Local News

Jun 18, 2014 6:38 PM by Andrew Ellison - aellison@kristv.com

City and State Officials Have Their Eyes on Payday Loans

CORPUS CHRISTI - City officials, along with State lawmakers, are trying to crack down on payday and auto-title loans.

The Catholic Charities of Corpus Christi held a workshop today, where community leaders laid out a plan to address these loans, and the people who fall victim to the high interest rates.

Bishop Michael Mulvey says these loans are dangerous for the people who take them out.

"They're getting caught in a trap, and we think that this is unjust," he says.

Payday loans are usually taken out by those who need cash quick, and are trying to make ends meet.

In the case of an auto-title loan, the payday lender holds your car title until you pay the loan back. If you don't, you can lose your car.

But as Mulvey will tell you, these loans come with high interest rates, and the mountain of debt adds up fast.

Mulvey says that Catholic Charities often helps those in need pay their bills, but their finding a similar trend.

"You find out the same people are with a payday loan, and where's this money that we're helping them with for electricity? It's going to pay the debts," Mulvey says.

The city is considering ordinances and State legislators are considering laws to put a cap on these interest rates, and demand more transparency from payday lenders.

"You also don't want what we call the hidden fees, where somebody go takes a loan out and all the sudden you find out the fees are higher than the interest rate itself," State Rep. Todd Hunter says.

Hunter says getting an early start on the issue will increase the chance that something gets passed when the legislature meets in January.

"I think if interest is shown, you have a good chance on these sort of issues," he says.

Today's seminar was just the beginning.

There will be another tomorrow morning from 10 am to 11:30 am.

The sessions will be held at the Catholic Charities of Corpus Christi at 1322 Comanche Street.

If you would like to R.S.V.P., and find out more about payday loans, call Catholic Charities at 361-884-0651.


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