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Congress is trying to strip away Americans’ protections from predatory lending

Last month, Governor Fallin made the right choice when she vetoed HB 1913 – a bill that would have expanded predatory lending in Oklahoma. In her veto message, Fallin pointed out that Oklahomans frequently take out high-interest loans at a high cost to them and their families. Gov. Fallin wisely chose not to add another predatory product to the market that could trap Oklahoma families in even more debt.

Predatory lending is not just an Oklahoma problem. Only 15 states and the District of Columbia prohibit payday lending with interest rate caps.  Interest rates in the remaining states range from an average of 154 percent in Oregon to an astronomical 677 percent in Ohio. The average rate in Oklahoma on a payday loan is nearly 400 percent. Payday borrowers often end up paying more in interest than what they get through the loan, and repeat borrowing is common.  Payday loans, auto title loans, and small installment loans are a debt trap for working families in America, and most states have not taken action to protect them.

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Common sense reforms needed to protect Oklahoma tenants

by | May 9th, 2017 | Posted in Consumer Protection | Comments (1)

Preston Brasch was an OK Policy Spring intern. He is studying law at the University of Tulsa School of Law.

Oklahoma faces a significant affordable housing shortage (see e.g. the 2016 Oklahoma Housing Needs Assessment and A Housing Strategy for Tulsa). Wait lists for programs that provide affordable housing can last anywhere from several months to several years. So what do these low-income families do? They often end up in unsafe and poorly maintained housing — an astounding 75 percent of low-income tenants in Oklahoma live in properties with at least one “housing problem” as defined by the U.S. Department of Housing and Urban Development.

This matters because evidence shows poor housing conditions have tremendous impact on health.  Children are especially vulnerable: one study found that 39 percent of asthma cases in children under six were linked to their homes. In the most extreme cases, tenants experience sewage backing into the home, leaking roofs, and infestations that can cause infectious disease.

It is important to note that most cases are not so extreme, and most landlords try to provide safe homes to their tenants. However, some landlords abuse the flaws in Oklahoma laws to profit off of our state’s most vulnerable citizens. Due to some unintended consequences of Oklahoma laws, local communities face an uphill battle in trying to improve housing that endangers the health of tenants. Fortunately, a few simple fixes could shore up these problems.

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