12/06/2012: State appeals court restricts payday lenders’ interest rates
Payday lenders cannot use Ohio’s mortgage lending law to evade the state’s 28 percent interest rate cap on short-term loans, an appeals court said on December 3 in a case that’s been closely watched throughout the state.
The 2-1 decision by the Ninth District Court of Appeals “makes it crystal clear that these lenders cannot make loans in a way that nullifies the state’s short-term lending act,” said Julie Robie, managing attorney of the Legal Aid Society of Cleveland, which filed a friend-of-the court brief in the case.
Additionally, The Plain Dealer issued an editorial on 12/5, highlighting how “Payday lenders deservedly lose on appeal.”
Also on 12/5, the payday lender Cash America said it would issue refunds to 14,000 Ohio customers it had sued for past-due loans because of “technical errors” in legal documents. The announcement comes on the heels of Monday’s decision by the Ninth District Court of Appeals that Cash America’s Ohio division, which does business here as Cashland, improperly made payday loans under the state’s mortgage lending act. Click here to read this full follow-up story.