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Kentucky to debate limiting short term loan rates

Jan 24, 2011 Todd Milner

Kentucky is the latest in a line of states that has or will debate putting caps on interest rates for short term loans. This week, the Kentucky legislature will discuss whether or not to put a 36 percent limit on interest rates. The bill has received support from an important public interest group, The Family Foundation of Kentucky. The foundation's executive director, Ken Ostrander, indicated in a statement that he would be willing to back the 36 percent interest ceiling and let the market sort out the issues with short term lending centers, though he calls for more competition in the market. "The market should also be broadened, in our opinion, so that even some of the more established lending institutions - banks - should perhaps get involved and not only make money through established credit but also through those that don't have established credit," Ostrander stated. In Wisconsin, short term lending rates still remain a contentious issue as uncertainty reigns among the state's legislature. Eight months ago, Wisconsin lawmakers put new restrictions and regulations on short term loans, but now they are reconvening to discuss how to close potential loopholes, the Milwaukee Journal-Sentinel reports.