Payday loans are one step closer to becoming legal in North Carolina. A bill filed in the Senate last week could go up for a vote as early as Tuesday or later this week.
Eyewitness News spoke to the legislator behind the bill and found out why he thinks people in financial crisis need a second chance.
Sen. Jerry Tillman (R-Archdale) said he filed the bill after several of his constituents told him they needed a loan but had no way to get it.
Payday loans were banned from the state 12 years ago. Nancy Mersereau said there's a need for it.
"My sister at this point in time is facing debt, you know, with credit cards. She's realized how easy it is to get in debt," she said.
Merserau said she'd support payday loans if strict limits were made.
Sen. Tillman said that's what his bill will do.
"In the end, it will keep jobs for people that get in a bind from time to time. Good people get in a bind every now and then," said Tillman.
The bill would allow consumers to take out a loan up to $500. They would have 35 days to pay it back and could be charged as much as 15 percent in interest. It would also require people to pay off the loans before taking out another one.
"It's predatory. It takes advantage of people who can afford it the least," said Tom Bartholomy, president of the Charlotte Better Business Bureau.
The BBB warns there's no way to verify if the borrower has another outstanding loan.
Tillman said that's the lender’s job. He's also proposed a monitoring system to keep someone from going to one lender to pay off another.
"If you don't pay it back one time, you're out. No second chances, none of that. No rollovers," said Tillman.
Bartholomy said the average time it takes for someone to pay back a payday loan is eight months.
If approved, the bill could go into effect as early as July 1.