The Consumer Financial Protection Bureau will propose new federal limits today on payday and auto title loans to help borrowers avoid what the agency says is often a “debt trap” for millions of Americans.
The federal agency, which was created by the Dodd-Frank law adopted by Congress in 2010 in the wake of the financial crisis, is proposing rules to require payday lenders to take steps to make sure consumers have the ability to repay their loans and to give notice before making checking account withdrawals for loan repayments.
“Too many borrowers seeking a short-term cash fix are saddled with loans they cannot afford and sink into long-term debt,” said CFPB Director Richard Cordray, who will unveil the new rules dur…
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