Starting next year, Californians who take out consumer loans of between $2,500 and $10,000 can be charged an interest rate no higher than 35 percent. With annual fees, the maximum cost can pencil out to as high as 46 percent.
That’s still significantly lower that the 100 percent-plus interest rates lenders have been charging — legally.
The new lending law is among those passed by California’s Democratic-controlled Legislature and signed by Gov. Gavin Newsom this year.
What does it mean for borrowers and lenders? In this video, CalMatters election reporter Ben Christopher breaks in down in 60 seconds.
The video marks the debut of our #CALaws2020 video playlist. Between now and the end of the year, CalMatters video producer Byrhonda Lyons and the CalMatters reporting team will explain how various new laws that take effect in 2020 will influence the lives of Californians.
You can subscribe to our YouTube channel here.
CalMatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.