Delaware is one of a handful of states that has no cap other than unconscionability on interest rates for short-term consumer loans. Under Delaware case law, the unconscionability of an interest rate is decided by a court on a case by case basis.
So Representative Sean Lynn has introduced House Bill 143, which caps interest rates at 20% for short-term consumer loans of $1,000 or less that must be repaid in less than 60 days. It also caps interest rates at 20% for motor vehicle title loans.
Essentially, the loans covered by this cap are the notorious Pay Day Loans. And as you can see by the map above, Delaware is only one of two states in the Northeast that allows such nonsense.
|HOUSE BILL 143 – INTEREST RATE CAP OF 20% FOR SHORT TERM CONSUMER LOANS OF $1K OR LESS AND CAR LOANS||Currrent Status – House Economic Everything 5/10/23|
|House Sponsors – Lynn, Johnson, Williams, Longhurst, Morrison||Senate Sponsors – Lockman, Pinkney, Gay, Hansen, Poore, Sturgeon|
|House Yes Votes –||Senate Yes Votes –|
|House No Votes –||Senate No Votes –|
|House Absents or Not Voting –||Senate Absent or Not Voting –|