Sunday, March 31, 2013

Title loans hurt poor, critics say

Consumer watchdogs sighed with relief after Arizona voters rejected a permanent extension of payday lending in 2008. Payday loans carried triple-digit interest rates that critics said left low-income borrowers trapped in debt, and those high rates were going away.

But the sunset of payday lending only fueled a surge in another form of quick cash for the financially vulnerable: auto-title lending. Like their payday-lending counterparts, auto-title lenders, which use borrowers’ vehicles as collateral, offer short-term loans at triple-digit interest rates, potentially reaching 204 percent.

Read more:  Title loans hurt poor, critics say

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