Wisconsin GOP Proposes Repeal of Payday Loan Limits

By: Javi Calderon
Wisconsin GOP Proposes Repeal of Payday Loan Limits

Just last year a Democrat-led Finance committee passed limits for payday loans and lenders in the state of Wisconsin. Loans were officially restricted to either $1,500 or 35% of the customer’s monthly income. Former Governor Jim Doyle took the measure even further by using his power of veto to officially banning car title loans. The measure has officially been in place since January.

As of May 11th, however, a Republican-led legislature has taken significant strides towards revoking those restrictions. The Joint Finance Committee voted 11-5, overwhelmingly in favor of the proposal to roll back last years decision.

While critics fear the motion will welcome a rampant and unregulated payday advance landscape, Representative Robin Vos (the committee co-chairman who brought the motion to the table) believes the repeal will bring back the original proposal before Doyle changed it with his vetoes.

Vos believes the original bill contained better provisions and Doyle misconstrued the bill’s intentions with his vetoes.

Doyle included the restrictions on auto title loans because he does not see the merit of a financial product that takes away the ability for a person who struggles financially to get to work. Understandably, if a person is already unable to pay their tab, taking their car will only make their situation more dire.

One of the main goals for the Committee is to allow lenders to charge up to 33% a year on loans that are past due.

In order for the repeal to take affect, the entire Wisconsin State Legislature and Republican Governor Scott Walker (who has taken over for Doyle since last year’s decision) will need to be on board.

Before the bill was passed last year with Governor Doyle’s changes, Wisconsin was the only state in the U.S. with no form of payday loan regulation.