Weekly Column: Predatory Lending Continues Its March Through Virginia and U.S. 1

The following is my column that will appear in the Mt. Vernon Gazette and The Mt. Vernon Voice in the week of June 23, 2015.

Predatory Lending Continues Its March Through Virginia and U.S. 1

The Virginia’s State Corporation Commission latest annual report says that predatory car title lending is thriving in Virginia .  With nearly three dozen car title lenders between Alexandria and Quantico on U.S. 1, this is troubling news, except to the lenders out to make big profits.    You can read the full report on my online newsletter –The Dixie Pig – at scottsurovell.blogspot.com.  

Access Full SCC Report Here 

Car title lending began in our state in 2010 after Virginia limited interest rates on payday loans and predatory lenders argued that a new option was needed.  Virginia law authorizes lenders to lend money at rates up to 30% per month which equates to around a 297% annual percentage rate (APR).  A consumer can  borrow up to 50% of their vehicle’s equity and the loan term is limited.   

California Ordered to Repay $331 Million - Is Virginia Next?

Today, $350 million worth of chickens came home to roost in California.  Virginia might be next and here's why. 

In the aftermath of the 2008 mortgage-driven financial crash, federal, state and local government budgets were walloped.  One of the jurisdictions hardest hit with foreclosures was Prince William County.  Property values plunged.  Vacant houses were everywhere as people dumped houses that they could never afford with adjustable rate mortgages coming due for readjustment purchased with "no doc" loans.

In 2011, Attorneys General across the United States reached a $25 billion settlement with five major banks regarding illegal and abusive mortgage lending practices.  Virginia's share of the settlement was over $66 million and was directed to Attorney General Ken Cuccinelli to disburse.  As part of a floor debate, I made the card on the right.   

Here's what the court's order said Virginia could do with the money:

Each State Attorney General shall designate the uses of the funds set forth in the attached Exhibit B-1.  

To the extent practicable,such funds shall be used for purposes intended to avoid preventable foreclosures, to ameliorate the effects of the foreclosure crisis, to enhance law enforcement efforts to prevent and prosecute financial fraud, or unfair or deceptive acts or practices and to compensate the States for costs resulting from the alleged unlawful conduct of the Defendants.  

Such permissible purposes for allocation of the funds include, but are not limited to, supplementing the amounts paid to state homeowners under the Borrower Payment Fund, funding for housing counselors, state and local foreclosure assistance hotlines, state and local foreclosure mediation programs, legal assistance, housing remediation and anti-blight projects, funding for training and staffing of financial fraud or consumer protection enforcement efforts, and civil penalties.  

Accordingly, each Attorney General has set forth general instructions for the funds in the attached Exhibit B-2.

What did Virginia do in the 2012 Session? 

My Endorsement for Mount Vernon Supervisor

With the retirement of Supervisor Gerry Hyland, Mt. Vernon is losing passionate fighter with decades of experience. Our next Supervisor must be an experienced leader that will fight for our community's fair share of resources and who has a track record and results.

Mount Vernon has four good candidates who are running.  Each have their accomplishments and positive attributes.

However, Dan Storck is the only choice for Mount Vernon and I am proud to endorse his campaign for Supervisor for the TUESDAY, JUNE 9 DEMOCRATIC PRIMARY. 

Dan has lived in the Stratford Landing neighborhood of Mount Vernon for over 25 years with his wife Deb and their three children. He previously served as President of the West Potomac High School PTSA and President of Good Shepherd Housing's Board. Dan was first elected as the Mount Vernon Representative to the Fairfax County School Board in 2004. 
 

Unlike the other candidates, Dan can also point to specific concrete results that he has achieved for the Mount Vernon District.

• Opened three brand new schools (South County H.S., South County M.S. and Laurel Hill E.S.) in Mount Vernon in order to tackle overcrowding issues
• Worked to fund construction for two entirely new elementary schools on the Route 1 Corridor in the next few years (at Fort Belvoir E.S. #2 and Pinewood Lake-Area E.S.)
• Renovated or expanded ten existing Mt. Vernon schools with an additional Mt. Vernon seven schools in planning or currently under renovation
• Personally re-worked the financing of the South County Middle School development and saved taxpayers $35 Million in financing
• Fought for full-day kindergarten for all Fairfax County Schools
• Created the Smart Services, Smart Savings initiative that has saved taxpayers $1 million by increasing efficiency and cutting unnecessary costs
• Secured a needs-based staffing formula which secured a lower relative student-teacher ratio for most Mt. Vernon area schools
• Fought to create the Priority School Initiative which supplements staffing at the neediest schools
• Prioritized teachers' salaries in the budget

Dan understands the challenges facing Mount Vernon's schools because he has been forced to deal with the underfunding of our schools for the last twelve years and understands why Supervisor Gerry Hyland has been fighting to raise funds for our schools for years.  Like Supervisor Gerry Hyland, fully-funding Fairfax County Public Schools will be a priority for Dan.

Dan also understands that the strength of our schools is directly tied to the quality of housing and transit on the Route 1 Corridor and has made clear to me that he will work to revitalize Route 1 and extend the Yellow Line as soon as possible.

He has also made clear that he finds the explosion of predatory lending on U.S. 1 intolerable and that he will fight to get them under control. 

In order to fight for these priorities, he needs your support.   Please join me in voting for Dan Storck on Tuesday, June 9 and click below to get involved with his campaign this week.