Governor Culver Expected to Sign Auto Loan Bill

Governor Culver is expected to sign a new auto loan bill that would make charging high interest rate auto loans illegal. The new legislation is going to make it tougher for businesses that prey on those with bad credit to get their hands on them. The new law would make it illegal to carry an auto loan with more than 21% interest, significantly down from the 300% that some car loan places are currently offering.

Governor Culver has said that he will sign the law because he feels that the people in the state are being taken advantage of, and supporters couldn’t agree more. They say that restrictions on car loans have been needed for some time now, and that it is high time something happened. Attorney General Tom Miller has been pushing the legislature for years trying to get something done about it and is pleased that something has finally come about.

Under the current system, those with bad credit or no credit would go to one of the high interest car loan places, hand over the car’s title and a set of keys as collateral, and then get charged upwards of 300% on the loan. There is no credit check to see if the borrower can even afford to pay back such a loan, and when a payment is missed, the car is seized and sold and the borrower is left with worse credit than before.

Industry officials say that this will force them from the state, as they won’t be able to afford to continue working with such low interest rates. Supporters of the bill say that they think that is for the best anyway.

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