By Howard Fischer | Capitol Media Services via East Valley Tribune
Saying the rates they charge amount to usury, backers of a new initiative seek to outlaw title loans — or at least the interest they are allowed to charge.
Legal papers filed last week indicate voters could be asked next year to remove the exemption that the industry now has from state laws limiting interest to no more than 36 percent a year. Current title loans can carry an annual percentage rate up to 204 percent a year.
Backers need 237,645 valid signatures by July 2, 2020, to put the issue on the general election ballot that year.
The move is being pushed by many of the same organizations that were successful nearly a decade ago in wiping out so-called “payday loans’’ where people could borrow up to $500 for two-week periods at effective interest rates that could exceed 400 percent.
That, however, left the option for people who own their vehicles to borrow against it.