Judge's Ruling Could Eventually Change Alabama's Title Loan Rates

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MONTGOMERY, Ala. (AP) - Lawyers say a circuit court judge's
finding that a part of the Alabama Pawn Shop Act is unconstitutional could lead to major changes in the way title loan companies charge interest in the state.

Saint Clair County Circuit Judge Charles Robinson senior struck down a provision of the 1975 act after finding it violates the Equal Protection Clause of the 14th Amendment of the Constitution by allowing title loan companies to charge as much as 300 percent interest while restricting other lenders to a 24 percent maximum annually. Robinson's finding is in an August 25th summary court ruling.

James Waites filed suit against Express Enterprise, Incorporated in February 2003 after he paid 900 dollars on a 400-dollar title loan he took in order to buy medicine for his wife.

His truck was repossessed after he made nine consecutive 100 dollar payments, which the company said only went toward interest on the loan.

Waites' attorney Annesley DeGaris says the ruling is a victory for working families.

DeGaris says he expects attorneys for Express Enterprise to appeal the ruling, which would send the case to the Alabama Supreme Court.

Attorneys for Express Enterprise could not be reached for comment Thursday.

(Copyright 2006 by The Associated Press. All Rights Reserved.)