delinquencies on credit cards and other bills and bankruptcy.”
Other U.S. Senators authoring the letter include Jeff Merkley (D-OR) and Chris Coons (D-DE). The letter was signed by Sens. Tammy Baldwin (D-WI), Richard Blumenthal (D-CT), Cory Booker (D-NJ), Barbara Boxer (D-CA), Sherrod Brown (D-OH), Maria Cantwell (D-WA), Ben Cardin (D-MD), Dianne Feinstein (D-CA), Al Franken (D-MN), Kirsten Gillibrand (D-NY), Martin Heinrich (D-NM), Mazie Hirono (D-HI), Tim Kaine (D-VA), Angus King (I-ME), Amy Klobuchar (D-MN), Patrick Leahy (D-VT), Edward J. Markey (D-MA), Chris Murphy (D-CT), Gary Peters (D-MI), Jack Reed (D-RI), Bernie Sanders (I-VT), Brian Schatz (D-HI), Chuck Schumer (D-NY), Jeanne Shaheen (D-NH), Debbie Stabenow (D-MI), Tom Udall (D-NM), Elizabeth Warren (D-MA), Sheldon Whitehouse (D-RI) and Ron Wyden (D-OR).