Petition drive takes aim at payday lenders

new tonight a six a petition drive underway right now to try and lower the maximum interest rate that payday lenders can charge initiative 126 would cap that fee of 36 percent that’s down from the current 45% allowed under Colorado state law news hi Sandy Cohen here breaking down the numbers for us and what this petition wants to change and how the payday loan industry is responding to this Robin Elizabeth it’s not the interest but really the fees that make payday loans so expensive now according to the attorney general’s office the average amount of interest paid on a $400 loan was about $30.00 but by the time you add in origination fees and maintenance fees you end up costing you more than a hundred dollars to finance that loan that’s the same as paying a hundred and seventeen percent interest rate now this petition not only lowers that interest rate but it also eliminates the fees drive away with cash today payday lenders promise borrowers quick and easy money but that convenience comes at a cost right now a payday lenders are exempted from the state usury rate and are able to charge triple digit interest because of that exemption which is why she’s leading a petition drive to cap payday loan rates at 36 percent under current law the maximum rate is 45 percent we need more consumers and Coloradans to even understand what a payday loan is to understand that it is triple digit interest and how unfair that is to be able to vote on it in November but she’s got some competition from the very industry she’s hoping to reform two other petitions were approved by the Secretary of State and they were authored by a payday lender and affirmed that lobbies for the industry the big difference origination and monthly maintenance fees Corinne’s petition eliminates them but the others do not the initiatives basically keep the status quo for the current triple digit interest so we want to encourage voters to read their ballots carefully as always and to make sure that they vote to cap the interest rate at 36 and I didn’t speak with Bill Fritz he’s the payday lender who was launching those two competing petition drives he declined to comment for this story but both Fritz and Fowler they have until August the six to collect roughly ninety eight thousand signatures that are needed to make it on to the November ballot watching out for you Andy Cohen news 5 need to follow up on that Andy

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