The administration trump will remove restrictions on «fast» loans, popularly referred to as the «to pay». During the Obama presidency, these loans were prohibited, are considered predatory because of the high interest rates and unscrupulous as they allow you to cash in on people who are in difficult life situations or, for example, drug addicts and drunks.
CFPB wants to roll back Obama-era restrictions on payday loans https://t.co/PubaRInxrD pic.twitter.com/VZa3ffnb72
— New York Post (@nypost) February 6, 2019
The idea to revive this loan opportunity arose in the White house at about the same time with advent Mick Mulvaney, who replaced Richard Cordray, who banned such loans.
Existing rule requires creditors offering loans on the same day for a short time to figure out if a borrower can afford to repay the loan. In cases where the evidence of solvency is not (the most cases), the Bank has no right to give the loan. However, in many countries the lending of the insolvent gold mine, as the Bank insures its own interests by a lien on the car or other assets. Often people who have received such a loan then be deprived of housing.
Bureau of financial consumer protection CFPB, made a proposal return fast loans in the business turnover, insists that such loans make financial resources more accessible to a wide range of borrowers. Cordray, now fighting for the post of Governor of Ohio, said the administration’s actions trump favor the enrichment of the banks which affected consumers:
«The loan without considering the borrower’s ability to repay it is irresponsible and often predatory. Today’s actions by the CFPB should be subject to stringent legal disputes.» Politicians, bankers, lawyers and consumers have 90 days in the discussion of the solution CFPB.
Katie Kraninger, Director of the CFPB is ready for this debate: «I look forward to working with colleagues from state and Federal regulators to enforce the law against bad players and promote the fierce market competition to improve access, quality and cost of credit for consumers.»
Senior researcher of the project on consumer financing, the Pew Charitable Trusts Alex Horowitz, believes that because of changes to the rules of the 12 million Americans who use loans to pay annually will not be protected from predatory interest rates, which average 400 percent:
«This proposal is not an amendment to an existing rule, it is a complete dismantling of the protection of consumers, is completed in 2017. The rule worked. Lenders have made changes before it officially entered into force, more safe loans have already begun to arrive, and harmful practices began to disappear.»
