Car title lending a booming business in Virginia

More than $21 million worth of car title loans have been given out in Virginia since last October, when the industry began to be regulated. "It shows that it's needed," said Scott Johnson of Community Loans of America. "It shows that you still have a large number of Virginians that don't have other means of credit." Despite limitations enacted last year that govern how much companies can lend and for how long, more than 3,500 borrowers missed payments for at least 60 days during the October to December period. Recent data from the State Corporation Commission indicates that of the 200 vehicles that were repossessed, two were sold, indicating that title lenders are willing to work with customers on collecting debts. The number of car title loans is set to increase as a result of Virginia legislators' decision to allow the state's companies to extend loans to citizens of other states, regardless of whether those states have banned car title lending. Elsewhere in the nation, the recent passage of Senate Bill 57 in New Hampshire allowed the maximum interest rate on car title loans to significantly increase from 36 percent per year to 25 percent per month, easing a 2009 cap.