State Lawmakers Debate Payday Loan Company Regulation

FORT WORTH (CBSDFW.COM) – Some payday lenders say they will leave the state if new regulations are passed.

There are several proposed Senate bills that would put limits on interest rates and fees charged by the lenders.

Ace Cash Express President Jay Shipowitz says the change in regulation will cause problems for his business. “If this bill is passed we will be forced to shut our stores down in Texas. We’ll be forced to terminate those 1500 people and they will no longer have jobs here,” he claimed.

Ace Cash Express is based in Irving and has some 500 stores in the state. Shipowitz says his business couldn’t make money with the caps, as proposed.

Senator Wendy Davis, D-Fort Worth, the author of the bill, says she would be happy to work with Shipowitz to come up with limits that will keep him in business.

“If you are willing to sit down and have a legitimate conversation with me about what that number is,” she said. “But unless, and until, you do that my only alternative is to offer what I’m offering right now, which is to put you under the existing lending statue in the state of Texas, that all other lenders have to function under.”

In Texas, payday lenders aren’t actually ‘loan companies’, they operate as credit service organizations (CSOs) and don’t have to adhere to fee and interest caps under Texas Finance Code.

A mid-interest credit card has an annual percentage rate (APR) in the area of 15-percent. For those with a lower credit rating credit card interest rates average in the 25-percent range. In Texas, the rates charged by some payday lenders reach an APR of 500-percent.

According to the Texas Ethics Commission, Ace, and other companies like it, have given Texas officials more than $1.5 million in campaign contributions over the past ten years.

  • Andy Lipsey

    They should all be shut down ! They prey on the desperate and poor. By calling interest refinace fees they make 500% . It was once called ussury and illegal.

    • TG


      They are predatory lenders and part of the reason for the failing economy. 30% is highway robbery. 500% is GRAND THEFT!

  • PNC

    Frankly, I think we have bigger and better things to be discussing and providing solutions for. If the desperate and poor can not figure out they are being taken advantage of then so be it.

    • garlen

      Good then you pay for the bankrupt idiots and leave the rest of the tax payers alone. The trouble is that the problems of the desperate and poor become the problems of the tax payers. The loan shysters skip off with mega profits and leave the mess to the tax payers. Loans on these terms are a virtual guaranty of failure.

  • Albert Lujan

    They put people in a trap. It’s easy to get the loan, but hard to repay if you’re already “paycheck to paycheck”. I should know, it happened to me, so I had no other option but to keep getting more and more loans. It took me a year to get out of that trap. Almost half my paycheck was going towards interest payments.

  • Ronnie

    I thought it was called loan sharking, They are thieves who can robb you with a pencil instead of a gun and say that it is legal, They don’t need a sit down they need to be shut down.

  • State Lawmakers Debate Payday Loan Company Regulation « Fort Worth News Feeds

    […] State Lawmakers Debate Payday Loan Company Regulation Some payday lenders say they will leave the state if new regulations are passed. There are several proposed Senate bills that would put limits on interest rates and fees charged by the lenders. Go to News Source […]

  • PNC

    Again, if you people can’t figure it out and choose a different method to maintain financial health then your just as guilty for being taken advantage of as they ones who are taking advantage of you. Maybe, if you were a little smarter, then these people wouldn’t be in business.

  • Craig

    The United States Military has already regulated pay day lenders to protect our soldiers from predatory lending. Why are the States allowing this to continue? If they can’t survive making 25% interest we really don’t need them in the first place.

    • juan

      states allow it because like the article said these companies give out money to our law makers and in return are allowed to steal from the needy and stupid legally

  • Jimmy

    To PNC: If the focus of this ( or another ) article somehow offends you – be” A LITTLE SMARTER”and pass it by. If your “FINANCIAL HEALTH” is such that you don’t need the services of Payday Loan services – why would you care if the Loan rates were controlled when you are personally unaffected by the Loan Shark interest charged? There could be MANY reasons people need to go to a Payday Loan business particularily in the current economy.Let them eat cake?
    You’re the arbiter of all things? What an outstanding human being!!
    BTW: Which Payday Loan store: Do you own/are you employed by?

  • garlen

    There is virtually no way anyone can off a 500% APR loan. Anyone with a loan like this is going to be on the dole eventually. So why as a tax payer would anybody want these shyster loan guys operating? I know I will get the usual anyone stupid enough to get a loan under these terms deserves it blah blah blah – but when the idiot is bankrupt and on the dole who do you think pays for it – the taxpayer and not the loan shysters

  • Rick McDaniel

    Let them leave, and good riddance.

    Many other states have passed legislation against this kind of rip-off business.

    Now if someone would just do the same about credit card interest. Team Obama was too inept to address that issue.

  • Irish

    What? The payday lenders say that they would not make any money and would have to pack up and leave the state? It must be horrible trying to make a buck when you’re charging almost 500% interest. I have to agree. How could these upstanding, helpful institutions of lending make any money if they can’t rob, I mean lend needy people money?

  • Friedrich Feuerstein

    “Some payday lenders say they will leave the state if new regulations are passed.”

    Ohhhhhhhh I’m SoooOOOOOOooooo scared.

    Well, if it does pass (and I’m hoping it does), as we like to say- Don’t let the door hit your bottom on the way out.

  • greg hunn

    he refers to the employees as
    ‘those people ”
    fffffff him !!!!!!!!!!!

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  • glen

    shut them down, they were fine just cashing cheks, now lets just rip off people is the motto.

  • Belle Rollins

    They don’t want these businesses regulated, they want them shut down. Davis and her supporters need to be up front with their legislation; but no one wants to say they’re going kill thousands of jobs in a recession.

  • Sara

    As a former employee of ACE Cash, they need to be put out of business, Jay and his co-horts only care about what they can make off people. Employees have been robbed and kill for the money in his stores. Ace Cash preys on lower income people so that Jay can live in his big fine house, drive his fine cars, and live his high-life lifestyle.

    Shut’m down.

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