Virginia approves car title lending bill

Despite resistance from some legislators, a law allowing Virginia-based car title lenders to make loans to people living outside the state survived a recent House vote. The ruling comes after a six-month ban that blocked out-of-state residents from getting cash from car title lenders. That law, passed in October, also requires the car title loan industry to fully disclose interest rates to potential borrowers, The Washington Post reports. Senate Majority Leader Richard L. Saslaw, a Democrat, sponsored the bill and told the paper that consumers knew the terms of the loans and would not get something they did not want. "If there's no demand for it, then people wouldn't drive from Maryland or West Virginia or anywhere else to get car title loans," he said. The loans are useful for consumers seeking an alternative source of cash that does not involve complicated terms. Title-lending lobbyist Scott Johnson told The Virginian-Pilot that legislation such as the law passed in Virginia would also help people who come to the state for work and need extra money. Some state legislatures have targeted short term and car title lending companies, but other states have protected lenders who serve cash-strapped consumers. Lawmakers in Kentucky recently knocked down a bill that would have capped rates on short term lenders.