Kansas City, Mo. ? Chris Rose borrowed $500 from a payday lender when his wife was injured and lost her job.

Three years later, the father of two has paid $50,000 to $60,000 in interest on payday loans and still owes $20,000 to $30,000. The initial loan turned into about a dozen, causing him to lose the house he was renting to own and three cars.

Charities call his case extreme but touted it during a news conference Friday as an example of why lawmakers should pass legislation that would cap annual interest rates on payday loans at 36 percent and require lenders to do a better job of notifying borrowers about the terms of the loans.

“I don’t want to see this happen to any people in the future,” said Rose, who works at a Wal-Mart and a gas station and lives in charity-owned housing in the Kansas City suburb of Excelsior Springs. “It has destroyed us.”

The bill’s sponsor, Rep. John Burnett, D-Kansas City, representatives from the Catholic Charities of Kansas City-St. Joseph and Attorney General Jay Nixon sat near Rose as he told his story in the Cathedral of the Immaculate Conception.

“Predatory lending can become financial quicksand all too rapidly for people in dire straits,” said Nixon, whose office would be given more power to take legal action against payday lenders under the proposed legislation.

But Steven Schlein, spokesman for Community Financial Services Association, which is based in Alexandria, Va., said the 36 percent interest rate cap would essentially put the industry out of business because it would limit the amount of money lenders could charge on the traditionally two-week loans to $1.38 for each $100-amount borrowed.

“The interest rate charge is a red herring because any short-term credit product has a high APR,” said Schlein, whose organization includes 60 percent of payday lending companies. “Bank draft protection is 900 percent. Our customers are essentially trying to cover a check. They say they don’t want to bounce a check. They are trying to cover a car payment a rent payment or a utility payment, so they come to us.”

To be profitable, he said the industry needs to charge between $15 and $17 for every $100-amount borrowed.

Nixon said during the news conference that credit card companies seem to be faring well charging interest rates of half that.

He cited a Jan. 17 report from the Missouri Division of Finance that shows Missouri residents borrowed more than $787 million in just one year and paid an average annual percentage rate of 422 percent.

The report showed that the number of payday loans topped 2.8 million loans for the one-year period that ended Sept. 30. That’s an increase of 11 percent from the 2005 report.

Burnett said he has pursued payday loan legislation for four years but his efforts have resulted in just one committee hearing. He noted that several neighboring states have passed tougher laws limiting payday loans.

“We are the last state in this region to do that,” he said. “I am optimistic that we will make some progress this year.”