As early as Valentine’s Day, the House of Representatives will vote on Rep. McHenry’s legislation, H.R. 3299, which would let financial companies, including online payday and installment lenders, charge North Carolinians 100 percent APR and potentially far higher – and override our state’s interest rate caps. If this bill becomes law, it would bless the “rent-a-bank” scheme whereby these nonbank entities form sham partnerships with banks that technically originate the loan in order to evade strong state laws. It’s also the same type of scheme that the payday lenders used to make illegal loans in North Carolina for five years after payday lending was outlawed in our state.
