ABILENE, Texas (KTAB/KRBC) - A public hearing date has been set for an ordinance that would regulate payday and auto title loans in the City of Abilene.
Community members with concerns or comments about the proposed ordinance are invited to attend the public hearing that will take place during the Abilene City Council meeting on Thursday, April 27th at 9:00 a.m.
The proposed ordinance will also be discussed during a special called meeting with a public comment section that will be held at the Abilene City Council chambers downtown on Tuesday, April 25th at 5:30 p.m.
A public hearing will also take place on this proposed ordinance during the Abilene City Council meeting on
If passed, the proposed ordinance would instate the following restrictions and limitations on payday/auto title lending services in Abilene:
- Requires registration of all Credit Access Businesses within the City limits.
- Requires the businesses maintain complete records of all loans for three years and to make the records available to the City upon request.
- Limits the loan to no more than 20% of a consumer's gross monthly income and title loans on vehicles to no more than 3% of the consumers gross annual income or 70% of the retail value of the vehicle.
- Provides that repayment in installments may not be in more than 4 installments.
- Prevents renewals or refinancing of installment-payment loans.
- Requires that any agreement be written in the consumer’s language of preference, including English and Spanish.
- Referral to credit counseling is required.
- State mandated quarterly reports and any other requested information must be submitted to the City.
The ordinance was first debuted during a city council meeting Thursday morning. Several citizens attended the meeting to discuss this issue, so city council members opened the floor for public comment, something that normally doesn't take place during the first reading of an ordinance.
Citizens and business owners voiced concerns to city council members during the comment, speaking out both for and against the proposed payday loan restrictions.
Those in opposition of the restrictions argued that some people do no qualify for or cannot get loans otherwise, and others argued that implementing the restrictions would cause several payday/auto title loan businesses to close, resulting in significant job loss.
Those in support of the restrictions argue that these payday/auto title loans start a vicious cycle that causes consumers to pay hundreds, if not thousands, of dollars in addition to the initial cost of the loan due to high interest rates and the loans' rollover policy.
These additional payments, according to those in support of the restrictions, cause financial turmoil for many individuals and families that turn to payday/auto title loans in times of need.
City Council members will make a final decision on this payday loan/auto title loan ordinance during their weekly meeting on Thursday, April 27th. A public hearing will take place prior to the decision.
There are currently no State or Federal regulations on payday/auto title loans. The ordinance the City of Abilene is considering was provided by the Texas Municipal League and has already been adopted by over 40 other Texas cities, including San Angelo, Midland, Waco, Killeen, and Denton.
BigCountryHomepage will continue to follow this ordinance as it makes it way through the City Council process. Check back for additional information as it becomes available.
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