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About the IS 391% TOO HIGH? VOTE YES ON 5 COMMITTEE!
The IS 391% TOO HIGH? VOTE YES ON 5 COMMITTEE is a statewide group of nonprofit advocates, members of religious and civic organizations, concerned citizens, former payday employees and trapped borrowers who are dedicated to fair and just lending practices in Ohio. Key bipartisan leaders, including Governor Strickland, Senate President Bill Harris and House Speaker Jon Husted, big-city mayors, major newspaper editorial boards, and numerous city councils and county officials support our efforts.
The Issue
WHAT IS ISSUE 5?
Just two days after Governor Strickland signed the country's strongest payday lending reform law to protect Ohio borrowers, the national payday lending lobby launched a well-financed campaign to overturn the law in the November election. The lobby will spend $16 million to maintain their current practices.
The payday lenders are attacking House Bill 545. HB 545 reduces interest rates payday lenders can charge from 391% APR to 28% APR, caps the number of loans that can be taken out per year, and gives borrowers more than two weeks to repay their loan. HB 545 will help end the debt trap for hundreds of thousands of hardworking Ohioans and still allow payday lenders to earn 28% on their money- where can you get that kind of a return?
In July, Ohio Attorney General Nancy Hardin Rogers rejected two of the industry's referendum petitions because they were not 'fair and truthful'. She reluctantly accepted the third petition, which if it passes, will eliminate the repeal of Section 3 -- the original payday lending law. If Section 3 is eliminated and the referendum passes, payday lenders will again be permitted to charge 391% APR.
We fought long and hard in the Ohio legislature for a responsible lending law that puts Ohio in line with 14 other states that cap interest rates or ban the practice altogether, including neighbors Pennsylvania and West Virginia. Now payday lending reform is being threatened by a ballot initiative funded by the national payday lobby group that makes millions off the backs of hardworking Ohioans.
Critical dates and deadlines for HB 545
June 2 - Bipartisan HB 545 singed into law by Governor Strickland
June 4 - $16 million national payday lobby war chest amassed to repeal HB 545
September 1 - The national payday lobby must provide the Secretary of State with 240,365 valid Ohio signatures to place the issue on the November 4 ballot. If the payday industry lobby fails, HB 545 immediately becomes law, reducing interest rates from 391 percent annual interest to 28 percent.
More about a law worth fighting for:
House Bill 545 Repeals the Check-Cashing Lender Law and enacts the Short-Term Lender Law to regulate the making of certain short-term loans. - Caps interest rates at 28% APR, ending the practice of charging exploitative 391% APR interest on payday loans.
- Limits the number of payday loans that can be taken out by a person at 4 per year, helping Ohio consumers escape the debt trap.
- Creates a statewide database of loans made by licensed small-loan lenders, requiring lenders to finally make loans according to the borrower's ability to repay.
- Creates a short-term installment loan linked deposit program to encourage the development of new small-loan products that aren't predatory.
- Establishes a Financial Literacy Education Fund to provide consumers with financial education to help them avoid the debt trap once they've taken out a certain number of loans.
Issue 5 Ballot Language
Should the referendum be on the November ballot, it will be Issue #5. A 'Yes' vote will protect Ohio's consumers from predatory payday lending. You can read the ballot language below:
Issue 5
For more information, check out the Frequently Asked Questions.
Understanding Payday Lending
Download the Ohio AG's "Understanding Payday Lending" Brochure |