House Cmte. Approves Payday Loan Bill

Payday borrowers could no longer roll over their loans and pay more fees, under a bill approved in a House committee.

Republican Eddie Farnsworth voted against the measure.

"We're going to essentially run that particular market - goes contrary to what I think the Legislature should be doing - I don't think we should be mandating repayment terms," says Farnsworth.

The bill would give borrowers an extra 90 days to make installment payments, without additional interest or fees. But they'd be barred from taking out a second loan.

Kathy Jorgenson of St. Vincent de Paul's says it's now too easy to walk down the street and borrow again.

"According to data supplied by the Children's Action Alliance, there are now more payday loan facilities in Arizona than there are Starbucks and McDonalds combined," she says.

"In the real world and on a daily basis we meet people who have 5, 6, 7, 8. I met one man who had 10 loans at the same time."

The bill also creates a database so that lenders can make sure nobody gets a second loan.

Next stop is debate by the full House.