The Louisiana Installment Loan Act would expand the cash advance industry in Louisiana by enabling payday lenders and automobile title loan providers to provide longer-term вЂњinstallment loans.вЂќ Installment loans act like payday that is high-interest, but enable borrowers to get bigger loans for longer amounts of time. The installment loans will never change current payday advances, but could be a totally brand new product with high costs for people who create a much greater danger that borrowers can get caught when you look at the lending debt trap that is predatory.
Payday loan providers in Louisiana currently make high-interest loans of $50 to $350 that really must be paid back within 60 days. The proposed bills would additionally enable loans from $500 to $1,500, with payment durations lasting from a few months to 1 12 months. The middle for Responsible Lending determines that a $500 loan, repayable over 6 months, would carry a 245 % percentage that is annual (APR), whenever all costs are included. For the $1,000 loan due in one year, payday loan providers would gather a lot more than double just what they provide. Continue reading “Installment Loan Act Would Expand Predatory Lending in Louisiana”