Six Big City Mayors Call for Crackdown on Payday Lenders in Ohio
Columbus Mayor Michael Coleman and five other big city mayors in Ohio are calling on state lawmakers to crackdown on payday lending practices. Coleman and the others want caps placed on the rates charged by payday lenders.
"We want to make sure that the legislature provides some legislation so people are not taken to the cleaners when they need a loan," says Coleman.
A bill supported by the Ohio Coalition for Responsible Lending would place an annual rate of 36 percent on loans from payday lenders.
The payday lending business model currently uses an average 391 percent annual rate. Critics say the businesses are dependent on trapping customers in debt by forcing them to take out additional loans to pay off previous loans. (Copyright 2008 by The Associated Press. All Rights Reserved.)