Ohio Payday Situation Gets Interesting.
Matt Burns of Business First of Columbus had a very nice article today on the situation with the Ohio Payday Ballot.
According to Burns,, Ohio officials have finally finalized the ballot language for the Payday Issue.
The Ballot will read: “Shall Section 3 of H.B. 545 be approved?” A “yes” vote keeps intact the provision of the law, which caps annual interest rates on payday loans at 28 percent, down from 391 percent, while limiting the maximum loan amount to $500, from $800.
A “no” vote, according to the language, sets the maximum loan amount back to $800 and allows payday lenders to levy a total charge on a loan that “substantially exceeds” 28 percent. According to Burns, the 391 percent annual percentage rate calculation doesn’t appear on the ballot.
It looks like a Payday Group called Ohioans for Financial Freedom have worked to collect signatures to make sure the repeal makes it on the ballot. They called the language “fair and balanced.” According to Burns, Ohioans for Financial Freedom has until the end of the month to collect and submit more than 241,000 valid signatures to ensure a spot on the ballot.
Stay Tuned my friends. Ohio is in the middle of it.
It seems our legislators like to “re-define” their powers and the terms of their duties. Instead of “regulating the state” they are driving away businesses….
Lets do the math here on a payday loan….You borrow $100, you pay $15 for that 100 dollars and pay it back. APR 15%
Opposing Representatives that probably failed their first year of algebra, and didnt make it to trigonometry state the following.
$100 borrowed ONCE for a year
$15 paid every two weeks (26 times) for that ONE LOAN (390$ over one year)
100/390=390%APR
That WOULD be 391% APR, however, the theory of a customer only borrowing the $100 only once is ILLEGAL. The state of Ohio doesnt allow “roll-overs”. Roll-overs are defined as letting a customer borrow an amount of money for 2 weeks, and if they cannot pay it back, paying the fee to extend the loan another two weeks. This, in Ohio is ILLEGAL, see Ohio Revised Code 1315.
So the true math is defined as below:
$100 borrowed every two weeks = $2600 Borrowed
$15 paid to borrow every two weeks = $390 paid to borrow $2600.
390/2600 = 15% APR
“Politicians, they are the predatory lenders. Lending inaccurate information on their platform of lies to GAIN VOTES.–
Ted Strickland signed HB 545 because the amendment that was going to take away control of KENO machines (gambling) was omitted giving the goverment the ability to cash in on these “poor victims of predatory lending”s money…well. Lets do the math Strickland. A Drunk, at a bar, spends $100 bucks in your KENO machines, but gets nothing back…whats the APR on that bad boy? Tsk Tsk Sneaky Snake.
Get real. Regulate Oil Prices and market speculation–with the oil price increase, I’m paying more for gas, food, utilities, and any other services i need to survive has FUEL surcharges are added to it.
Predatory defined–I must have heat to survive in the winter, I must eat to survive, and with the increase in these UNREGULATED market speculators driving up the price of oil, I as a single mother of a 2 year old am paying for it…oh but thats not the REAL problem because legislators dont want to affect a real concern -its too hard.
Tara–OHIOAN–Protecting Myself from Governmental Abuse of Power.
1Ohioans should have the choice on how they can borrow money. I hope Ohioans will vote no on this issue and preserve the 6000 jobs at stake.
2