They’ve got some interesting legislation under consideration in New Hampshire which would cap interest on payday and title loans at an annual rate of 36 percent. That’s an interest rate that is comparable to some major credit cards for people with marginal credit. Surely the payday loan industry is quaking in their boots at the very idea because such a rate cut would cause them to easily lose half of their profit margin or more. A welcomed prospect for the lender, however, who could borrow with the security of not being taken to the cleaners by a usurious lender. According to the article, this is what that means in real numbers

Were the interest rates they could charge capped at 36 percent, payday lenders have said they could charge just $1.38 per $100 borrowed. Payday lenders in New Hampshire typically charge about $20 per $100 borrowed.

With that, payday loan companies in New Hampshire are already considering that they may have to follow the lead of Advance America in Oregon who recently had to close over forty of it’s payday loan stores because of legislation similar to that proposed in New Hampshire. Check out the full article at UnionLeader.com.

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