Ohio AG Goes After California Debt Settlement Companies

Debt settlement is basically debt collection by another name. Out of one side of their mouths, debt settlement companies promise creditors they will help them get paid. Out of the other side of their mouths, debt settlement companies promise consumers great “deals” to resolve their debts. In order to appear more effective (or trustworthy, maybe), many debt settlement companies go to great lengths to appear to be law firms, while putting WE ARE NOT YOUR LAWYER disclaimers in the small print to attempt to avoid violating unauthorized practice of law regulations.

At best, consumers spend a lot of money to get settlements they could easily have gotten themselves with a few phone calls. At worst—and far too often—consumers spend a lot of money and get nothing.

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Voters in Arizona and Ohio reject payday lending

Sarah Byrnes of Americans for Fairness in Lending is an occasional guest contributor to Caveat Emptor.

Great news for consumers and advocates – citizens in Ohio and Arizona voted on Tuesday, November 4th to reject payday lending.  Ballot measures proposed by the industry were soundly defeated in both states, showing that voters weren’t swayed by the industry’s deceptive advertising trying to convince them that payday lending isn’t predatory.  You can read more about these battles in this previous post.

This brings the number of states where payday lending is illegal or unfeasible up to 15, plus the District of Columbia.  Only 35 more to go!

The victories are particularly impressive because the grassroots campaigns fighting for consumers were grossly outspent by the industry.  In Ohio, consumer advocates were outspent 60 to 1, and still won by a 2 to 1 margin.   In Arizona they were outspent 90 to 1.  Also, this is only the second time in the history of Ohio referenda that a “yes” vote won, and as the Center for Responsible Lending puts it, “victory in this bellwether state sends a strong message to policymakers everywhere.”

Congratulations Ohio and Arizona!

Payday loan measures on ballots in Ohio and Arizona

Sarah Byrnes of Americans for Fairness in Lending is an occasional guest contributor to Caveat Emptor.

In addition to all the other excitement surrounding this election, Ohioans and Arizonans will get the chance to vote on payday loan protections on November 4.  If you live in either of those states and you read this blog, you have probably already figured out the consumer-friendly position on those measures (Ohioans, vote “YES” on Issue 5; Arizonans, vote “NO” on Prop. 200).

FYI, if you are somehow still undecided about the presidential election, check out AFFIL’s Voter’s Guide which spells out the positions of Senators Obama and McCain on credit cards, mortgages and foreclosures, bankruptcy, and other issues.

If you’re not from Arizona or Ohio but know folks who are, please make sure they can see through all the advertising hype the industry has paid for, and let them know what the measures really mean.  The Ohio Coalition for Responsible Lending and Arizonans for Responsible Lending have great websites on the ballot measures.  Here’s a sample what they say: Keep Reading »

Ohio Payday Lenders Caught Lying in Ballot Initiative Signature Drive

Payday lending interest rates forced down in Ohio

On Monday, Ohio Governor Ted Strickland signed a law capping payday loan interest rates at 28% and limiting borrowers to 4 payday loans per year.

Previously, payday lenders would charge interest rates close to 400%. Under the new law, they will be limited to 28%, which looks more like a (bad) credit card interest rate.

The payday lenders themselves complain that this will force them to close most of their stores and cost Ohio up to 6,000 jobs. Ohio’s Republican legislators have the answer for that:

However, Republican legislative leaders said Monday that any payday lending jobs that may be lost by the bill essentially aren’t worth trying to keep.

“We want to replace jobs that are taking advantage of people with jobs that help people,” said Ohio Senate President Bill Harris, an Ashland Republican.

So where should Ohioans turn if they are stuck and really need cash?

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