BBB is warning consumers of false information regarding Corpus Christi’s payday loan ordinance

Better Business Bureau

CORPUS CHRISTI, TEXAS - The city of Corpus Christi has enacted a new ordinance which will regulate payday loans. According to the city, the ordinance was made in order to reduce abusive and predatory lending practices. But one consumer told BBB they were given misinformation from their lenders.
A consumer informed BBB that their lender requested she pay down her loan to adhere to the new Corpus Christi ordinance. The ordinance states lenders may not give out payday loans which exceed 20 percent of the customer’s monthly income. For title loans, the loan cannot be more than 3 percent of a consumer’s income or 70 percent of the retail value of their vehicle.
The consumer said the lender requested $600 to comply with the monthly income mandate from the ordinance. However, this was not required.
According to the Corpus Christi officials, loans that were issued prior to Nov. 9 will not be affected by the new ordinance. If your loan is refinanced, the regulations of the ordinance comes into play. Additionally, businesses received a letter from city officials notifying them of the changes.
Other regulations in the ordinance states the business must maintain records of loans given to consumers, must register their business with the city and contracts must be in writing in the language preferred by the consumer.
BBB offers these tips if you have questions regarding the city’s ordinance:

• Call the city office. If you feel the business is violating Corpus Christi’s new ordinance, contact the city development services or city’s legal department. Officials in either department can help you determine if the loan you are about to receive follows the city ordinance. Additionally, officials can verify whether a business is registered and can answer any additional questions you may have.
• Contact the Texas Office of Consumer Credit Commissioner. “Loans that were issued prior to the ordinance taking affect won’t be impacted by the city’s new regulations,” said Corpus Christi Assistant City Attorney Buck Brice. This means if your lender asks for more money in order to follow the new regulations of the city, you should contact the OCCC. The state agency regulates payday lenders and consumers can file a complaint explaining a lender’s possible deceptive practice.
• Check with BBB. Visit BBB’s website at bbb.org to see how the company performs in the marketplace. 

- See more at: http://www.bbb.org/central-texas/news-events/news-releases/2015/new-city-ordinance-raises-questions-for-corpus-christi-consumer/#sthash.TebtTalg.dpuf