States without Payday and Car‐title Lending Save Over $5 Billion in Fees Annually

By Sara Nelson-Pallmeyer February 8, 2017

According to a report published in  2016 and updated in January 2017 by the Center for Responsible Lending (CRL), Minnesota alone saves $81,240,630 annually because car title loans are not legal in Minnesota.
Their report indicates that we could save even more than that amount if payday loans were not allowed either. CRL estimates that states without payday and car title have saved over $5 billion a year in fees annually – $2.2 billion from payday lending, plus another $2.8 from car title lending.  Many of the top fee savers are states that strictly enforce their consumer lending usury rates, not allowing lenders to exploit loopholes in their state law.

This has been effective in providing savings from payday and/or car title lending in those states.    Research has shown that regulating debt trap lending has not resulted in a restriction of access to credit on a state level.  In fact, the same research found that the majority of former payday borrowers in North Carolina saw a positive impact on their household after payday was banned in 2006. Read more