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Payday-lending studies can fit any argument

Think payday lenders are bad? One national study says that in states where lawmakers tinkered with regulations but did not significantly lower their interest rates, borrowers continued to get caught in a debt cycle, getting a new loan just to pay off an old one.

Think payday loans are necessary? A study published in November says that when payday lending was recently banned in Georgia and North Carolina, bounced-check fees and bankruptcies jumped.

"Basically, you have a study that says one thing and a study that says the complete opposite, so I guess it depends who you want to believe," said Rep. Dan Dodd, D-Hebron, a member of the House committee that will continue hearings in January on three plans to further regulate payday lending, which has grown from 107 Ohio stores in 1996 to about 1,600 today.

Two bills would significantly reduce the interest rate that payday lenders can charge on a typical two-week loan. A third bill, backed by the industry, would leave the interest rate alone but offer borrowers a one-time extended-payment option.

Rep. Christopher Widener, a Springfield Republican and chairman of the Financial Institutions Committee, went through a similar back-and-forth in early 2006, when consumer advocates and the mortgage industry debated a predatory-lending bill.