Reader comments
Payday lending problematic

The Bible considers usury to be a grave sin, yet usury laws were repealed by the Utah legislature. If religious values are not applicable to our laws, why pass laws restricting gay marriage, alcohol consumption, pornography, etc.? Who decides which religious teachings are codified into law, and which can be ignored with impunity?

Law is only justified to rectify wrongdoings. If a man infringes on your life, liberty or property, then he has committed an offense against law/liberty. Otherwise, leave him alone. It's best all around that way. Else, when your favorite team isn't controlling things, you'll be the persecuted one.

"Rightful liberty is unobstructed action according to our will within limits drawn around us by the equal rights of others. I do not add 'within the limits of the law' because law is often but the tyrant's will, and always so when it violates the rights of the individual." Thomas Jefferson

The bible is clear: Usury is any interest or fee over 0%. Once a country decides to let any interest be charged the next logical question is, "How do we make sure the fee is the lowest possible for the consumer?" The 36% rate cap is completely arbitrary. There may be some historical evidence of people having a rate of 36% but there is also evidence of cultures and governments having 12%, 8%, 6% and 0%. So why 36%? Why not 35%? Why not 37%? What makes 36% so special? This U "expert" gave the answer in his debate on Monday night. He admitted that a 36% interest rate is so low that it would put payday lenders out of business just as it has done in other states that have adopted it (interesting that didn't get mentioned in this editorial.) The 36% rate cap would give consumers less financial choices when they are in a pinch and in need a little extra cash. The best and most efficient way to make sure the cost of the loan is as low as possible is to allow the free market and the natural forces of supply, demand, and competition to work.

Seeing the housing market collapse, subprime loans dragging our economy down and an insurance industry who failed their customers in New Orleans: trusting corporations to self regulate is like letting a ten year old watch over a house full of teens while their parents are away. You you think our ancestors were stupid? There are reasons they started regulating business in the first place. Next, we will relearn why they outlawed gambling.

This is an article that borders on ridiculous. They seem to call for state regulation, then point out that competition's already working. Having worked with payday loan companies and seen their numbers, you'd be shocked at the rate people miss payments. It's a risky business to be in, and people have to pay to compensate for that risk. Regulate it too much and you'll find that the availability of the loans goes down.

A lot of room between a 36% and a 900% loan? Yes indeed. However, the one thing the Opinion fails to consider is the cost of the product. As was posed at the debate, if so many companies in Utah are offering these loans, why isn't someone willing to offer them at rates closer to 36%? The answer is, as was conceded by both sides of the debate, that the loans simply cost too much for the industry to survive at such low rates. At 36%, a lender would earn only $0.69 in interest on a one week $100 loan. That amount of interest would not pay the light bill, not to mention salaries, insurance, rent, taxes, supplies and all other costs of doing business. The real problem here is the fact that this is a "fee" business being forced to disclose a 2 week loan fee as an annual percentage rate under federal law. If bounced check fees, check protection fees, ATM fees, and late fees had to be disclosed as an APR under the law, everyone would be going NUTS. These customers are smarter than socialists give them credit for. Let's give the borrowers a little "credit."

I have a friend who works at the Deseret News who said the Editorial Board won't even meet with the payday industry. I guess the saying "there is two sides to every story" doesn't hold weight with the editorial board. You can see that with the one-sided slant on this issue.
I for one would welcome any company, credit union, or individual would would offer a two week loan at 36% APR (without government subsidies). Guess what? It won't happen. Because any organization that offered such loans would be out of money and out of business!

When I got divorced, I decided to give my ex-wife my beloved truck, even though I had no need to. It wasn't six months later, she obtained an $800 loan using that $10,000 truck as collateral. Every month she paid $250 on that truck loan, which only covered the interest. Finally, after six months she cried uncle and asked me for help. It cost me $1100 to satisfy the pay-off.

In my youth, we called these people "Loan Sharks" and they were believed to be connected to organize crime.

Tony Soprano would be proud.

"I've Seen it" Those people you call loan sharks are Title Lenders, not payday lenders. Stay on subject here!

Payday Lenders are Loansharks. I was once in this trap myself. There is no way they can justify this kind of usuary. I can understand needing to make some profit but 400 to 1000 percent??? Dosent sound right to me. I found a website called paydayloanavengers that really helped me to contact the right authorities and get out of this mess.