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Texas legislature considers short term lending bill

Mar 28, 2011 Todd Milner

The Texas state legislature is considering a bill that would change the way short term lending, a form of short term financing, is regulated within the state.
 Like many similar bills that have made their way through state senates, the Texas bill seeks to more heavily regulate the industry and limit the amount of interest that short term lenders can collect from people on the loans. According to many legal experts, the bills are getting a mixed reception, with consumer advocates in favor of added protections and those within the industry believing they have been unfairly targeted. One of the bill's authors, state Senator Wendy Davis, said that she was hoping to get people out of being trapped by those in the industry. "It's an issue of making sure that vulnerable people are not preyed upon in a predatory way," Davis said in an interview with the Houston Chronicle. "I'm hearing from people who are finding themselves literally in a debtors' prison as a consequence of these loans." In Mississippi, the state government passed a short term lending reform bill with similar consumer protections. The Associated Press reports that the Mississippi House passed a piece of legislation that gives borrowers added time to pay off the short-term financing loans.