Fast review in committee of Colorado House Bill 11-1290
Friday, Colorado House Bill 11-1290 was introduced. The Colorado Statesman explained that it might be debated soon. The installment loans origination fee of $20 per $100 loaned for the first $300 and $15 per $100 loaned for the next $200 up to a maximum of $500 loaned nets loan companies up to $75. A finance charge of 45 percent is allowed also in accordance with Colorado law. Another $7.50 maintenance fee per $100 lent per month is also allowed.
As two-week pay day loans can no longer be offered in Colorado, loan providers argue that being able to charge a full origination fee as HB 11-1290 stipulates is necessary for survival.
HB 10-1351 and HB 11-1290 sponsors argue
The legislation has 10 co-sponsors in the House, including Rep. Sue Schafer, D-Wheat Ridge, who voted “no” on HB 10-1351, also as Rep. Ed Casso, D-Commerce City, who favored HB 10-1351. U.S. Senate sponsors consist of other anti-HB-1351 legislators for instance Sen. Mary Hodge, D-Brighton, and Sen. Lois Tochtrop, D-Adams County.
Technical correction or incentive to re-borrow?
Supporters of Colorado House Bill 11-1290 maintain the origination fee change is merely a technical correction to the provisions of last year's HB 10-1351. Bell Policy Center’s Rich Jones doesn't agree. He says:
“It's an incentive for the lenders to get customers to pay off their loans early and then take out more loans,” Jones told the Statesman Friday.
Information from
DORA
dora.state.co.us/Financial-Services/pdf_forms/Revised HB10-1351_2.pdf
State Bill Info
statebillinfo.com/bills/bills/11/1290_01.pdf
Colorado Statesman
coloradostatesman.com/content/992687-payday-lender-bill-being-fast-tracked-through-house
'Steering Colorado's economy back on course'
youtube.com/watch?v=3mHOl-S6F1s
