CHICAGO (CBS) — Illinois Governor JB Pritzker signed a new law directed to protect consumers against high interest debt, reducing one kind of interest rate from 9% to 5%.
Called the Consumer Fairness Act, Pritzker said the new law will help families by lowering what’s called post-judgement interest rates on debt under $25,000.
“Consumer debt is at an all-time high all across the United States, and there are millions of people, including too many Illinois families, who are struggling under unconscionable circumstances,” said Pritzker. “Today, here in Illinois, we are giving real relief to those who are simply trying to pay off their debts, so they can end the cycle of debt they are trapped in.”
The new law takes effect January 1, 2020.
“Millions of Illinoisans struggle with consumer debt, and our laws have allowed far too many of them to get trapped in an endless cycle of collections,” said Rep. Will Guzzardi (D-39th.) “Today, we’re putting reasonable limits on debt collection to protect people from predation and help them get back on their feet. HB 88 is a significant reform for justice and fairness in our state, and I’m honored to have been a part of its passage.”
According to the Heartland Alliance, one in three people in Illinois are currently in the debt collection process. The new law also reduces the time frame to collect on a judgment from 26 to 17 years.