New Illinois Law Targets Payday Loans

By Jennifer A. Bowen, News-Democrat

A state law signed Thursday is intended to hurt predatory lenders’ ability to make bad loans that cost people their homes.

While the state plans to test the system in parts of Chicago with high foreclosure rates, the potential for the program to spread to the rest of the state concerns local real estate experts. They worry about government interference in personal lives and how well the state will protect sensitive, personal financial data.

“(The law) is kind of draconian,” said Donn Schaefer, president of I Buy Houses and president of the Metro East Landlords’ Association. Schaefer has been in the business of buying and selling homes for the past 24 years.

“If this passes in Chicago, then that’s the camel’s nose into the tent. Who knows where it’s going to stop,” Schaefer said. “Why does the government need to know if I’m a good credit risk or not? That’s up to the private lenders to decide. This is a capitalist country, not a communist country.”

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