[Congressional Record Volume 172, Number 26 (Thursday, February 5, 2026)]
[Senate]
[Pages S511-S512]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. REED (for himself, Mr. Blumenthal, Ms. Duckworth, Mr. 
        Fetterman, Mr. Heinrich, Mr. Lujan, Mr. Merkley, Mr. Padilla, 
        Mr. Schatz, Ms. Smith, Mr. Van Hollen, Mr. Whitehouse, Mr. 
        Warnock, Mr. Welch, Mr. Wyden, and Mr. Booker):
  S. 3793. A bill to amend the Truth in Lending Act to extend the 
consumer credit protections provided to members of the Armed Forces and 
their dependents under title 10, United States Code, to all consumers; 
to the Committee on Banking, Housing, and Urban Affairs.
  Mr. REED. Mr. President, today I am reintroducing the Predatory 
Lending Elimination Act along with many of my colleagues. This 
important legislation would extend the bipartisan Military Lending Act, 
MLA, protections for Active-Duty servicemembers and their families to 
all Americans by imposing a nationwide 36 percent cap on the annual 
percentage rate, APR, for most extensions of consumer credit.
  The MLA was enacted on a bipartisan basis in 2006 to rein in payday 
and other unscrupulous lenders that targeted American troops with 
abusive and predatory loans. Unfortunately, the MLA does not protect 
veterans or Gold Star families from these exploitative practices. 
Servicemembers and

[[Page S512]]

their families should not lose important consumer protections simply 
because they retire, separate from honorable service, or lose their 
loved ones. Frankly, all Americans deserve to be shielded from these 
kinds of predatory loans, and that is just what our bill does.
  Hundreds of millions of American consumers could benefit from a 36-
percent APR cap. In States that do not have such a cap, predatory 
lenders can offer loans with triple-digit APRs that trap individuals in 
cycles of debt. For instance, the Consumer Financial Protection Bureau 
found that 80 percent of payday loans are rolled over or renewed within 
2 weeks. This practice can subject borrowers not just to high nominal 
interest rates but also to high fees that can quickly surpass the 
amount of money originally borrowed. These are hallmarks of predatory 
lending and poor underwriting.
  According to a coalition of community organizations, payday lenders 
are known to target the most vulnerable, including seniors, veterans, 
and low-income borrowers. Many in these communities are already 
struggling to make ends meet as they navigate the President's tariffs 
and stubbornly high prices, and are continuing to pay exorbitant APRs 
may cause them to fall deeper into economic insecurity. This is why it 
is important to extend strong protections against unscrupulous lenders 
to all Americans.
  The MLA's successful track record demonstrates that providing 
reasonable, responsible limits on interest rates does not cut off 
consumers' access to credit. According to a May 2021 report from the 
Department of Defense, ``credit cards, auto loans, and personal loans 
are widely available at risk-based rates under the 36 percent 
[military] APR'' and ``[s]ervice members continue to have ample access 
to necessary credit.''
  Moreover, this legislation would follow the trend in many States 
towards greater protections against predatory loans. Nineteen States 
and the District of Columbia have enacted 36 percent APR caps or banned 
payday loans. Lenders in these States have incentives to offer more 
affordable loans that borrowers have an ability to repay. The same 
incentives should apply across the Nation.
  I thank the 176 consumer advocacy groups, faith-based organizations, 
veteran service organizations, and trade associations that support this 
bill, including the Consumer Federation of America, the National 
Consumer Law Center, on behalf of its low-income clients, the Center 
for Responsible Lending, Americans for Financial Reform, Amalgamated 
Bank, the Military Officers Association of America, and the National 
Military Family Association.
  I urge our colleagues to join us in supporting this important 
legislation.
                                 ______