Payday Loan Industry Watch Home News: Archive News: Recent News: RSS Newsfeeds News: Archive News: By State News: By Big 7 Podcasts Reviews Tips Links
About Us
Contact Us
Site Help
Find a Lender

Oregon payday loan shops under fire from officials

December 13, 2005 - Portland, Oregon

Legislators, activists and a Portland city commissioner say they will move to further limit practices of the hundreds of "payday loan" offices across the state.

The number of businesses has mushroomed in recent years, and 70 companies now operate 356 payday or auto loan shops across the state, frequently charging interest rates of around 512 percent for quick short-term.

On Feb. 15 Portland Commissioner Dan Saltzman says he will introduce a law to regulate the lenders in the city.

"These loans are taking advantage of people in need and people who have no other place to turn," he said.

Rep. Jackie Dingfelder, D-Portland, is meeting with Ecumenical Ministries of Oregon, the Oregon Food Bank and others to find ways to tighten controls.

Rep. Debi Farr, R-Eugene, and Sen. Floyd Prozanski, D-Eugene, each lead interim consumer committees considering more rules.

Our Oregon, a political nonprofit, is taking steps toward an initiative drive to cap interest rates.

The groups say they are not trying to ban the businesses but want to curb high interest rates that make it difficult for borrowers to clear the debt.

The businesses made 2.9 million loans in Oregon over the past five years and sued some 12,000 Oregonians, most of whom could not keep up with the interest.

Loan operators say use of their services is a matter of choice and some don't mind paying more for fast easy access to cash.

Lenders say the loans are typically for two weeks, making the cost less than most banks charge for a bounced check. The law requires the interest rate to be prominently posted.

Oregon is among only seven states with no interest caps and is considered payday-loan friendly, said Jean Ann Fox, director of consumer protection for the Consumer Federation of America.

"The solution is for states to reimpose their usury and small-loan laws," she said. "Usury laws are to protect the needy from the greedy."

The 2003 Legislature adopted some regulations but put no cap on interest and allowed borrowers to roll over payments with added fees, which can mount up quickly and make repayment difficult.

Both Washington and California cap loan fees at $15 per $100 and do not allow rollovers.

Consumer advocates say states should go beyond regulating lenders and encourage banks and credit unions to offer low-interest alternatives. Some already do.

After taking out four short-term loans, Ruby and Ronald Stoker of Junction City rapidly sank into debt this year.

"We were taking out loans to pay back loans," said Ruby Stoker, 35, who has five children. "We were starting not to pay our rent so we could pay a loan."

They turned for help to O.U.R. Federal Credit Union in Eugene, which converted the Stokers' short-term loans into one fixed-rate loan with monthly payments.

The credit union has made it part of its mission to help people trapped by short-term lenders, said Loretta Moesta, president.

"We stop the bleeding immediately," she said. "Then we start dealing with the long-term issues to make sure they don't go back again."

News Source

KATU 2 (Consumer News Section), as reported by AP News

Related Stories - Oregon


See: Recent News | Archived News | RSS Newsfeeds | News by State
Go to home.

E-mail This Page Open a new window and send this page to a friend.
Share this page by E-mail.
Podcasts Podcasts page.
Interview with David Farias - Founder,
Payday loan opponents caution people against taking payday loans. We interviewed David to better understand the practice and viability of an emerging source for loans: The Internet social lending network.

Interview with Pete Kowenhoven - Special Agent, FBI
Interview with Dr. Tom Lehman - Author of 'In Defense of Payday Lending'
Interview with Bill McCloskey - Email Data Source President and CEO
Reviews Reviews page.
July 21 - WeGiveCash claimed we could get $1,500. But, after entering qualifying customer information, we were declined and then forwarded to another Web site to re-apply.
Find a Lender Find a Lender page.
Claims to lend
To residents of
With fees per $100 loaned
On the Web since
reviewed by PLIWatch
small payday loan industry watch logo
Recent RSS Newsfeeds Archive Shown by State Shown by 'Big 7'
Home News & RSS Podcasts Reviews Tips Links Find a Lender About Us Contact Us Donate / Sponsor Site Help
Terms of Use Privacy Policy Site Map copyright © 2005-2023 all rights reserved Updated: Nov 22, 2022 07:57 EST