Virginia Fairness in Lending Act of 2020 Reforms Small Credit

Virginia Fairness in Lending Act of 2020 Reforms Small Credit

This particular fact sheet had been updated Nov. 11, 2020 to explain certification demands for online lenders as well as the applicability of this Virginia customer Protection Act to loans that are small-dollar.

After many years of legislative efforts to foster a safe and market that is viable tiny loans, Virginia lawmakers in 2020 passed bipartisan legislation—the Fairness in Lending Act—to reduce prices and prohibit loans with big last repayments, called balloon repayments. The law rationalizes exactly what was indeed a disparate structure that is regulatory governed by a patchwork of laws and regulations that permitted payday and auto name loans with unaffordable repayments and unnecessarily high costs and exposed borrowers to monetary damage, including duplicated borrowing and high rates of automobile repossession. The latest measure produces more uniform rules for lending to borrowers with slim or damaged credit records, no matter whether loans are manufactured at a retail location or online or if the loan provider is a payday, name, installment, or technology firm that is financial. This dining table summarizes key components of the law that is new. (more…)

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