Colorado Shuts Down Payday Predator Easy Pay
Will other states follow suit?
EasyPay Finance, a payday predator that offers short-term loans for car repairs and pet purchases, is no longer allowed to lend in Colorado as a result of a settlement with the state’s Attorney General.
The Attorney General investigated the company based on allegations that it was using a partnership with TAB Bank to circumvent the state’s interest rate cap of 36% on loans.
Here’s how the AG’s office described their findings:
An investigation by the Consumer Credit Enforcement Unit of the Consumer Protection Division in the Colorado Department of Law found that EasyPay charged interest ranging from 29% to 199% on small-dollar loans ranging from $350 to near $5,000. The investigation found that 78% of its loans were at rates over 100% and over one-third were over 168% APR. Of the consumers who did not qualify for an interest rebate promotion through 2019, 36% of the loans defaulted.’
In addition to ceasing operation in Colorado, EasyPay will pay $275,000 to consumers harmed by its predatory practices.
Here’s how one consumer advocate describes EasyPay as it relates to the company’s car repair lending operation:
“A car repair can be a devastating expense, and financially fragile families don’t need predatory lenders amplifying the damage. EasyPay and its rent-a-bank partner TAB Bank are preying on people in a way that exploits the centrality of cars in American society. For most people, having a car that runs well is essential to their daily economic life and to managing a family,” said Elyse Hicks, Consumer Policy Counsel at Americans for Financial Reform.
Did I mention they also offer puppy loans?
Here’s more on that:
“The FDIC must break up the romance between TAB Bank and EasyPay Finance,” said Lauren Saunders, associate director of the National Consumer Law Center. “TAB Bank and EasyPay’s rent-a-bank relationship enables 189% puppy loans of questionable legality — well in excess of many state interest rate caps — dramatically increasing the cost of a family pet.”
On Capping Credit Card Late Fees
Credit card late fees are annoying but often viewed as a necessary element of having a credit card.
Miss the payment by a day — or even a few hours — and you could be hit with fees up to $41.
The Consumer Financial Protection Bureau (CFPB) says that’s excessive.
The regulator is seeking to cap credit card late fees at a rate that allows banks and credit card companies to recoup their actual cost but doesn’t overly tax delinquent consumers.
That rate? $8.
That’s it.
Your new maximum late fee for a credit card payment could be capped at $8.