The Volokh Conspiracy - Montgomery County Anti-Predatory Lending Law Struck Down:

The Washington Times reports:

A Montgomery County judge yesterday struck down a predatory-lending law, saying it usurped state authority.

Circuit Court Judge Michael D. Mason said the law -- which cites "abusive prepayment penalties" and "excessive points and fees" as two indicators of discriminatory lending against protected classes of individuals -- is unconstitutionally broad.

"No matter how noble the purpose, a 'general' law is beyond the authority of the county to enact and is unconstitutional," he concluded in a 29-page opinion. "As drawn, it has substantial territorial effect beyond the borders of Montgomery County."

I haven't been able to locate the judge's actual opinion, so if someone has a link to it, I'd appreciate it if you would post it in the comments or email it to me and I'll post it as an update.

One issue that has arisen in the Watters v. Wachovia Bank preemption case, and which I addressed in my remarks at AEI the other day (video of the program is available here), is whether the OCC's preemption of state predatory lending laws is reasonable in light of the effect of such laws on the supply of credit to consumers. Apropos of that point, the story notes:

More than 50 local and national mortgage lenders -- including several Wall Street investment banks -- said the law made it too risky to do business in the county and withdrew their services in the weeks leading up to March 8, disrupting home sales and loan refinancings.

	[Todd Zywicki, December 1, 2006 at 10:12am] Trackbacks Montgomery County Anti-Predatory Lending Law Struck Down: The Washington Times reports: A Montgomery County judge yesterday struck down a predatory-lending law, saying it usurped state authority. Circuit Court Judge Michael D. Mason said the law -- which cites "abusive prepayment penalties" and "excessive points and fees" as two indicators of discriminatory lending against protected classes of individuals -- is unconstitutionally broad. "No matter how noble the purpose, a 'general' law is beyond the authority of the county to enact and is unconstitutional," he concluded in a 29-page opinion. "As drawn, it has substantial territorial effect beyond the borders of Montgomery County." I haven't been able to locate the judge's actual opinion, so if someone has a link to it, I'd appreciate it if you would post it in the comments or email it to me and I'll post it as an update. One issue that has arisen in the Watters v. Wachovia Bank preemption case, and which I addressed in my remarks at AEI the other day (video of the program is available here), is whether the OCC's preemption of state predatory lending laws is reasonable in light of the effect of such laws on the supply of credit to consumers. Apropos of that point, the story notes: More than 50 local and national mortgage lenders -- including several Wall Street investment banks -- said the law made it too risky to do business in the county and withdrew their services in the weeks leading up to March 8, disrupting home sales and loan refinancings.