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May 05, 2010 12:10 AM UTC

BREAKING: Payday Lending Reform Wins Final Passage

  • 38 Comments
  • by: Colorado Pols

That’s the word we just got from the primary sponsor of House Bill 1351, Rep. Mark Ferrandino–the bill to regulate the excesses of the payday lending industry now goes to Governor Bill Ritter to be signed into law. As the longsuffering victims of payday lending spam campaigns in the comment threads of our blog, we are very proud witnesses of this moment.

What’s cool is how we at Colorado Pols are so often accused of manipulating the inner workings of Colorado politics, controlling the media, et cetera, and passage of payday lending reform after we became interested doesn’t exactly dispel our mystique.

That’s right, punks, let it be a lesson to you if you want to keep spamming us.

UPDATE: Statements making their way out now, liberal activist group Progress Now’s after the jump. As for opponents, the Denver Post’s Tim Hoover caught up with Rep. Larry Liston (R):

“This might only put a third of the industry out of business.”

Progressives Celebrate Passage of Critical Predatory Lending Regulations

After three years of fighting for reform, payday lending “loan sharks” must play fair

FOR IMMEDIATE RELEASE

Tuesday, May 4, 2010

CONTACT: Bobby Clark, Executive Director at 303-905-8375

DENVER: Responding to news that Colorado House Bill 1351, a bill to regulate excessive interest rates and onerous terms of the payday lending industry, achieved final passage in the House today by a vote of 33-32, ProgressNow Colorado Executive Director Bobby Clark offered the following statement:

“There are no words to adequately express the gratitude we, and progressives across Colorado, have for legislators who stood up to an onslaught of lobbyists for the payday lending industry and passed House Bill 1351,” said Clark. “For a decade, predatory payday lenders have abused an exemption granted them in Colorado’s usury laws and unfairly lured unsuspecting citizens into giving them tens of millions of dollars. Payday lenders brazenly offered 350% and higher interest rate loans on unemployment and Social Security checks, preying on taxpayers as well as Colorado’s most economically vulnerable citizens.”

“Each year, nearly 200,000 of our friends and neighbors in Colorado become trapped in a cycle of debt by payday lending products that pray on those most vulnerable in our community. The legislation just passed by the General Assembly is not perfect, but it is an important step toward providing far greater protection for our fellow Coloradans against these predatory lending practices. ProgressNow Colorado has fought for payday lending reform every time it has come before the legislature, and thousands of our members made phone calls and wrote letters in support of this legislation.”

“Thanks to the patience and persistence of Rep. Mark Ferrandino, the bill’s primary sponsor in the House, and the bridge-building efforts of key negotiators like Sen. Rollie Heath of Boulder, meaningful reform of predatory payday lending is now a reality. This bill will help break the cycle of debt and provide an alternative for consumers who need credit, keeping millions of dollars right here in Colorado’s economy–dollars that otherwise would be siphoned off by predatory lenders. It’s a huge win for progressives and consumers in Colorado.”

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38 thoughts on “BREAKING: Payday Lending Reform Wins Final Passage”

  1. You fuck with ColoradoPols, you fuck with the entire trailer park!

    Seriously, congrats to Mark Ferrandino and everyone in the process – legislators, lobbyists on the side of goodness & kindness, public interest groups, etc. Thank you all for doing a very good thing.

    1. The same four in the House that voted against it today voted against it two weeks ago: Benefield, Rice, Riesberg and Schafer. In the Senate, Newell (who co-wrote the amendment that changed the bill in a major way and then still voted against it), Tochtrop, Hodge.

      And for those of you who are counting: Rice, Benefield and Newell all took campaign contributions from Ron and/or Chris Rockvam, owners of Money Now and Ron is the president of the trade association in Colorado for payday lenders. Just FYI.

      1. Newell was NOT a sponsor of the amendment in the Senate; she had said on April 27 that she was working on the amendment “with the industry” but when the amendment came up on April 29 her name was not on it.

        1. I have to say I am a bit surprised by Rice. I don’t know much about him just that this kind of vote is surprising.

          Thanks Awen for the information.

          1. I’m not surpirised by Joe Rice’s vote.  He’s done this on other legislation I’ve followed, including being the only Dem to vote against repeal of the CO capital gains freebie.  Everyone will say he’s in a tough district, but what’s the point when you can’t depend on his vote.  Maybe Dems should try to get someone better in there.

  10. And amazingly enough, AZ has a hardcore law in place on payday lenders and none of the dire predictions/threats we’ve heard in the last 3 years have occurred to the industry there.

  13. Who worked to pass this bill! It’s hard to believe so many of their predatory practices were actually legal to begin with. Kudos to Rep. Ferrandino and everyone who made it happen.

        1. Then this analysis of the Senate bill applies:

          The bill passed by the Senate would require lenders to make loans for six months at a time instead, and to give borrowers the flexibility to repay earlier. Lenders would be able to charge a $75 origination fee in the first month followed by monthly fees of $7.50 per $100 borrowed-up to a maximum of $30-and up to 45 percent annual interest. Under those terms, a borrower would pay $337.50 to borrow $500 if they waited until the end of six months to pay.

          From http://www.denverpost.com/sear…

  15. I want to thank Coloradopols, and everyone who wrote in support of HB 1351.  You played a key role in helping this bill get to the Governor’s desk.  This legislation will help to end the cycle of debt, and put consumers in the drivers seat of their financial situations.

    I also want to thank my colleagues who stood up for this bill with me, especially my Senate sponsor Senator Romer, and former President Groff who sponsored a similar bill with me in 2008.  This was a tough battle at the Capitol, and it took support and help from many legislators behind the scene to pass this reform.

    Lastly, I want to thank the payday lending reform coalition who provided the community support and research that was needed to pass this legislation.

    Thanks

    Mark Ferrandino  

      1. You mean 135% APR (the lowest APR under this new Bill) isn’t fantastic?

        Profile in Courage??????

        The way I see it, it’s much closer to a consumer “Bay of Pigs” than “PT109”.

        Apparently they don’t make politicians like they used to.  

        1. Before this passed, the argument has been that any regulation at all will destroy the industry. If that doesn’t happen, future legislatures can tinker with the details. It’s always easier to adjust the regulations once regulations exist.

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