[Congressional Record Volume 162, Number 113 (Wednesday, July 13, 2016)]
[Extensions of Remarks]
[Page E1099]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   FINANCIAL SERVICES AND GENERAL GOVERNMENT APPROPRIATIONS ACT, 2017

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                               speech of

                          HON. RUBEN HINOJOSA

                                of texas

                    in the house of representatives

                         Thursday, July 7, 2016

       The House in Committee of the Whole House on the state of 
     the Union had under consideration the bill (H.R. 5485) making 
     appropriations for financial services and general government 
     for the fiscal year ending September 30, 2017, and for other 
     purposes:

  Mr. HINOJOSA. Mr. Speaker, I rise in support of this amendment and I 
thank my colleague, Representative Sewell, for standing up for 
consumers.
  Time and time again, we hear about hard-working families being 
exploited by predatory, small-dollar, short-term lenders, such as 
payday lenders. While these loans are meant to help underserved 
individuals in need of quick cash, far too many times the borrower ends 
up trapped in a vicious cycle of rollovers, fees and more debt.
  We sell our families short when we accept that high-interest loans 
are the best we can do for our communities. Payday and auto title 
loans, with uncapped annual percentage rates, have long enticed 
families in moments of desperation--offering short-term fast cash at 
the cost of long-term debt--at rates averaging 500 percent APR.
  In my home state of Texas, an average $500 payday loan costs an 
astounding $1,100 or more to repay in a period of just a few months. 
Moreover, in Texas, payday and auto title lending is a $5.8 billion 
industry with over 70 percent of the volume from refinances and fees. 
In fact, four of every five payday loans are rolled over or renewed 
within 14 days with the majority of those costing the consumer more in 
fees than they borrowed, according to a CFPB study.
  Thankfully, the CFPB has taken the lead in proposing to rein in these 
predatory and harmful loans. We should be fighting to eliminate 
excessively high-interest rates and debt-trap cycles that define much 
of today's payday and auto title loan lending landscape, rather than 
fighting against the CFPB's efforts.
  Unfortunately, this financial services and general government 
appropriations bill enshrines the status-quo of debt-traps and 
mountains of fees for consumers without any protections afforded by the 
CFPB's proposed rule.
  I applaud the CFPB's rulemaking efforts in this area, and I hope it 
ushers in a new era of responsible lending.

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