Executive Director provides testimony to state’s Investments and Financial Services Committee
AUSTIN — The Catholic Church’s experience of clients with outstanding payday and auto-title loans has led the Texas bishops to become champions for reform of the unregulated payday and auto-title lending industry.
In testimony before the Texas House’s Investments and Financial Services Committee, the executive director of the bishops’ state conference explained that better consumer protection, consistency and coordination of state laws with federal and local regulations, and data-reporting requirements could contribute to a more just industry.
Many people become mired in a cycle of debt, said Jennifer Carr Allmon, executive director of the Texas Catholic Conference. “Borrowers are repeatedly re-borrowing the same product. This demonstrates that the product is not functioning as a short-term fix, but has become a long-term product.”
Allmon provided six recommendations for legislation:1. Clarify prohibition and enforcement of threats of criminal charges for non-payment.2. Require that disclosures should be provided in the same language in which the loan is marketed and advertised.3. Enact reasonable regulations to adopt the unified city ordinance at the state level, including addressing fees and annual percentage rates.4. Increase funding for OCCC examination of CABs.5. Address the lack of default definition and data.6. Address the inconsistencies between quarterly and annual reports, and improve the transparency of the true cost of loans and numbers of consumers using these products.
Allmon’s testimony in its entirety is available. For more information on the Texas Catholic Conference’s efforts in support of reform for the payday and auto-title lending industry, visitwww.txcatholic-fairlending.org.