Bill would put tight limits on payday lenders

MADISON — Auto title loans would be banned, payday loans would be limited to $600 and lenders could not roll over a borrower’s debt into a new, larger loan under an Assembly bill unveiled Tuesday.

Democrats who control the chamber described the plan as a compromise that will outlaw the payday lending industry’s most abusive practices while preserving a source of credit for the most desperate borrowers.

Payday loans are short-term loans with extremely high interest rates that amount to advances on a borrower’s next paycheck. Supporters say they are often the only source of credit available for many low-income people who need quick cash to pay for unexpected expenses.

At a testy Capitol news conference, Democratic lawmakers acknowledged that Assembly Speaker Mike Sheridan’s recent admission of a romantic relationship with an industry lobbyist was a distraction.

But they insisted Sheridan had not been involved in details of the legislation and lashed out at the news media for focusing on his personal life. If anything, Rep. Josh Zepnick said, the attention resulted in a stronger bill after months of infighting among Democrats.

“In spite of all the news and the things you’ve been hearing, we busted our butts on this bill,” said Rep. Jason Fields, D-Milwaukee.

Tags: news, wisconsin, legislature, money, lending, debt