Illinois Governor J.B. Pritzker signed a bill that imposes a 36% APR cap on all consumer loans. The Predatory Loan Prevention Act was passed by the state legislature on January 13th and went into effect immediately upon Pritzker’s signature.
Under the new bill, “a lender shall not contract for or receive charges exceeding a 36% annual percentage rate on the unpaid balance of the amount financed for a loan.” This applies to “any person or entity that offers or makes a loan to a consumer in Illinois.”
36% APR Cap: Failure to Comply
- Any loan that violates the act would be rendered null and void
- “No person or entity shall have any right to collect, attempt to collect, receive, or retain any principal, fee, interest, or charges related to the loan.”
- Each violation would be subject to a $10,000 fine
17 other states and the District of Columbia have already imposed a 36% interest cap on on payday loans.
If you are operating in the state of Illinois, please contact us with any questions regarding this development.