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Lawmaker seeks interest restrictions on pay day loans

Lawmaker seeks interest restrictions on pay day loans

A Comanche County legislator would like to yank the reins on exorbitant cash advance rates of interest.

Home Bill 2864 by Rep. Daniel Pae would impose a limitation on rates of interest assessed on pay day loans of $2,000 or less.

No loan, agreement or nationwide recognized bank card is allowed to charge an yearly portion price (APR) more than 10% regarding the Federal Reserve discount price, HB 2864 stipulates. The re payment terms on payday loans in Hawaii any loan, credit or contract card exceeding that limit could be “unenforceable,” the cash advance Prohibition Act would decree.

The Federal Reserve discount price is just how much the U.S. bank that is central its user banks to borrow from the discount screen to keep up the book it needs.