Michigan Votes Forum

Introduced in the House on May 26, 2005, to require licensure and impose regulations on providers of a "deferred presentment service" (or "payday loans"), including license fees and bonding requirements. The maximum allowable loan would be $600, and fees (interest) would be capped under a sliding scale of 11 percent to 15 percent depending on the size of the loan. Licensees would have to provide detailed warnings and notices about the loans, and use a real-time state database of all loan transactions to check whether an applicant has an outstanding payday loan elsewhere. The bill limits the duration of such loans, and prohibits "rollovers" and multiple loans

The vote was 99 in favor, 7 opposed and 4 not voting

(House Roll Call 320 at House Journal 61)

Click here to view bill details.

Senators Scott and Clark-Coleman, under their constitutional right of protest (Art. 4, Sec. 18), protested against the passage of House Bill No.4834. Senator Scott moved that the statement she made during the discussion of the bill be printed as her reasons for voting "no." The motion prevailed. Senator Scott's statement, in which Senator Clark-Coleman concurred, is as follows: I do want to thank everyone for their support of my amendment; the ones who voted for it. You know, we've been dealing with this for a long time. We either take care of folks, or we don't take care of them. We don't half-way do things. Either we give them some real relief, or we don't do anything. For four years now, we've been dealing with this. I will not be able to support this because, to me, it just says, OK, you are legitimate now. It's basically loan-sharking and now you have legitimized them to do this. There are some things that you can work on and make some compromises on. As you know, I have been fighting for a long time on these insurance rates. Now we find out that Detroit is the poorest city in this country, and now we say that it is OK to those who are helping them become poor, but I cannot do that. I have to stand by my convictions because some of those people now don't even have a job, so they can't even participate in this illegitimate scheme. This is what we are doing. If New Orleans wasn't something for us to really deal with, then I don't know what there is. You see how those poor people were left behind. There are some more poor people who are just going to be left behind. We have to say that we're going to stand up for people all the way, or we just don't do it. After four years and you are still going to go along. You might as well have supported it four years ago. Well, Mr.Lieutenant Governor, I cannot because I have to stand up for those who in the Bible it says, "the least of these you have done it unto me."

Senator Jacobs' statement is as follows: I rise to support passage of House Bill No.4834. I particularly want to thank my good colleague from the 2nd Senate District in Highland Park for her leadership and advocacy on this issue. We all have things in this bill we feel are not perfect, but this bill is far too long in coming. This bill will for the first time provide sorely needed consumer protections to our constituents who are customers of the payday lending industry. For the first time, we are taking action to make sure that our constituents do not take get caught in a serious cycle of debt and extraordinary interest rates. For the first time, we are capping these rates and assuring that we will no longer hear about our constituents being charged 30 and 40 percent on payday loans. I am very happy that we are finally acting on a bill that members on both sides of the aisle can support. I urge my colleagues to support this bill

Senator Thomas' statement is as follows: Like my colleague, the previous speaker, I also rise in support of House Bill No.4834 not because I'm a fan of the payday advance industry, but because since 1999, we have struggled in Michigan to find a solution to the growing expansion of this industry. Like my colleague from Highland Park, I represent one of those districts where just about on every street corner now there is a payday advance place opening. You can't keep track of how many times these places do open. We've been trying to regulate this industry in Michigan now for six years. This finally gets us on a level playing field where we can regulate this industry and provide true consumer protection. This bill, frankly, is one of the best and toughest bills any state has passed in the nation. We will have the lowest fees of any state in the Great Lakes region, and certainly, the nation. We will have a limited number of advances that a customer can have at one time, which is dramatic improvement from where this legislation was six years ago when it was first introduced. We will have real and full disclosure of all costs, which we've never had, a complaint process for consumers, and very important, an extended payment plan so that when folks do over leverage themselves, there is a realistic opportunity to get out from under this debt. While this legislation is not perfect, it is the best we could get at this time. It is reasonable and prudent consumer protection, and I'm very pleased that the Legislature is taking this action now to regulate this industry. It's simply not going. Away, we have to make sure that all people have fair protections, and this legislation ensures that.

You need to check the facts. If this bill passes, there will be no place for these people to get money. They will turn to true loan sharks and people will get hurt. Would you loan a stranger $200 for 3 weeks for $32 dollars? I think not. I do. Try to find one customer in Pontiac of QuickCash payday advance to say a bad thing about me. bob QuickCash Payday Advance Pontiac, MI

Please check the facts. If this bill passes, these people will truly have no where to go. Would you loan a complete stranger $200 for 3 weeks for $32 dollars? I do every day. Try to find one of my customers to say a bad thing about me...you won't. Regulate this and these people will get hurt. Want to discuss? call me 248-451-9455 bob QuickCash Payday Advance An independent with one store, helping people daily.