FOR IMMEDIATE RELEASE: April 14, 2020
CONTACT: Jenna Severson, 616-914-2844, jseverson@woodstockinst.org
Advocates Applaud Governor Pritzker for Taking Steps to Protect Illinoisans’ Stimulus Checks
Concerns Remain About Lenders Taking the Payments
CHICAGO: Consumer advocates applaud the State of Illinois for protecting Illinois families from unnecessary additional financial hardship related to the economic fallout of the COVID-19 crisis. Today, Governor Pritzker issued Executive Order 2020-25, which stops the issuance of court orders that would permit debt collectors to garnish accounts.
“Today’s executive order is a big step toward protecting vulnerable Illinoisans’ stimulus checks from being siphoned away by debt collectors. We remain concerned that thousands of Illinoisans will have their stimulus checks consumed by non-essential loan payments instead of critical needs like shelter, food, and medicine,” said Brent Adams, Senior Vice President of Policy & Communication at Woodstock Institute.
In addition to the Executive Order, the Department of Financial & Professional Regulation issued a document entitled “Best Practices” that advises payday lenders, auto title lenders, and installment lenders: “[T]he Department expects Illinois consumer credit licensees to work proactively with consumers during this crisis, and to be flexible with repayment of debt.” The “Best Practices” are only recommendations and have no legal force. Consumer advocates and Senator Jacqueline Collins, Chair of the State Senate Financial Institutions Committee, have asked the Department to issue orders that would compel the lenders to stop automatic payments temporarily to eliminate the chance that a stimulus check will be devoured by a loan payment that a recipient wants and needs to feed their family.
“The last thing that families should have to worry about is whether their stimulus check will be swiped by debt collectors. We applaud Governor Pritzker for taking action to protect these checks,” said Jody Chong (Blaylock), Associate Director for Research & Policy at Heartland Alliance.
Woodstock Institute and its allies also sent a letter to the Governor on April 9, 2020, urging that the State take action to protect borrowers’ from having their stimulus checks siphoned off by payday lenders.
Other notable actions by the State of Illinois to lessen the negative financial impact on Illinois residents, include guidance by IDFPR for its regulated financial entities including state banks, credit unions, installment lenders, payday lenders, title loan lenders, sales finance lenders (including auto loans), currency exchanges, student loan servicers, mortgage servicers, and collection agencies concerning their lending, servicing, and collection, in response to advocates’ recommendations on March 30, 2020. The Governor also issued Executive Order 2020-16, which placed a moratorium on car repossessions and starter interrupters, or “kill switches,” through which a lender can remotely stop a borrower from being able to start a car or truck after falling behind on payments.
Woodstock Institute encourages every consumer to call their creditors and ask for financial assistance. See more tips for consumers at bit.ly/borrowersbeware.
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Woodstock Institute is a leading nonprofit research and policy organization in the areas of equitable lending and investments, wealth creation and preservation, and safe and affordable financial products and services. Woodstock Institute works locally and nationally to create a financial system in which lower-wealth persons and communities of color can safely borrow, save, and build wealth so that they can achieve economic security and community prosperity.
Illinois PIRG Education Fund is an independent, non-partisan group that works for consumers and the public interest. Through research, public education and outreach, we serve as counterweights to the influence of powerful special interests that threaten our health, safety or well-being. www.illinoispirgedfund.org
Heartland Alliance for Human Needs and Human Rights – Heartland Alliance, one of the world’s leading antipoverty organizations, works in communities in the U.S. and abroad to serve those who are homeless, living in poverty, or seeking safety. It provides a comprehensive array of services in the areas of health, housing, jobs and justice – and leads state and national policy efforts, which target lasting change for individuals and society. www.heartlandalliance.org