High-cost lenders—the makers of payday, auto-title and installment loans—exploit laws tipped in their favor to sue tens of thousands of Americans every year. The shocking result? A $1,000 loan grows to $40,000.
In 2008, payday lenders suffered a major defeat when the Ohio legislature banned high-cost loans. That same year, they lost again when they dumped more than $20 million into an effort to roll back the law: The public voted against it by nearly two-to-one. But five years later, hundreds of payday loan stores still operate in Ohio, charging annual rates that can approach 700 percent.