CARSON CITY (AP) - Assembly Speaker Barbara Buckley says several companies are using a loophole to evade Nevada's payday loan laws,charging consumers interest rates of up to 900 percent.
Nevada's payday loan law, passed in 2005, allows lenders to
charge high rates for the term of the loan, usually two weeks or a
month. But after that, if a customer defaults, the law limits the
interest rate to about 18 percent in today's markets.
Six companies started using long-term contracts to avoid the
law, which only applies to short-term loans. Buckley declined to
name those companies before hearings are held in the Legislature.
Alfredo Alonso, a lobbyist for payday loan company Money Tree,
says his client supports regulation of the industry to eliminate
--quote-- "bad actors." He says Money Tree follows the current
rules and wants competitors to play by them too.
(Copyright 2007 by The Associated Press. All Rights Reserved.)