Conference calls are “modern wear and tear”.
What seems like a quick and easy solution to paying an emergency bill until the next payday has turned out to be a nightmare for many people. Payday loans or car title loans can help fill a financial void in a person’s life, but if the borrower is not careful, the interest on the loan can skyrocket and put into much more debt. .
Recently, Catholic advocates and others have stepped up their support for legislation that seeks to protect borrowers from crippling interest rates.
“Payday loans are modern wear and tear. These short-term, high-interest loans tackle the financial hardships of poor and vulnerable consumers, all in the interest of big profits, which only arise when consumers fail. This practice directly contradicts our Catholic understanding that the role of the economy is to serve people, not the other way around, ”the Montana Catholic Conference told voters, urging them to contact a local representative to support the Act. the 2019 Veterans and Consumers Fair Credit (HR 5050).
Payday loans are a quick fix that often makes things worse for borrowers
The conference explained that the bill would put a 36% APR interest rate cap on all payday and auto title loans. Payday loan interest is sometimes said to be compounded over 300%
“HR 5050 extends the rate cap of the Military Lending Act – which currently only covers active duty military personnel and their families – to veterans and all consumers,” the Montana conference said. “This means that loan sharks would not be able to charge exorbitant triple-digit interest rates on their deceptive loans.”
The United States Conference of Catholic Bishops Committee on National Justice and Human Development recently signed a letter from the Faith for Just Lending Coalition in support of HR 5050. The letter to Congress says that the 36% APR rate cap “has been proven to work. The Military Loans Act prohibits lenders from charging military service members and their families more than 36% APR. The limit was proposed by the Defense Ministry after finding that high-interest loans were devastating troops’ finances and hurting the readiness of the forces. It was enacted with strong bipartisan support in 2006. ”
“The scriptures condemn usury and teach us to respect the dignity given by God to each person and to love our neighbors rather than exploit their financial vulnerability,” the letter says. “So the simple act of lending is a matter of biblical morality and religious concern. Equity and dignity are values which must be respected in all human relations, including commercial and financial relations.