Monday, January 21, 2008

Economic Stimulus - Crack Down On Predatory Lending!

Last week President Bush held a news conference to discuss his plans for an economic stimulus. Part of that plan includes tax refunds back to us!

My idea for a more long-term economic stimulus is this: outlaw predatory lending in all its forms. We can't just crack down on the "payday lenders" while credit card companies are free to charge exorbitant rates in excess of 25%. Good people get caught in that credit trap and can only afford to make the minimum payment and end up paying off a $2,000 credit card bill in 20 years! That's not right and it really hurts many hard-working families.

There are huge savings when you outlaw predatory lending and North Carolina is a good example. In 1999 North Carolina became the first state to crack down on predatory mortgage lending. It is estimated $100 million was saved in the first year the law was enacted! Also, it is estimated that predatory mortgage loans cost consumers $9.1 billion annually. Imagine the impact to our economy if people were able to spend that money on things they need - that is the economic stimulus we need! But this is only mortgage loans - I can only imagine the savings if we turned the spotlight on credit card companies.

What do you think? Personally, I think it's time we outlaw predatory lending in all its forms.

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