For a long time, Utah has provided a great regulatory weather for high-interest loan providers.
This informative article initially appeared on ProPublica.
A Utah lawmaker has proposed a bill to end high-interest loan providers from seizing bail funds from borrowers that don’t repay their loans. The bill, introduced within the state’s House of Representatives this week, arrived in reaction up to a ProPublica research in December. This article revealed that payday loan providers as well as other high-interest creditors regularly sue borrowers in Utah’s tiny claims courts and just take the bail cash of the who will be arrested, and quite often jailed, for lacking a hearing.
Rep. Brad Daw, a Republican, who authored the brand new bill, stated he had been “aghast” after reading the content. “This has the aroma of debtors jail,” he stated. “People were outraged.”
Debtors prisons had been prohibited by Congress in 1833. But ProPublica’s article revealed that, in Utah, debtors can be arrested for still lacking court hearings required by creditors. Utah has provided a good climate that is regulatory high-interest loan providers. It really is certainly one of just six states where there are not any interest caps governing pay day loans. A year ago, an average of, payday loan providers in Utah charged percentage that is annual of 652%. Read more