SCOTUS to weigh in on case with implications for Virginia predatory loan law
The United States Supreme Court is now considering a case that has many people worried about a return of predatory lending in Virginia.
Back in 2020, the General Assembly passed the Fairness in Lending Act, which essentially kicked car title lenders and payday lenders out of Virginia. But, Jay Speer at the Virginia Poverty Law Center says predatory lenders are still out there, and Virginia needs the help of the federal Consumer Financial Protection Bureau to stop them.
"The problem is that there are still some lenders, typically teaming up with banks from Utah and that sort of thing, on the internet giving people loans that don't follow our law," says Speer. "And, we need the CFPB to put a stop to this."
Last week, justices of the United States Supreme Court heard oral arguments in a case brought by a coalition of payday lenders challenging the constitutionality of the CFPB. Nadine Chabrier at the Center for Responsible Lending says the lawsuit was prompted by a rule that would have protected consumers.
"Payday lenders would have been required to consider a consumer's ability to repay a loan, and they would have been subject to limits on repeatedly attempting to debit consumer accounts to collect the payday loan," Chabrier says. "So, these were very simple and reasonable requirements but payday lenders filed a suit to stop this."
Advocates across Virginia are watching this case closely and the court is expected to rule in the next few months.