Target: Representative Debbie Wasserman Schultz
Goal: Do not protect the interests of payday lenders that prey on low-income individuals.
Regulations could soon be loosened on payday lenders that take advantage of low-income people by trapping them in endless cycles of debt. A federal agency called the Consumer Financial Protection Bureau (CFPB) is currently drafting rules that would prevent payday lenders from issuing loans impossible for borrowers to pay back. According to MSNBC, the bill in question would undermine those CFPB regulations by delaying them two years and exempting any states that have laws similar to Florida’s to regulate payday lenders.
While the sponsors of this bill claim that it will protect consumers, the truth is that this bill protects payday lenders. The bill is being co-sponsored by Representative Debbie Wasserman Schultz and seven other representatives from Florida, where a law that claims to regulate payday lenders has actually done very little to protect borrowers. In Florida, borrowers who take out payday loans have to use about 35 percent of their paycheck to make payments — a percentage which is infeasible for low-income people.
Federal regulations of payday loans are necessary because states like Florida that claim to regulate payday loans are protecting lenders, not consumers. According to the Center for Responsive Politics, Rep. Debbie Wasserman Schultz has received a significant amount of money from payday lenders, making her more likely to prioritize their interests than consumer interests.
In order to protect low-income borrowers, the CFPB must be allowed to regulate payday lenders with no interference from Congress. Sign the petition to encourage Rep. Wasserman Schultz to stop supporting this bill and remove her name as a co-sponsor.
Dear Representative Wasserman Schultz,
I am sure you aware of the controversy surrounding the bill you are currently co-sponsoring, which would delay the Consumer Financial Protection Bureau’s payday loan regulations and exempt several states from those regulations. It is clear that you do not have the interests of the borrowers in mind. This bill will do nothing to stop predatory lending.
You and your other Floridian co-sponsors claim that Florida’s law to regulate payday lenders is “among the most progressive and effective in the nation,” but consumer advocacy groups say otherwise. According to Nick Bourke of the Pew Charitable Trusts, payday loans are currently hurting consumers in Florida. On average, borrowers must use 35 percent of their paychecks to make their payments. This is infeasible for low-income individuals, who are most often targeted by payday lenders.
The numbers do not lie; Florida has failed at protecting borrowers. Your congressional bill encouraging states to use Florida’s model will only guarantee that low-income people continue to pay high interest rates and get trapped in endless cycles of debt. I strongly urge you to drop your name as a co-sponsor and discourage your fellow members of Congress from voting for this proposal. Please allow the CFPB to regulate payday loans without interference; they have the best interests of consumers in mind.
[Your Name Here]
Photo credit: Taber Andrew Bain