The Journal News published a piece today written by LRANY’s Phoebe Stonbely applauding the AG for assisting a New York woman who was struggling with deceptive loan practices from out of state lenders and encouraging him to look to lawsuit loans under the same light.
“Kudos to Attorney General Eric T. Schneiderman for getting justice for the victims of usurious medical loans from four out-of-state companies. Now is the time for Mr. Schneiderman and our elected officials to take action and stop the similarly predatory practice of “lawsuit lending.”
Lawsuit lenders offer cash advances on pending lawsuits, often at rates in excess of 100 percent annually. Any interest rate higher than 16 percent in New York is considered usury and any rate higher than 25 percent is a criminal violation, so how do they do it? They avoid consumer protection laws by claiming their loans are investments, since the consumer only repays if the lawsuit is won.”