The YWCA is proud to be a part of The Alliance for Responsible Lending in Alabama (ARLA) that is hosting a free predatory lending town hall meeting will be November 19 from 6:30 – 8:00 p.m. at Faith Chapel Christian Center (800 Quebec Drive, Birmingham, AL 35224 / (205) 785-9673). All are welcome to attend and help better educate our community on these exorbitant interest rates.
Too often, the YWCA sees the heart-wrenching impact of predatory lenders on the families we serve. In many Birmingham neighborhoods, too many people get caught in the devastating cycle of borrowing more and more to pay back their original loan. Because the YWCA believes that our laws need to protect families from high interest rates, we have partnered several community organizations to advocate for legislative change that will protect the families we serve.
“For many of us our religion informs our views of predatory lending. Christianity, Judaism and Islam all condemn the practice of usury, which is the practice of charging excessive interest on loans. This event will explore how religious viewpoints conflict with current practices in our state, and it will offer ideas on how to make our state’s laws more in line with many Alabamians’ moral, ethical and religious beliefs,” says Joan Witherspoon-Norris, Director of Social Justice.
Under current Alabama law, payday and title pawn lenders are allowed to charge 456 percent APR on payday loans and 300 APR on automobile title loans. There are no ethical or moral reasons for such excessive rates. With such high interest rates, people who use these services, who already struggle to afford basic living expenses, are often trapped in a cycle of debt. In fact, according to the report “Easy Money, Impossible Debt,” from the Southern Poverty Law Center, “Borrowers are almost never able to get ahead and pay back the principal with such high interest payments every week. Studies show that nationwide, 76% of all payday loans are taken out by borrowers who have paid off a loan within the previous two weeks.” Without proper knowledge of the consequences of these loans, individuals and families end up in worse financial situations than they originally were in.
ARLA’s goals are to advocate for the reform of Alabama’s laws governing small-dollar lending in order to eliminate predatory practices, educate the public about harmful lending practices and products, and encourage the development and marketing of safe, alternative loan products.
Alabama Appleseed legal director, Shay Farley says, “We are pleased to be part of this event to mobilize Birmingham’s faith community towards a common cause. A shared discussion of usury and its impact is a natural bridge for our various networks to join the call to reform Alabama’s high cost lending laws.”
ARLA is a network of congregations, nonprofits and community groups working together to end predatory lending practices in Alabama. ARLA members include: AARP of Alabama, Alabama Appleseed Center for Law & Justice, Alabama Asset Building Coalition, Alabama Possible, Alabama State Conference of the NAACP, Arise Citizens’ Policy Project, Birmingham Faith in Action (includes 25 congregations), Gateway Financial Freedom, First Presbyterian Church of Birmingham, Greater Birmingham Ministries, Leading Edge Institute, Neighborhood Housing Services of Birmingham, Southern Poverty Law Center, The Women’s Fund of Greater Birmingham, YWCA Central Alabama and individuals across Alabama.
Join the fight for fair lending practices in the state of Alabama. Educate yourself and communities about predatory lending and its detrimental and long-lasting effects on Alabama citizens. Establish communication with your legislators. Contact your state representative and/or senator and express your concerns.
The YWCA Central Alabama thanks all of the organizations in ARLA and all of its supporters. If you would like to find out how you can help the YWCA continue its fight against predatory lending, along with its other services, click here.