Spring Valley pawn shop relieved as Illinois pawn bill stalls in Senate

A piece of Illinois legislation, which may have put a Spring Valley pawn shop out of business, according to its owner, did not pass as the General Assembly did not vote on it by the end of its lame duck session Tuesday.

The pause on the bill is a relief for pawn shop owners who say the proposed 36% annual interest rate caps would put them out of business. Owner of Illinois Valley Coin and Pawn in Spring Valley Chris Drewel said he’s glad the bills weren’t passed.

“We’re happy the bills did not come up for vote, but who knows, it could happen again in the spring session,” Drewel said. “Time will tell on that, but so far it’s business as usual.”

The bills would have included pawn shops in the Predatory Lending Prevention Act and limited how much interest and fees pawn shops can charge on loans.

Drewel said the caps would’ve been too low for him to successfully run his business. He also said pawn shops should not be included within the bill because they’re non recourse lenders, meaning the loan is secured by collateral in which the borrower is not liable.

Supporters, such as bill sponsor State Sen. Jacqueline Collins, D-Chicago, said the interest rates and fees pawn shops charge take advantage of consumers by overcharging them.

“Loans that charge 240% APR are a perfect example of an issue that is controversial only in the Capitol,” Collins said Wednesday in a statement reported by Stateline News in Rockford. “Ordinary people resoundingly support rate caps and oppose exceptions for pawnbrokers. (Tuesday) was a win for highly paid industry lobbyists and industry cronies – at the expense of consumers.”

Drewel said customers have shown concern about the legislation by stopping in and signing a petition at the shop’s counter. There is a chance the bills will be considered again at future sessions if the legislation is resubmitted for consideration.