. - Alabama lawmakers are making another attempt for reform in the payday and title loan industry. More individuals and organizations in Alabama are becoming more aware of predatory lending practices in the state. This increased awareness is prompting many to support the need for major reform.
Alabama Arise is vocal when it comes to the serious problem payday loans create for residents here in the state.
"We see people who take out payday loans, take out several loans in a row, and get trapped in a cycle of debt and poverty," said Dev Wakeley, Policy Analyst with Alabama Arise.
This is why the non-profit supports Senate Bill 138, sponsored by Senator Arthur Orr. Instead of 10 to 14 days, a borrower gets to repay payday loans the bill would give them 30 days.
"It will put these bills on the same cycle that people pay for everything else. You pay your mortgage every 30-days. You pay your light bills every 30-days. This would allow people to pay their payday loans every 30-days," said Wakeley.
Church leaders are also weighing in on the issue and calling for change.
"That would be a great first step in making the situation better for everyone," said David Graves, United Methodist Bishop of the Alabama West-Florida Conference.
The topic of predatory lending was the focus of a seminar this week at Frazer Memorial UMC. The program was sponsored by the AWF Conference Board of Church & Society. Among the speakers was Bishop Graves.
"In the United Methodist Church we are very much so into social justice and to speak to those who do not have a voice. We feel and I personally feel that way," said Bishop Graves.
The belief is only the legislature can act to put an end to the triple digit interest rates charged by these industries and other practices many consider unfair.
"It continues to put a burden on their back. When you have difficulty making day to day and week to week month to month and you have a high interest rate it just makes the circumstances even worse," said Bishop Graves.
Not everyone supports the bill. Jaime Fulmer, Senior Vice President of Advance America sent WSFA 12 News the following statement:
Alabama has more payday lenders than any other state.
Preliminary Data for 2017 from the Alabama State Banking Department:
- Payday loans opened: 1,813,974
- The total advanced amount: 609.1 million
- Total fees: 106.2 million
- Average loan amount: $335.78
- Number of customers who opened at least one pay day loan: 215,325