.

Google+ Followers

Followers

Wednesday, June 16, 2010

What's Wrong With Pay Day Loans?

 Congress is  finalizes language in a  massive financial overhaul bill, in which  lawmakers will be debating whether and how to regulate payday loan stores....Some critics say that predatory lenders  take advantage of desperate people...Some say the stores offer a service that helps people get through short-term financial emergencies.Question: What's your opinion on payday loans? From what I have read about pay day lending I don't see them as being a big problem....I would like to know why congress is so interested in payday loans instead of banks overdraft  fees? An overdraft courtesy is not a courtesy but an automatic loan....Overdraft fees are highway robbery....With payday loans you know what you are getting...The real crooks  in this business is/are the banks.
Please Share it! :)

Widgets

Show Comments: OR

6 comments :

  1. Pay day loans are way worse than any overdraft fee. The interest rates are from 300% to over 1000%. Many people do not know about these fees because they are written in such a way that the true fee cost are hidden. They aren't anything but legalized loan sharks. A study was done on them a couple years ago and it was stated that because of the interest rates, people could not get free of these loans. They are creating more poverty and suffering for people.They should have been regulated a long time ago. I haven't used one and never well.

    ReplyDelete
  2. Congress actually did get after banks about overdraft fees. It's included in the credit card reform legislation that passed recently.

    Payday loans are bad for all the reasons Nikki said. Also you have to consider WHO uses payday loans. Usually people who are living check to check anyway and they end up in a really bad cycle of always needing a payday loan (because your next check goes almost completely to the payday folks).

    Yes, it's nice to have those quick small loans available but they have got to stop taking advantaged of lower-income people

    ReplyDelete
  3. @Nikki thanks for your comment...From my research a typical pay day loan is far less expensive than a bounced check or checks fee, utility late fee or a cut off notice.

    Think about this Nikki assume you have a $100 water bill...You paid it 1 day late incurring a 10% late charge = $10. Let's say the check bounced so you got overdraft fees= $35.

    Now let's say the pay day loan charges 1.70 on a hundred for each day until your next pay day...I believe you will discover that the pay day loan fees are better for someone that's in a tight than the bank or utility company.

    @A.Smith thanks for your comment..."taking advantaged of lower-income people" I agree and understand what you're saying...But most of the people who borrow from pay day loans already live on a tight budget...So if/when some thing unexpected happens it can derail them.

    ReplyDelete
  4. Hey jjbrock, luv your website.....really with payday loans it becomes a cycle...that's the problem....as previously stated, these ppl are usually already living from paycheck to paycheck and whatever the cost may be, they are offered a rollover to alleviate the stress of paying the loan back in full which incurs more fees which really gets them back to where they were before they needed the money.....these lenders know what they are doing and yes the interest rates are sky high! Usually since the person is living from paycheck to paycheck they go back and can't afford to pay it off and they just keep going back hoping to find money from somewhere to pay it...I rather have an overdraft fee then a payday loan....the higher the amount...the higher the interest rate, with overdraft fees it's usually one set amount.

    ReplyDelete
  5. @Nikki thanks for your comment...From my research a typical pay day loan is far less expensive than a bounced check or checks fee, utility late fee or a cut off notice.

    Think about this Nikki assume you have a $100 water bill...You paid it 1 day late incurring a 10% late charge = $10. Let's say the check bounced so you got overdraft fees= $35.

    Now let's say the pay day loan charges 1.70 on a hundred for each day until your next pay day...I believe you will discover that the pay day loan fees are better for someone that's in a tight than the bank or utility company.

    @A.Smith thanks for your comment..."taking advantaged of lower-income people" I agree and understand what you're saying...But most of the people who borrow from pay day loans already live on a tight budget...So if/when some thing unexpected happens it can derail them.

    ReplyDelete
  6. I need to limn on Rental Assistance In Chicago Instant Online Loan Approval No Credit Check Payday Loan ..
    cash advance chicago

    ReplyDelete