Ask your members of Congress to support a 36% cap on annual interest for consumer loans
Payday loans carry an annual interest rate of 391 percent and are so difficult to pay off that many borrowers end up paying more in interest than they originally borrowed.
Payday lenders flip their loans to the same borrowers many times per year, either by rolling them over for another term, or closing them out and re-opening them. The terms set borrowers up for failure.
- For a $500 loan at 36% APR, fees are $180 over one year
- For a $500 loan at 391% APR, fees are $1,955 over one year
Twelve million Americans are caught in the trap every year. Their payday lending stories illustrate the damage caused by the debt trap. The average borrower pays back $800 for a $300 loan, a loss of $500 that goes purely toward interest.
Payday loans trap borrowers in long-term debt.
Make 400% interest illegal.
Talking Points
- 12 million Americans are caught in a cycle of 400% interest payday lending debt every year
- A 36% interest rate cap is the only measure that has successfully reformed payday lending in 15 states
- A 36% interest rate cap would save $5 billion per year in abusive payday lending fees
- Working families need their cash and our economy needs it to go to productive uses
- A 36% cap is a significant financial reform that would cost taxpayers nothing
Dear [ Decision Maker ],
Please support the Protecting Consumers from Unreasonable Credit Rates Act (S500/HR 1608).
(Edit Letter Below)
Please provide content for your letter
Sincerely,
[Your name]
[Your address]
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