Houston is becoming quite the predatory lender’s hunting grounds and even though the city is seeking ways to prevent this practice from becoming a full blown epidemic, it’s going to be a rough jog, up a very steep embankment.
Houston City Council has for some time now, paid attention to the pitfalls involved in payday loans that are easy to get, but efforts to repay the loan, in most cases, defeats the purpose. As such, the collateral used to secure the loans eventually end up in the hands of the lenders.
Houston’s Housing, Sustainable Growth and Development Committee, which Council member Wanda Adams chairs, considers this fast growing business as a huge problem and a such are looking for ways to curtail the multi billion industry’s influence in the city.
"Over 70 percent of single-payment auto title loan consumers, they refinance their loans. And actually it's far above the state average. The state average is 57 percent, we're over 70 percent here in Houston," Adams stated.
But now, as this is truly a worthy and noble cause to take up, really and truly, it does the city no good to attack these lenders without the state’s legislative body taking the lead. The Texas 2011 Legislative session did try and address this issue, but money talked a lot louder and those pieces of legislation walked completely out of the picture and as such, the 83rd session hasn’t even mentioned predatory lending.
‘Dallas, Austin, San Antonio and El Paso have adopted regulations. Dallas and Austin have been sued over their restrictions.' This is cause for Houston to walk gently and as such, the city is waiting to see if ‘the Legislature acts during its current session before voting on their proposal.’
Last week, the city sought feed back from the public on their regulation proposals and that’s good, but only to a certain point. You’re either going to lead, or you’re going to follow and if following is the predetermined course of action to take, why waste time, energy and resources that serves absolutely no purpose?
Mayor Annise Parker has said the industry "cries out for regulation" and called the state's failure to do so "disgraceful."
Coming out of the dark on predatory lending, finally seeing the light and putting on sun glasses, is not helping.
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