For California borrowers trapped in loans with triple-digit interest rates, a proposed bill to impose a 36% cap might seem like a godsend.
If passed, Assembly Bill 539 would end a decades-long practice of allowing installment loans of $2,500 to $10,000 to carry such high interest rates by limiting that number to 36%.
But in striking a deal on the legislation with loan companies, Assemblywoman Monique Limón, D-Goleta, and consumer advocates decided the bill would apply only to interest on the loan itself.