WASHINGTON – The Obama administration wants to put a stop to excessive payday or car title loans for military service members.
Continue Reading Below
The Defense Department is trying to close legal loopholes that have put hundreds of thousands of service members at risk of excessive fees.
New rules would toughen the Military Lending Act's limits on interest rates for certain types of credit for service men and women and their dependents.
Under current law, lenders cannot charge members of the military more than 36 percent interest. But loans covered by the law are so narrowly defined that lenders can make simple adjustments to get around its provisions.
The proposed rules would broaden the definition of consumer credit so that more loans would fall under the 2006 law.