Relief In Sight For Payday Loan Borrowers
Now, there is news to cheer about for all payday loan sufferers of Arizona State. According to a legislation approved by the House, all the payday loan borrowers who could not repay the loan would be given some more time to pay back their loans. As per this bill, all the borrowers who have been unable to pay back their loan within the stipulated time period would be provided an extended time limit up to 12 weeks to repay the loan. Most importantly, no interest fees or additional penalties would be charged for this period.
The SB1446 legislation needs a final roll-call vote before the bill is sent to the senate for approval. This bill, if introduced, would prohibit the process of ‘rollover’ where the lender coerces the borrower for another two week credit at an additional 15 percent interest rate if he is unable to repay the loan within the stipulated two week period. But, SB1446 does not make any amendments in the existing laws wherein the borrower can avail a payday loan up to $500 for a period of two weeks at an interest rate of 15 percent.
According to Rep. Chad Campbell, D-Phoenix, this facility can be availed by all the borrowers. Most legislators in Arizona had been against it when these payday loans were introduced in 2000. Some of the legislators including Rep. Marian McClure, R-Tucson, are in the process of pursuing for enforcing an issuance of statutory ban on these types of predatory lending processes. But, there are certain legislators such as Rep. Bill Konopnicki, R-Safford, who have a different opinion. According to them, these payday loans are a means of filling financial gaps during emergency situations.
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