Illinois regulators answer queries on predatory lending law

SPRINGFIELD, Ill. (AP) - Illinois state regulators have released answers to frequently asked questions about payday-type loans after new restrictions took effect this spring.

The information from the Department of Financial and Professional Regulation is aimed at helping consumers understand the Predatory Loan Prevention Act.

That legislation signed into law by Gov. J.B. Pritzker on March 23 prohibits loans with an annual percentage rate of more than 36%. Loans covered by the law but taken after March 23 are void and lenders may not attempt to collect any part of it.

The law covers a variety of financial instruments, including payday loans, pawn loans, 'œbuy-here-pay-here'ť agreements, car and title loans.

The law does not cover loans made by banks, credit unions, insurance companies or similar financial institutions. State regulators suggest working with lenders who are licensed by the state or are federally regulated.

___

FAQs about the Predatory Loan Prevention Act: https://bit.ly/3aZtIR5

___

This story has been corrected to reflect that loans taken after March 23 are void, not loans before March 23.