Kesha Warren needed a short-term cash infusion of $1,250 to make payroll costs for her small janitorial services company
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“No one wants to lend to someone that has $100,000 in student loans, so it was very hard for me to get a traditional loan,” Warren said.
The loan came with a yearly interest rate of 197%. That ballooned her initial $1,250 loan into a total payment of $3,400 that she paid off early last week. Had she not done that, it could have cost her another $2,000.
South Side state Sen. Jacqueline Collins co-sponsored the Illinois Predatory Lending Prevention Act, which would cap annual interest rates on short-term loans at 36%.
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“Anything above 36% is predatory and usury,” Collins said. “So we know that high-cost payday loans and auto loans have stripped communities of billions and billions of dollars, primarily the Black and Brown communities in the state of Illinois.”