The Rev. John Copenhaver of the United Methodist Church and vice chairman of the Valley Interfaith Council speaks at a protest near the Advance America office at 2124 S. Pleasant Valley Road on Friday. Copenhaver and other religious leaders say car title and payday loan companies like Advance are guilty of predatory lending to poor people because of high annual percentage rates on loans that trap borrowers into debt.

WINCHESTER — Car title and payday loans are billed as short-term fixes for people low on cash, but critics say they’re legalized loan sharking due to astronomical annual percentage rates (APR) that trap vulnerable borrowers into endless cycles of debt.

In Virginia, the APR for a 14-day, $100 loan is 687% percent, according to the Consumer Federation of America.

“It’s perfectly legal. That’s the saddest part about this,” the Rev. John Copenhaver, Valley Interfaith Council vice president, told 26 people during a protest on Friday near the Advance America payday lending office at 2124 S. Pleasant Valley Road. “These mostly out-of-state lenders are profiteering on the financial struggles of our citizens. Fixing predatory payday lending and car-title lending in Virginia is long overdue.”

Protest organizers said they selected Advance America because it’s one of the nation’s biggest payday lenders and charges far higher rates in Virginia than in other states. Copenhaver said the cost the company charges to borrow $500 for five months is $110, or 22% of the loan, in Colorado. In Ohio, it’s $193 or about 38%.

In Virginia, it’s $600 or 120% of the loan.

Copenhaver didn’t have a state-to-state comparison on car-title loans, but the APR’s advertised at Advance’s Winchester store are steep. For example, a $300-loan financed over a year would cost the borrower $875 to pay off in a year, about 291% of the loan. For a $1,000 loan financed over a year, total payments are $2,401, or 240%.

Failure to repay a car-title loan can result in the car being repossessed. Nearly 12,000 of the 122,000 Virginians who took out car-title loans in 2017, or about 10%, had their vehicles repossessed, according to the Office of the Virginia Attorney General.

At the protest, billed as Fair Lending Fridays, religious leaders from several different faiths said predatory lending is blasphemous. They noted most loan customers get caught in a debt spiral known as “churning” in which customers are forced to continue borrowing because they can’t afford to pay the original loan.

About 80% of borrowers nationally roll over or renew loans within two weeks, according to a 2014 report by the Consumer Financial Protection Bureau. Just 15% of borrowers repay all their debts without re-borrowing within 14 days and 64% renew at least one loan one or more times.

“While marketed as a short-term solution to emergency expenses, neither is typically the case, “ said the Rev. Kristin Whitesides, pastor of First Baptist Church in Winchester. “We must work together to break this cycle of recurrent debt that traps far too many of our neighbors.”

The protest was organized by the Virginia Poverty Law Center, which held a similar protest last month in Richmond, according to Jamshid Bakhtiari, the center’s consumer advocacy campaign coordinator. He said protests are planned in Fairfax and Hampton Roads in the next few months. Bakhtiari said one of the goals is to get the legislature to reduce Virginia’s APR’s to the Ohio rate.

“We’re not trying to put Advance America and other predatory lenders out of business. We’re only asking them to be fair,” he said. “If they’re able to operate in Ohio and Colorado at one-third the interest rate that they’re operating under in Virginia, there’s no reason why they can’t change their rates.”

Advance spokesman Jamie Fulmer said by phone after the protest that states, rather than the company — which employs about 6,000 people nationally including 250 in Virginia — set APR’s. Fulmer said a better comparison than state-to-state rates is comparing the cost of a loan to a bank overdraft or late fees on a utility bill.

Fulmer said he believes the protesters are sincere, but said most Advance customers are satisfied with the company.

“What you see is that no two customers are the same,” he said. “We have some customers who use us once and we never see them again.”

Fulmer was also critical of a national Consumer Financial Protection Bureau regulation that was scheduled to take effect in August, but has been blocked by the Trump administration. The law would have required payday lenders to make sure borrowers could pay back loans while still covering their basic living expenses. Fulmer said it would’ve resulted in customers having to do an hour’s worth of paperwork and compared the requirements to taking out a mortgage.

However, Copenhaver said in an interview that it was an opportunity lost to reduce abuse.

“It was a good policy that was going to reduce people’s cycle of debt,” he said. “Eighty-percent of loans are to pay off predatory loans already.”

— Contact Evan Goodenow at egoodenow@winchesterstar.com

(11) comments


Once again Nanny Government to save the "victims" of their OWN debt. Maybe wrap it around the Fragile Earth Gang and you will get your way


Usury is immoral and in most states, illegal. Taking advantage of desperate people is wrong. A lot of these payday lenders prey on enlisted military members.

Admiral Emluk of Borbistan

To those with bad credit, a payday lender may be the only option for a loan. They provide a service. I think anyone interested in using them would know that the interest rates are extremely high.

John D Copenhaver

That is true, but some lenders charge a 3x higher rate in Virginia than they do in other states. They can still make a profit without gouging borrowers. But, it's the legislature's job to write laws to protect borrowers.


Most people who find it necessary to use these predators are living in poverty. Your car breaks down and you can’t get to work; your child gets sick and you need a doctor; you get a second job and you need extra child care. Don’t be so entitled Conservative, it isn’t as easy as your thoughtless words.


Conservative has no compassion/empathy for others. In Conservative's nasty world, the answer to most problems is "kill them" even children, born and unborn.


Correction...Kill illegal invaders, ALL of them, at the border. I'm against abortion. I just live in your brain everyday.[wink]


Entitled? HAHAHAHAHAHAHAHAHAHAHAHAHA! Thanks for the laugh. Payday loan rates are so high because of the RISK. If you start regulating their rates, they will disappear. No more payday loans. Then what will you be crying about? Stupid crybaby libtards.

John D Copenhaver

Advance America operates in CO and OH and the interest rate is 3X less


Then they can set up shop here as well. I don't see any reason they can't.


It's called living within your means. If you can't afford it, don't buy it. If you need the money, get a second job. Sheetz and McDonalds and Chick-fil-a are always hiring.

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