Congress Moves to Protect Georgia’s Predatory Car-Title Lenders

Resolution Filed to Block Consumer Bureau’s Ability-to-Pay Rule

ATLANTA – On Friday, December 1, a resolution was filed in the U.S. House of Representatives that would block new consumer protections adopted by the Consumer Financial Protection Bureau that would rein in predatory 300% annual percentage rate (APR) loans.

“Georgians pay millions of dollars in fees to predatory lenders whose business model results in consumers being trapped in a cycle of debt. It is outrageous that Representative Tom Graves (R-GA-14) and his colleagues would attempt to undo a rule requiring that lenders consider borrowers’ ability to repay their loans,” said Liz Coyle, executive director of Georgia WatchResearch by the Center for Responsible Lending shows that auto-title loans drain nearly $200 million a year from families in Georgia.

In addition to Representative Graves, the resolution was filed by Rep. Dennis Ross (R-Fla.) and lists Rep. Alcee Hastings (D-Fla.), Henry Cuellar (D-Texas), Steve Stivers (R-Ohio) and Collin Peterson (D-Minn.) as cosponsors.

“Americans of all political persuasions should be outraged at the members of Congress who are trying to block modest protections for predatory 300% loans that put families into a debt trap,” said Lauren Saunders, associate director of the National Consumer Law Center. “Ordinary people, whether Republican or Democrat, liberal or conservative, support reform of 300% loans that prey on working families living paycheck to paycheck. The consumer watchdog’s rule adopts common-sense protections that responsible lenders already follow by considering the borrower’s ability to repay the loan. Congress should not side with predatory lenders over Americans.”

The public overwhelmingly supports reform of the payday and car-title loan industry. 73% of Americans support requiring lenders to check a borrower’s ability to pay before lending money and over 70% of both Democrats and Republicans support the Consumer Bureau rule. In November 2016, 76% of South Dakota voters voted to adopt a 36% interest rate cap in that state, a higher percentage of the vote than President Trump received. Montana voters did the same in 2010, another conservative election year.

The Consumer Bureau’s rule primarily applies to loans of 45 days or less. The rule requires lenders to consider the borrower’s income, major debts, and living expenses and make a reasonable determination that the borrower can afford to repay the loan. Lenders are also allowed to make up to six loans a year without considering the ability to repay. The rule has exemptions for many credit union and community bank loans.

The resolution was filed under the Congressional Review Act, which allows Congress to block rules on a fast track schedule without the possibility of a filibuster. If the resolution passes, it would block the Consumer Bureau from ever adopting substantially similar rules in the future without congressional approval.

Read the CFPB press release and factsheet summarizing the rule on payday and car-title loans and the full CFPB rule.

Learn more about NCLC’s body of work on high-cost short-term loans.


Founded in 2002, Georgia Watch is the State’s leading consumer advocacy organization. As a 501(c)(3) non-profit, non-partisan organization, we work to ensure that Georgians are educated and protected on matters that impact their wallets and quality of life. We focus on ensuring access to quality, affordable healthcare, fair utility rates, renewable energy options, safeguarding personal finances, and access to the courts. Through advocacy, outreach, and education, we work tirelessly to make Georgia a model for consumer protection.

Since 1969, the nonprofit National Consumer Law Center® (NCLC®) has used its expertise in consumer law and energy policy to work for consumer justice and economic security for low-income and other disadvantaged people, including older adults, in the United States. NCLC’s expertise includes policy analysis and advocacy; consumer law and energy publications; litigation; expert witness services, and training and advice for advocates. NCLC works with nonprofit and legal services organizations, private attorneys, policymakers, and federal and state government and courts across the nation to stop exploitative practices, help financially stressed families build and retain wealth, and advance economic fairness.