City of Caldwell Adopts Ordinance Limiting Predatory Lenders!!!

Thank you Caldwell City Council and Mayor Nancolas!

On Monday December 16, the Caldwell City Council voted unanimously in favor of an ordinance that will limit new payday and title loan businesses in the city. New predatory loan companies wishing to set up shop in Caldwell’s commercial areas will be required to apply for a special use permit and receive approval from the City Council. The Mayor and City Council members have shown great leadership in protecting their citizens as Caldwell is the first city in Idaho to address this growing issue.

ICAN members have been active over the last several months reaching out to churches, community groups, small businesses and residents who have struggled with predatory loan debt. Continue reading

ICAN Supports Fair Lending! Payday Lending Hurts Idaho’s Families

2013-10-04 10.05.04
“With the average payday loan in Idaho carrying an interest rate of 350% and with the average borrower taking out 7 payday loans to pay off the initial loan”, predatory loan businesses continue to swarm into our state. Last year alone, payday loans accounted for a negative economic impact of one billion dollars and are attributed to the loss of 14,000 jobs!  This is money that our communities lost, nationwide.

Volunteers and members of Idaho Community Action Network went into the neighborhoods of Caldwell and gathered 400 signatures from families who both see and personally experience the impact of payday and title loan businesses. The canvassers met families; families who have lost their only vehicle; families who lost their home; their job and even their children, because they needed help. They learned about loved ones who died owing a debt to a predatory lender.

Together these families are asking for a simple zoning ordinance to limit the location of any new payday or title loan center. To make them less visible and less accessible, the plan is re-direct any new businesses out of poor neighborhoods and other populated areas and place them in industrial zones.

Caldwell has an unemployment rate higher than the state and national averages and with a population of just over 45,000 people. Yet there are close to 20 payday loan centers listed in and around the city. ICAN circulated the petition and continues to address the ongoing problem of  payday  and title loan companies  unlimited interest rates. Idaho falls prey to these predators as surrounding states chase these loan sharks away with interest rate caps and strong regulation. ICAN members support a rate cap at 36% following federal limits for active military.

The Caldwell City Council members heard testimony Monday night from residents trapped by predatory loans offered by payday and title loan companies. Residents are looking for a zoning change that would, “would restrict payday and title loan centers, potentially keeping new centers from opening up in the center of town.” (Northwest Cable News, 10,7,13)
Payday loans are small-dollar, short-term, unsecured loans that borrowers promise to repay out of their next paycheck or regular income payment. Payday loans are usually priced at a fixed-dollar fee, which represents the finance charge to the borrower. These interest rates exceed a predatory rate cap of 36% APR.

What happens as a result of taking a predatory loan is a debt cycle that traps a borrower, with no easy way out. Most lenders do not accept partial payments on the debt, so if the amount borrowed cannot be paid off in its entirety, then borrowers are encouraged to renew their loan. By making interest only payments, borrowers roll the loan over until their next payday. Once the borrower reaches the end of the loan extension, he or she is again presented with the option of renewing it again. Idaho regulation does require the loan to be paid off after three extensions, however, a new loan can be immediately offered, creating a great challenge in ever paying off the loan.

The effort to restrict where predatory centers can operate at the city level is just the first step in the ongoing fight to limit payday loans in Idaho. The real solution is to outlaw these defective products by enacting a statewide rate cap at 36%. Eighteen states have enacted rate caps of 36% or less.

For more information on the fight for fair lending in Idaho check out our report here.  To join us in our efforts, please call our office at 208-385-9146.

US Bank: They’re Doing The Hokey Pokey And Stripping All Our Wealth!

ICAN member Krista Ziebarth wearing the message!

ICAN member Krista Ziebarth wearing the message!

There are questions we ask of ourselves after every direct action we stage against powerful institutions. Institutions that seem to operate with impunity and hurt working families, often keeping families locked in debilitating cycles of poverty. Yesterday’s actions against US Bank raised the same questions: did we make a difference? Are they going to listen?

Community voices from Minnesota, Oregon and Idaho spoke to the press about the ongoing predatory and unfair practices of US Bank. And with proxies in hand others in our coalition addressed US Bank’s annual shareholders meeting. The meeting last year was in Minnesota, but after other community voices holding proxies to the meeting held the bank’s CEO Richard Davis to task for over an hour, the bank changed the location. Perhaps they thought they could meet in peace, but that was not the case. Our actions yesterday began early in the morning. Continue reading