Religious Leaders and Veterans Advocates Urge Congress to Set National Lending Rate Cap by Passing Fair Credit Act for Veterans and Consumers


VCFCA will protect veterans and working families from predatory loans

WASHINGTON – On Monday, members of the Faith for Just Lending coalition and military family advocates called on the US Congress to protect working families, including veteran families, from abusive payments, car title and other expensive installment loans passing the Veterans and Consumers Fair Credit Act (VCFCA).

The legislation would expand the protections of the Military Loans Act, which caps payday loans, auto title loans, and installment loans at an annual percentage rate (APR) of 36% for serving military service members. active, their spouses and some dependents, to veterans and all Americans. Senators Jack Reed (D-RI), Sherrod Brown (D-OH) and Jeff Merkley (D-OR) introduced the Fair Credit Act for Veterans and Consumers in July.

Payday, Car Title, and other shady lending practices are targeting military families, veterans and vulnerable Ohio consumers with predatory high-interest loans designed to trap them in a cycle without end of debt, ”said Senator Sherrod Brown, chairman of the Senate Committee on Banking, Housing and Urban Affairs. “We must end these abusive and immoral debt traps by extending the 36% cap on Military Lending Act interest rates to everyone, including veterans and surviving family members. I co-sponsored the Fair Credit for Veterans and Consumers Act to do just that.

Members of the Faith for Just Lending Coalition, which represents millions of Christians across the United States, joined military family advocates in urging Congress to act.

“As Congress continues to deliberate on the Build Back Better Act, we must not lose sight of the many families trapped in a cycle of predatory payday loan debt who are struggling to pay the bills, keep their money down. food on the table and save for the next emergency, ”said Katie Thompson, director of the shared justice program, an initiative of the Center for Public Justice. “As we honor veterans this week, there’s no better time to enact legislation that will protect veterans and all Americans from these harmful loan products.”

Taking advantage of loopholes and the weakening of traditional usury laws, payday lenders typically offer loans at 300% APR and above to the 12 million consumers who use payday loans each year. Researchers have found that four out of five payday loans are re-borrowed every two weeks, indicating they are unaffordable.

“Congress knows that payday loans are nothing but legalized loan fraud,” said Rev. Dr. Willie Gable, pastor of the Progressive Baptist Church, chair of the Housing and Housing Commission. Economic Development of the National Baptist Convention, USA, Inc., and a United States Air Force Veteran. “We ask Congress in good conscience to pass reforms that protect our military and all Americans from this predatory abuse.”

“Payday loans are an unfair business practice that benefits consumers and traps them in cycles of debt,” said Chelsea Sobolik, director of public policy at the Ethics and Religious Freedom Commission of the Southern Baptist Convention. “A just government has a responsibility to prohibit predatory lending behavior and to protect the ‘weak, poor and vulnerable’ under its authority.”

“It’s very close to home both as a grandson of veterans and pastor of veterans. And it’s a question about the nation’s moral ledger, not just the fiscal ledger, but the moral ledger, ”said Rev. Gabriel Salguero, president and founder of the National Latino Evangelical Coalition (NaLEC) and pastor. by The Gathering Place.

“What protections do we guarantee for those who are ready to make the greatest sacrifice of their lives and their families? And what does it mean that predatory loans are almost 400%, for some of the most vulnerable… now is the time to act, and without delay. “

“As we, as faith communities, do our part to ensure that our neighbors have the financial resources they need in times of crisis, we recognize that the government must do its part to ensure that the usury is prohibited, predatory and deceptive. lending practices are eliminated, ”said Reverend Sekinah Hamlin, Minister of Economic Justice at The United Church of Christ. “We are doing our part. We need the government to do its part now. “

The Military Loans Act (MLA) prohibits lenders from charging military service members and their families more than 36% APR. The limit was proposed by the Defense Ministry after finding that high-interest loans were devastating troops ‘finances and hurting forces’ readiness. It was enacted with strong bipartisan support in 2006. In a May 2021 report to Congress, the Defense Department confirmed that the military has benefited from the MLA, writing that the law “is working as intended.”

“The Military Loan Act is one of the most effective consumer protections our country has implemented,” said Cory Titus, director of veterans benefits and custody / reserve affairs at the Military Officers Association. of America and U.S. Army Veteran. “We have a good policy that works, we should be looking to extend it beyond those on active duty in the military. MOAA supports the VCFCA to extend loan protections for the reserve component, veterans, survivors and all Americans. “

The Fair Credit Act for Veterans and Consumers was introduced to Congress last in both houses and is expected to be presented to the House later in this session of Congress.


Faith for the righteous loan is a coalition of faith-based institutions working to end predatory payday loans. The Faith for Just Lending Steering Committee includes Catholic Charities USA, Center for Public Justice, Cooperative Baptist Fellowship, Ecumenical Poverty Initiative, Ethics & Religious Liberty Commission of the Southern Baptist Convention, Faith in Action, National Association of Evangelicals, National Baptist Convention USA , National Latino Evangelical Coalition, The Episcopal Church, United Church of Christ, and United States Conference of Catholic Bishops.

Jennifer P. Gore
Public justice center
[email protected]

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of Religion News Service or the Religion News Foundation.


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