Payday And Subprime Lending Bill Continues To Divide
By Erica Irish
INDIANAPOLIS — Lawmakers in the Indiana House avoided all proposed changes to a bill to expand payday and subprime loan products as it was reviewed Thursday.
One day after Rep. Matt Lehman, R-Berne, advanced an amendment in the House Financial Institutions committee to adjust several provisions in Senate Bill 613, he again presented two new amendments when discussing the bill on the House floor.
The first would have prohibited lenders from renewing small or consecutive unsecured installment loans. A second proposal would have allowed lenders to apply pre-paid fees to more types of loan products.
But Rep. Woody Burton, R-Greenwood, who authored legislation that helped to first introduce payday loan products across the state in 2004, opposed both amendments, voting against amendment two and speaking out against amendment three.
“That’s just not something I can live with,” Burton said.
Each of Lehman’s amendments failed, with the chamber voting 40-52 and 39-53 respectively. Many Republicans joined Burton in voting no on each amendment.
House Democrats voiced their opposition the amendments and the existing bill overall as they have since SB 613 was introduced.
Rep. Ryan Hatfield, D-Evansville, blamed the subprime and payday loan options that SB 613 seeks to expand for the 2008 financial crisis, which devastated the national housing market and disrupted individual lives.
“Hoosiers in all of our districts lost their homes, had to file for bankruptcy and were caught in a downward spiral that this bill perpetuates,” Hatfield said when questioning Lehman’s second amendment. “And this amendment speeds that up.”
Overall, Democrats made it clear they want House Republicans to kill SB 613 on behalf of their constituents and the dozens of organizations that have joined forces against the loan expansion.
Rep. Carey Hamilton, D-Indianapolis, offered her solution: to reverse the bill in its entirety and send the issue to a summer study committee.
But when House Republicans called her amendment into question, citing chamber rules, Hamilton quickly withdrew the proposal. However, she said she succeeded in part by forcing those in support of loan expansions to consider her alternative.
“It was only for the purpose of making a point today so that Republican legislators can think about it more over the weekend before we vote on Monday,” Hamilton said. “Frankly, I knew going into it that this would be the case, I’m just disappointed. But it was better than nothing in this frustrating situation.”
SB 613 will face a final vote on Monday.
FOOTNOTE: Erica Irish is a reporter for TheStatehouseFile.com, a news website powered by Franklin College journalism students.