- Associated Press - Sunday, October 11, 2015

SALT LAKE CITY (AP) - A state report has found that thousands of Utah residents were unable to pay off payday loans last year, further fueling criticism that such loans are debt traps.

The Salt Lake Tribune reported (https://bit.ly/1VMcsCQ) Sunday that the state Department of Financial Institutions released data this month showing more than 45,000 customers failed to repay the loans in the allotted 10-week period.

The department says the outstanding loans amount to nearly $18 million.

The state required payday lenders to report outstanding loans after former Attorney General John Swallow was accused in a scheme involving lenders.

Republican Rep. Brad Rep. Brad Daw has been outspoken in his criticism of payday loans. He said the current data is “pretty bad” and “belies the industry’s claims” that these types of loans don’t turn into a “debt trap.”

He said the newly available data suggest default rates are as high as a third of all payday loans.

“I think we ought to know how many people are getting payday loans,” Daw said. “Not knowing the default rate is really weird.”

Utah Consumer Lending Association spokeswoman Wendy Gibson said, “The vast majority of customers can afford to repay their loan within the arranged time frame.”

Daw wants legislation limiting how many loans a borrower can take out.

___

Information from: The Salt Lake Tribune, https://www.sltrib.com

Copyright © 2019 The Washington Times, LLC.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.

 

Click to Read More and View Comments

Click to Hide