Springfield, IL (CAPITOL CITY NOW) – Transparency in lending is the goal of “APR for All,” and backers believe they now have the right sponsor to finally make it law.
“It’s not ‘Strange Metrics for All,’ it’s not ‘APR for a Select Few Who Meet Certain Criteria,’ it’s ‘APR for All,'” said State Rep. Mary Beth Canty (pictured) (D-Arlington Heights). “APR (Annual Percentage Rate) is the gold standard for comparing loan costs.”
The bill , supported by Treasurer Mike Frerichs, requires non-bank lenders to disclose the annual percentage rate of loans offered to small businesses. Proponents say this shows the actual cost to borrowers.
“If a lender determines that another benchmark is more representative of the cost-to-capital, given the structure of that particular loan, so be it. Go for it! Just make sure that APR is included alongside any other calculation so that a borrower can compare apples to apples as they shop around for other loans with other lenders that may have different terms,” said another advocate, Horacio Mendez, president and CEO of the Woodstock Institute.
