City officials are protecting citizens from predatory lending
Cities across Oregon are taking the lead to help more families avoid the debt trap created by high cost payday loans. Commissioner Dan Saltzman sponsored the first local payday loan reform ordinance in Portland. Portland City Council unanimously passed the ordinance on February 22, 2006.
The list of cities that have passed local payday loan reform include:
Beaverton
Bend
Eugene
Gresham
Oregon City
Portland
Silverton
Troutdale
Wood Village
The city ordinance will:
- Establish the right to a payment plan for borrowers who have reached the maximum rollovers;
- End interest only payments by requiring payment on principal before each rollover; and
- Allow for the opportunity to cancel the loan within 24 hours without penalty
Payday Loan Reform around Oregon
Because the state law does not go into effect until July 2007, there is still an urgent need for city level reform to provide immediate relief to Oregon families.
Here are some basic facts about the local ordinance
- When the state law goes into effect will it cancel out the city ordinances?
- No, not at all. As passed, the state law compliments the city laws. The state law does not include the provisions outlined in model city ordinance. Cities are prohibited from capping the interest rate. That can be changed only at the statewide level. The combination of the city regulations and the new law will make Oregon one of the most consumer friendly states in the country for payday borrowers.
- Who supports payday loan reform?
- Local residents and payday loan consumers are part of the broad coalition of nonprofits and community leaders working to pass payday loan reform at the state and local level. Coalition partners include AARP, OSPIRG, Our Oregon, Ecumenical Ministries of Oregon, Lutheran Advocacy Ministry of Oregon, Oregon Catholic Conference, SEIU, Oregon Hunger Relief Task Force, Oregon Food Bank, FOOD for Lane County and local food banks around the state are continuing to work with local governments and state lawmakers to pass laws that protect citizens against predatory lending.
Download a fact sheet the local ordinance
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