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Proposed Payday Loan Ordinance

City Councilors consider placing restrictions on payday loan agencies.
MIDLAND, TX (Big 2 News)-A push to prevent predatory lending in Midland is underway. City leaders say payday lenders operate within a loophole of Texas law, acting as a broker who gives someone a loan for a significant fee, thus avoiding interest limits.

Now, Midland Mayor Jerry Morales is leading the charge to reign in what the Council calls abusive and predatory lending.  Mayor Morales hopes a proposed ordinance with a series of restrictions aiming to regulate payday lenders will soon pass the council.  According to reports, some cities in Texas have faced lawsuits from payday lending agencies because the lenders do not want restrictions.
"We knew it was going to be a challenge going up against the court systems and trying to regulate these payday lending institutions," says Morales about the proposed ordinance. 

Morales says a judge recently dismissed a lawsuit against a similar ordinance in the city of Dallas, and therefore expects an ordinance in Midland would see similar success.

"But we have been able to put ordinances that don't do away with payday lending, but definitely put some requirements in there so that it doesn't affect their citizens," explained Morales. 

Morales points to Midland's high cost of living as a reason this ordinance should be a priority for the council.
"Our citizens go to these payday lending institutions to help pay for their rents or car payments which they need to get to work and live and protect their little ones," Morales elaborated.

He says often times when people take a loan from a payday lender they get stuck on a loop of high fees and are never able to pay off the original loan. If the proposed ordinance passes, it will go into effect as early as July first. Each violation would cost businesses a fine up to five hundred dollars a day.
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