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91_HR0164
LRB9106402LDmb
1 HOUSE RESOLUTION
2 WHEREAS, The granting of credit is a matter that is of
3 economic importance to the citizens of this State and of
4 concern to the House of Representatives; and
5 WHEREAS, It has come to the attention of the members of
6 this Body that certain lenders are charging fees and interest
7 on short-term loans that result in annual percentage rates in
8 excess of 300%; and
9 WHEREAS, The imposition of exceedingly high interest
10 rates creates financial burdens on persons who must borrow
11 on a short-term basis; and
12 WHEREAS, Borrowers who take out short-term loans may
13 constitute a captive market for lenders who charge high rates
14 of interest; and
15 WHEREAS, These short-term loans, commonly called "payday
16 loans", typically require the borrower to give the lender, at
17 the time of the loan, a postdated check in an amount
18 sufficient to pay the loan; and
19 WHEREAS, Additional information about the practices of
20 lenders who make payday loans is necessary to enable the
21 House of Representatives to determine if additional
22 regulation of this business is necessary; therefore, be it
23 RESOLVED, BY THE HOUSE OF REPRESENTATIVES OF THE
24 NINETY-FIRST GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, that
25 there is created the Payday Loan Review Commission consisting
26 of 4 members appointed by the Speaker of the House and 3
27 members appointed by the Minority Leader of the House, all of
28 whom shall serve without compensation but shall be reimbursed
29 for their reasonable and necessary expenses from funds
30 available for that purpose; and be it further
-2- LRB9106402LDmb
1 RESOLVED, That the Commission is directed to conduct a
2 study of the business of making payday loans; and be it
3 further
4 RESOLVED, That the study include a determination of the
5 number and locations of entities engaged in the payday loan
6 business, information on the annual percentage rate of
7 interest and other charges imposed upon borrowers who receive
8 payday loans, and a profile of the borrowers who take out
9 payday loans; and be it further
10 RESOLVED, That the study determine whether persons who
11 take out payday loans constitute a captive market for
12 lenders, whether the rates and fees charged are excessive,
13 and whether the lenders engage in "sharp" loan practices; and
14 be it further
15 RESOLVED, That the study include a discussion of problems
16 payday loan practices cause for borrowers and consumers in
17 general; and be it further
18 RESOLVED, That the Commission report its findings and
19 recommendations to the House of Representatives by September
20 15, 1999; and be it further
21 RESOLVED, That a copy of this resolution be delivered to
22 the Speaker and Minority Leader of the House of
23 Representatives.