Lawmakers to draft bill to put restrictions on payday loan lenders

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About one-third of Nevadans use payday loan lenders, but many of the people, who can’t pay it back, get deeper and deeper into debt.  It’s a huge issue nationwide.

However, two months before the next session, state lawmakers will draft bills to put restrictions on lenders.
 
In all, 32% of Nevadans use payday loan lenders, and according to researchers, there are 440 lenders in Clark County.

But why so many?  Justin Gardner of innovative research and analysis says by and large it’s the makeup of the state.

“A lot of the jobs here in Nevada don’t require a lot of education, and so that immediately lends itself to PayDay lending,” Gardner said.

There also isn’t any regulations on how many lenders can open in any area or how many loans a person can take out.

Ameen Sbitani is on his second loan.  He says he hopes it will be his last.

“If you don’t make the payment, they cash the check at your bank,” Sbitani said.  “Last month there was nothing in the bank, and they cashed the check, the bank took care of me, so now you’re indebted to the bank; they took it out today.”

Sbitani is one of many Nevadans trying to avoid getting trapped by lenders.  Garnder says military communities, veterans, African-Americans and people who make under $50,000 a year use payday lenders the most.

All of them exist right where you would expect them to from a literature standpoint, Gardner said.  “In lower socioeconomic neighborhoods, in more diverse communities in transition zones between Henderson and Las Vegas.”

State Treasuer Dan Schwartz is drafting a bill that would include interest rate caps, forming a database and teaching financial literacy in schools.

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