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Full-Text Articles in Consumer Protection Law
Regulation Of Payday Loans: Misguided?, Paige Marta Skiba
Regulation Of Payday Loans: Misguided?, Paige Marta Skiba
Paige Marta Skiba
Since payday lenders came on the scene in 1990s, regulation of their "predatory" practices has been swift and often severe. Fourteen states now ban payday loans outright. From an economist's perspective, high-interest, short-term, small loans need not be a bad thing. Payday credit can help borrowers "smooth" consumption, unequivocally improving welfare as consumers borrow from future good times to help cover current shortfalls. These benefits of credit can accrue even at typical payday loan interest rates of 300%-600% APR. The question of whether payday credit actually assists borrowers in this way is an empirical one. In this Article, I review …
Consumer Litigation Funding: Just Another Form Of Payday Lending?, Paige Marta Skiba, Jean Xiao
Consumer Litigation Funding: Just Another Form Of Payday Lending?, Paige Marta Skiba, Jean Xiao
Paige Marta Skiba
This article provides a side-by-side comparison of payday lending and consumer litigation funding in order to aid policymakers. Funding has similarities with payday lending because they are both alternative financial services, involve high interest rates, and cater to customers who need money for living expenses. However, they differ in ways that regulators should recognize. Many justify bans on payday lending by pointing to the fact that millions of borrowers every year are getting stuck in an inescapable cycle of interest payments. While legal finance has real costs, funding’s nonrecourse nature prevents consumers from getting stuck in a cyclical repayment of …
American Usury Law And The Military Lending Act, Paul Kantwill, Christopher L. Peterson
American Usury Law And The Military Lending Act, Paul Kantwill, Christopher L. Peterson
Utah Law Faculty Scholarship
In 2006 Congress adopted the Military Lending Act (“MLA”) to protect active duty military service members and their families from high-cost, predatory loans. The core provision of the statute is a usury limit capping interest rates at no more than 36 percent per annum. The United States Department of Defense finalized regulations implementing the MLA in 2007 and then later issued substantially revised regulations in 2015. The MLA is America’s first modern, national usury law that is applicable to all types of creditors and was adopted after the evolution of our national credit card market. After over a decade, the …