Does California Have Predatory Lending Laws?

Governor Newsom Signs Legislation to Fight Predatory Lending in California. SACRAMENTO — Governor Gavin Newsom today signed into law a measure protecting consumers from predatory lending practices that create “debt traps” for families already struggling financially.

What qualifies as predatory lending?

Predatory lending is any lending practice that imposes unfair and abusive loan terms on borrowers, including high interest rates, high fees, and terms that strip the borrower of equity.

Is predatory lending a crime?

Simply put, predatory lending becomes a crime in California when the lender manages the loan transaction to extract the maximum value for itself without regard for the borrower's ability to repay the loan.