Comments on: Obenshain’s LoanMax bill http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/?utm_source=rss&utm_medium=rss&utm_campaign=obenshains-loanmax-bill Harrisonburg's Community News Network Mon, 26 Mar 2012 22:09:32 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: David Miller http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-64583 David Miller Mon, 09 Feb 2009 23:10:53 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-64583 from whsv http://www.whsv.com/home/headlines/39184192.html A House of Delegates committee has killed a bill that would have cracked down car title lenders. Del. Joe Morrissey's bill would have capped the annual interest rate the lenders could charge at 36 percent. Currently, car title lenders charge 25 to 30 percent interest each month, and when borrowers fall behind they lose their vehicle. Morrissey likened the lenders to loan sharks, and said they pray upon those who can't get traditional credit. Opponents said they provided a needed service to those who don't qualify for credit cards or other loans. A similar bill in the Senate is expected to come up for a committee vote next week. from whsv
http://www.whsv.com/home/headlines/39184192.html

A House of Delegates committee has killed a bill that would have cracked down car title lenders.

Del. Joe Morrissey’s bill would have capped the annual interest rate the lenders could charge at 36 percent. Currently, car title lenders charge 25 to 30 percent interest each month, and when borrowers fall behind they lose their vehicle.

Morrissey likened the lenders to loan sharks, and said they pray upon those who can’t get traditional credit. Opponents said they provided a needed service to those who don’t qualify for credit cards or other loans.

A similar bill in the Senate is expected to come up for a committee vote next week.

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]]> By: Kyle http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22516 Kyle Thu, 17 Jan 2008 01:11:07 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22516 Gee, imagine that, Virginia trying to regulate predatory practices. Something many other states have done a long time ago. Like everything else Virginian, 20 years behind. Gee, imagine that, Virginia trying to regulate predatory practices. Something many other states have done a long time ago. Like everything else Virginian, 20 years behind.

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]]> By: robert http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22504 robert Wed, 16 Jan 2008 20:08:40 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22504 Mr. Miller has a curious understanding of market conditions. I always thought that competition drove the price (interest) downward. Seems like a basic ecomonic theory to me. Mr. Miller has a curious understanding of market conditions. I always thought that competition drove the price (interest) downward. Seems like a basic ecomonic theory to me.

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]]> By: David Miller http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22213 David Miller Sat, 12 Jan 2008 22:23:20 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22213 Peter I disagree with a few of your points. First; as Lowell pointed out, these bills will not run “anyone out on a rail”. These bills are designed to appease us. That’s all. Unfortunately they are inadequate at appeasing anyone since they solve nothing. Second; Your assertion that “if someone could come along and offer these type loans at a better rate, it would’ve been done by now”. That’s not how capitalism works. If someone can get away with making this much money and charging this rate of interest then they are going to (have no illusion about it, it is interest because interest and fees are one and the same according to the IRS, The World Bank, The US Government and the Catholic Church, to name a few). Plain and simple. Peter
I disagree with a few of your points. First; as Lowell pointed out, these bills will not run “anyone out on a rail”. These bills are designed to appease us. That’s all. Unfortunately they are inadequate at appeasing anyone since they solve nothing. Second; Your assertion that “if someone could come along and offer these type loans at a better rate, it would’ve been done by now”. That’s not how capitalism works. If someone can get away with making this much money and charging this rate of interest then they are going to (have no illusion about it, it is interest because interest and fees are one and the same according to the IRS, The World Bank, The US Government and the Catholic Church, to name a few). Plain and simple.

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]]> By: Lowell Fulk http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22157 Lowell Fulk Sat, 12 Jan 2008 02:49:07 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22157 Lender.... Sorry for the spelling blunder. Lender…. Sorry for the spelling blunder.

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]]> By: Lowell Fulk http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22156 Lowell Fulk Sat, 12 Jan 2008 02:47:51 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22156 I would submit,... The lendor... I would submit,… The lendor…

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]]> By: Lowell Fulk http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22155 Lowell Fulk Sat, 12 Jan 2008 02:47:04 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22155 Let’s see…. If Joe Sixpack has a car that is valued at $2,000.00, it qualifies him to borrow $1,000.00. So if he takes advantage of this opportunity, at the end of the first month he will be required to pay back the $1,000.00, plus $200.00 in interest. If, as might be expected, (since he couldn’t come up with the money he thought he needed to begin with, and it would seem hard to come up with a spare $300.00 per week for repayment) he needs to roll it into the second month, it will cost him another $200.00 in interest to pay himself out of debt. At three percent interest per month for the remaining ten months of the year specified, if Joe continues to not have enough money to pay off his loan, he will have accrued interest of another $300.00 bringing his total interest for borrowing $1,000.00 to $700.00. And this is if the interest is only applied to the original amount borrowed…. If however, which is not spelled out in this bill, the interest is applied to the total amount of the carryover, as is done with credit cards, then each time the loan is continued, the previous interest is included as principal, so therefore the next interest is figured on a greater amount… So, by the time the end of the year rolls around, when his car has depreciated in value compared to the original valuation for purposes of the loan,… Joe now finds that his car is of less value that what he owes… Who benefits from this dance???? Let’s see….

If Joe Sixpack has a car that is valued at $2,000.00, it qualifies him to borrow $1,000.00.

So if he takes advantage of this opportunity, at the end of the first month he will be required to pay back the $1,000.00, plus $200.00 in interest. If, as might be expected, (since he couldn’t come up with the money he thought he needed to begin with, and it would seem hard to come up with a spare $300.00 per week for repayment) he needs to roll it into the second month, it will cost him another $200.00 in interest to pay himself out of debt.

At three percent interest per month for the remaining ten months of the year specified, if Joe continues to not have enough money to pay off his loan, he will have accrued interest of another $300.00 bringing his total interest for borrowing $1,000.00 to $700.00. And this is if the interest is only applied to the original amount borrowed….

If however, which is not spelled out in this bill, the interest is applied to the total amount of the carryover, as is done with credit cards, then each time the loan is continued, the previous interest is included as principal, so therefore the next interest is figured on a greater amount…

So, by the time the end of the year rolls around, when his car has depreciated in value compared to the original valuation for purposes of the loan,… Joe now finds that his car is of less value that what he owes…

Who benefits from this dance????

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]]> By: David Miller http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22136 David Miller Fri, 11 Jan 2008 23:14:02 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22136 Phil I think that the federally capped APR of 36% is fair. Fair to the lenders. Phil
I think that the federally capped APR of 36% is fair. Fair to the lenders.

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]]> By: Peter Westcombe http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/comment-page-1/#comment-22129 Peter Westcombe Fri, 11 Jan 2008 21:30:17 +0000 http://hburgnews.com/2008/01/10/obenshains-loanmax-bill/#comment-22129 It seems like the focus of this legislation is to run these businesses out on a rail, and not on providing better alternatives to the people who need the money bad enough to take out these loans. I think Cory has a point that if someone could come along and offer these type loans at a better rate, it would've been done by now. It seems like the focus of this legislation is to run these businesses out on a rail, and not on providing better alternatives to the people who need the money bad enough to take out these loans. I think Cory has a point that if someone could come along and offer these type loans at a better rate, it would’ve been done by now.

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