At Thursday night’s city council meeting, the council will discuss a proposed ordinance on tighter regulations of payday and auto title lenders.
The group spearheading the discussion is the West Texas Organizing Strategy (WTOS), who say they want to better protect people in Lubbock against predatory lending, since those who find themselves needing to use these loans are typically already in a vulnerable place.
“People who take payday loans are people often in crisis, and crises affect all of us, none of us are immune. The elderly, teachers, students and young couples, and so it’s not just one segment of our population,” said Carol Schempp, president of the Llano Estacado Alliance for Democracy, a sister organization with WTOS.
“Refinancing causes sometimes the effective interest to reach as much as 600%, and people are unable to pay back those loans and they get sucked down into what’s called debt trap.”
The group reports that in 2015, 25 payday and auto lenders in Lubbock alone made more than $40 million in loans, fees and refinances with 569 car repossessions.
“This hurts everybody and so that’s why we’re trying to see if this will pass,” said Ruby Gonzales, WTOS leader. “We want the support from the council. We hope that they will feel as we do that the people of Lubbock are more important than the dollars that pay day lenders and auto title lenders are making.”
Councilman Juan Chadis placed the item on the agenda. The group says that they’ve been working closely with him and that he will be supporting the passing of the ordinance on Thursday night.
