The Wisconsin Senate passed a new bill in the 11th hour. Here are the details.
The new law would restrict where payday loan stores could locate and limit their loans to $1,500 or 35% of monthly income, whichever is less. Borrowers would be able to renew those loans just once. Auto title loans would be limited to half the value of a vehicle.
Title lenders would be required to notify borrowers before seizing their vehicles; could charge borrowers only “reasonable” storage fees if they repossessed their vehicles; and give borrowers cash back if they sold their vehicles for more than the amount of the loan.
The bill does not include a state database, like Veritec. This is a good thing.
Two things I’m curious about:
- Only one rollover is permitted, but can the borrower pay off in full and reborrow? I did not see a cool off period.
- Regarding title loans, how is the value of the car determined?
Comments
4 responses to “Wisconsin has a new payday law”
Actually, the bill now requires a database and there is a 24-hour cooling off period after any renewal. The bill also mandates an extended payment plan be offered on all past due advances at no extra cost.
Thank you Mick. You are correct. There will be a database and I was not aware of the cooling off period.
One additional note, my source says that the payment plan is available once a year.
Has anything changed on the installment loans for small loan companys.
After the first renewall can you convert them to a installment loan?
Jim, this post is very helpful for Wisconsin: https://www.pdlindustry.com/new-wisconsin-law-matrix/.
To my knowledge, installment loans were not touched. Now, they’re putting some rules out, so that could change.