In 1999, a catholic priest in Chicago found himself counseling a parishioner who was struggling to stay afloat financially. The parishioner, a mother who worked two jobs, had been paying $120 every two weeks for over a year to service two payday loans. The priest was shocked to learn that the original principal of the loans was only $600. In repayment of that $600, this woman had paid out over $2,000—over 500 percent in annual interest—and was still paying.
The priest, Monsignor John Egan, helped his parishioner pay off the loans and the interest—and then helped catalyze a community-wide effort to fight unscrupulous and predatory lending. After his death in 2001, the coalition he assembled named itself the Monsignor John Egan Campaign for Payday Loan Reform and became one of the country’s first faith-based coalitions to combat predatory payday lending. Since then, faith leaders have gathered in nearly every...
