Gov. Mark Sanford signed into law Tuesday morning a bill to protect people borrowing money in South Carolina, especially low-income residents and senior citizens, from high-interest loans and unscrupulous lending practices. The predatory lending law is similar to North Carolina’s, which is considered a model nationwide.

One of the things the law prohibits is a practice called "flipping", which is when a mortgage lender refinances a loan repeatedly in order to generate money in points and fees. That strips the equity from homeowners and puts them deeper in debt, without any benefit.

That’s exactly what happened to Victoria Reed with her home in Columbia. "They called here. They told me that they could make my life better, wonderful, easier. Okay. What they did is they added $6,000 onto my mortgage and made my life much more difficult," she says.

The mortgage company told her she would be refinancing to a 15-year mortgage, shaving two years off her current loan, and her interest rate would be 6 ? percent. It wasn’t until she went to make the first payment that she found out that the mortgage was actually for 30 years at more than 11 percent interest. "Do I know anything about mortgages? Do I know anything about financing? No. Do I still know anything about them? No. But I know when I’ve been robbed. And yes, I was good and truly robbed on this," she says.

The new law puts new restrictions on high-interest loans, such as requiring consumers to get counseling on the loan. The lender must also believe, based on an objective standard, that the consumer has the ability to repay. And it prohibits balloon payments.

Sue Berkowitz, with the South Carolina Appleseed Legal Justice Center, has been working for years to get the law passed. "Well, most important, this provides protection to homeowners for the first time in South Carolina. When you had a first mortgage or bought a home there were no consumer laws that actually protected in lending practices," she says.

The law also puts new restrictions on car title lenders. Those loans can now be renewed no more than six times and interest must freeze after the sixth renewal. But those loans can still be at interest rates of 30 percent a month. "It certainly is not going to put the title lenders out of business, but at the same time it does limit how much they can charge, and they can’t keep building the interest into the renewal," says Sen. David Thomas, R-Greenville, the main sponsor of the bill.