Vote ignores strong opposition from military, state officials, consumer advocates
DURHAM, N.C., June 3, 2011 /PRNewswire-USNewswire/ -- A North Carolina bill that would significantly increase the interest rates of loans made by consumer finance companies like CitiFinancial and American General narrowly passed the House of Representatives yesterday evening by a vote of 61-54. The vote on House Bill 810 came despite a broad coalition opposing the effort to raise interest rates on consumer loans that included North Carolina military base commanders, the state's Governor and Attorney General, consumer groups and civil rights leaders across the state.
This bill was passed even though three study commissions in four years -- including an exhaustive study the Commissioner of Bank submitted at the request of the legislature -- found that changes to the Consumer Finance Act are unwarranted. In fact, the Commissioner's study found that 80 percent of finance companies turned a profit over the past 10 year period, including during the worst of the financial downturn.
"The legislature chose to put the needs of consumer finance companies ahead of working families and the military today. This bill is unnecessary and will do great harm to consumers and military personnel at a time when we can least afford to hurt either," said Chris Kukla, Senior Counsel for Government Affairs at the Center for Responsible Lending.
The Center for Responsible Lending is a nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices. CRL is affiliated with Self-Help, one of the nation's largest community development financial institutions.
SOURCE Center for Responsible Lending
