Alabama legislators seek limits on payday loans

Alabama legislators seek limits on payday loans

March 4th, 2013 by Associated Press in Local - Breaking News

By PHILLIP RAWLS

MONTGOMERY, Ala. - Several Alabama legislators are proposing bills to place restrictions on payday and title loans, including capping the interest rates.

Legislators say their bills would limit annual interest rates at 36 percent. The loans can now have annualized rates of 456 percent on payday loans and 300 percent on title loans.

Democrat Ron Scott of Fairfield says he's optimistic about passage because the bills have a broad range of support, including the Southern Poverty Law Center, NAACP, AARP and Arise Citizens' Policy Project.

President of the industry group Borrow Smart, Max Wood of Birmingham, says the low interest rates would cause the businesses to close.

Jera Smith, an employee of a title loan business in Birmingham, says the company works to helps consumers - not harm them.