Congratulations and our sincere appreciation to two U.S. Senators, who have taken a big step in protecting our military service members from predatory lenders.
Senator Jim Talent (R-MO) and Senator Bill Nelson (D-FLA) were successful in amending Senate Bill 2766 -- the Defense Authorization bill -- to include protections for military families from predatory lending abuses. The bill passed the full Senate late Thursday.
Predatory lenders are targeting young military families, entrapping them in lending schemes that strip them of their hard-earned pay at annual interest rates of 400 percent and higher. One in five active-duty military personnel were payday borrowers last year. Predatory payday lending costs these military families over $80 million in abusive lending fees every year.
The Talent-Nelson Amendment will limit annual interest rates to 36 percent for loans made to military families, allowing our soldiers to keep more of their hard-earned pay.
CRL supports this interest rate limit and other measures that protect military families and all of our citizens from the financial devastation of lending abuses. We applaud Senators Talent and Nelson for their leadership on this critical issue, and we urge the Congress to enact these important protections into law.
The Center for Responsible Lending is a nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices. CRL is affiliated with Self-Help, one of the nation's largest community development lenders.