(Crain’s) вЂ” With last yearвЂ™s landmark pay day loan reform legislation set to just take impact Monday, a loan provider has sued to end enforcement of the key an element of the measure, claiming it is unconstitutional.
Illinois Lending Corp., which includes six Chicago-area places making payday and installment loans to customers, claims with its lawsuit, filed Monday in Cook County Circuit Court, that its company should be irreparably harmed by the legislation’s provision barring businesses that provide payday advances вЂ” short-term quick unsecured loans targeted at allowing strapped customers to cover bills due before their next paycheck вЂ” from making installment loans, somewhat longer-term borrowings.
The lawsuit, that was assigned to Cook County Circuit Court Judge Carolyn Quinn, states the prohibition violates the business’s constitutional defenses of due procedure and equal security.
The filing for the suit corresponds with a hearing planned the next day before the Illinois home Executive Committee for a bill authored by committee Chairman Daniel Burke, D-Chicago, to get rid of the club on businesses keeping double licenses.
Customer advocates are involved the lawsuit plus the legislative action place at risk the compromise they reached just last year with most of the buyer finance industry after 36 months of negotiations.
What the law states for the time that is first rates of interest loan providers may charge on installment loans.
In addition included conditions directed at stopping lenders from over over over and over repeatedly making new loans to borrowers trouble that is having present with current loans, therefore the language barring customer installment loan providers from acting simultaneously as payday loan providers ended up being a significant part of the, in accordance with Lynda Delaforgue, co-director of Citizen Action/Illinois, a customer advocacy group in Chicago. Read more