Oregon committee hears heated debate over bill to block out‑of‑state lenders from exporting triple‑digit rates

SALEM, Ore. — The Senate Committee on Labor and Business heard more than four hours of testimony on Feb. 23 over House Bill 4,116, a measure that would opt Oregon out of the Federal Depository Institutions Deregulation law’s rate‑exporting provision so that state‑regulated lenders must abide by Oregon’s 36% statutory cap on consumer finance loans.

Representative Nathan Sosa, the bill sponsor, said the measure is aimed at online lending arrangements that pair with out‑of‑state banks to offer Oregonians loans with “triple‑digit” annual percentage rates. “These online lenders are teaming up with banks in Utah … and under [that] arrangement they are lending to Oregonians at rates anywhere from 73% up to over 200%,” Sosa said, adding that his office found roughly 22,000 such loans over recent years and that the typical loan size is about $3,000.

The bill is supported by consumer advocates and community lenders who described the loans as debt traps for people in financial distress. Angela Donnelly of Oregon Consumer Justice told the committee that the opt‑out “will safeguard consumers from exploitive lending practices and foster a fair marketplace.” Ellen Harnick of the Center for Responsible Lending…