Letter to the Editor Re: Predatory Lending
To the Editor:
In response to Lisa Kaisers article Predatory Lenders Beware, I wanted to provide an alternative view. Specifically, Id like to address the perspective of Metro Milwaukee consumers living paycheck to paycheck and how a recent legislative proposal (Predatory Lending Consumer Protection Act) would adversely affect their ability to access credit.
Because access to credit has become almost impossible to achieve, Metro Milwaukee consumers may choose short-term loans because they fill a need not being met by other financial institutions. If the Predatory Lending and Consumer Protection Act were to pass into law, as it is currently written, a financial choice utilized by unbanked and underserved Milwaukee citizens would be eliminated.
Prohibiting short-term lending removes a viable and critical credit option and only forces consumers to use more expensive options such as overdraft protection, late fees on credit cards, other bill payments, and off-shore Internet loans. Simply put, a payday advance is sometimes the only financial option for a consumer. Therefore, it cannot and should not be eliminated as an available way to access credit.
As a Milwaukee resident and consumer for over 30 years, this issue is very important to me and many stakeholder groups, who live, work and contribute to the economic market in Milwaukee. As Board Chair of the WCCC, I believe it is imperative to defend fellow Milwaukee residents who are struggling and in need of multiple financial options to make ends meet.
The Wisconsin Coalition for Consumer Choice (WCCC) advocates on behalf of more than 15,000 citizens and community-based organizations throughout Wisconsin. We are committed to defending and protecting Wisconsin consumer choice and the rights of Wisconsin citizens to make their own financial decisions.
Once more, we oppose any effort to restrict choice on products and services available to Milwaukee consumers. Efforts to deny non-traditional credit options through a punitive interest choices is the action, we are likely to witness a significant increase in bounced checks and a possible increase in criminal activity.
The WCCC is disappointed with the Predatory Lending Consumer Protection Act that would take away a viable financial option during these challenging economic times. Hard working, lower-income Milwaukeeans deserve all financial options, not just the ones preferred by select members of our state legislature.
Chairman of the Board, Wisconsin Coalition for Consumer Choice (WCCC)