Deseret News | Reader comments: Hill wants limits on payday loans

Reader comments
Hill wants limits on payday loans

Commoner | 2:19 p.m. Oct. 30, 2008

Once again Hill shows her ignorance of the duties of the office for which she is running. It is not the duty of the Attorney General to do anything about the payday industry.

If she wants to pass a new law, then she should run for the legislature.

If she doesn't even understand the duties of the office, why is she running for it?

What about Shurtleff? | 3:45 p.m. Oct. 30, 2008

I agree with Commoner, but it seems that Shurtleff is not much better if he's defending the industry. What can he really do about it anyway?

Changing anything with payday lenders would have to be done in the legislature. Last time I checked, the AG enforces the laws, not writes them.

wandrew | 7:51 p.m. Oct. 30, 2008

If you do not think the Attorney General's office is active in writing legislation to regulate various industries, it is YOU who do not know anything about the office. It is his privilege and his duty to suggest ways to make the law work better; and it is his inaction in this regard that gets all the payday lenders to send him large checks for his campaign. While Libertarians do not generally like regulation, I would not propose doing nothing if the industry truly is plundering people, which it appears it is. And I have already pledged not to seek another term if elected this time, so that such businesses would gain nothing by sending me large checks. It really is a shame the way things work. I do not suggest that Mark can be bought; but I do suggest that some people think he might be. If you do not see the connection, it is because you have not looked.
Andrew McCullough
Libertarian for AG

Comments continue below

Is hill still running | 10:09 p.m. Oct. 30, 2008

Didn't she see losing in latest poll 59 to 20?

Does she really think she can make up 39 pts in 4 days?

Not only that but she is contradicting herself again. She previously said in radio interview that she wanted to cap interest at 100%.

That didn't stick so now she's going to try again only lower at 36%.

And if that doesn't work, On Saturday she's going to force all payday lenders to make loans interest free.

And if that doesn't make up the deficit in the polls she's going to promise everyone free money at payday lending stores on Monday.

Surely promising free money to everyone ala Obama can win it for her.

Stewart | 11:06 p.m. Oct. 30, 2008

These loan sharks should be dealt with by the legislature. 36% should bed good enough. If that doesn't work there are always the pawn shops. The legislature needs to bring sanity back into this business by returning to the usury laws we had until the mid 70s. Easy credit turns these folks of limited economic ability into credit slaves. They use to put people in jail for charging rates that these payday lenders charge.

Legalized loan sharks | 4:56 a.m. Oct. 31, 2008

If these loan sharks operated on the streets they would be crimnals and thrown in jails. Just because they started using a building to operate out of does not change the fact that they are loan sharks, preying on the poor and ignorant. They used to hire their own thugs to collect the debts, now they use the police and our courts. Shurtleff is a beneficiary of these thugs so he is inclined to let them continue operating. He has made no attempts to change the laws or warn the public on how they operate. Shurtleff is a crook and incompetent AG and we can do without his corruption in SL County. What many don't know is that banks and other financial instutions are also in on this scam. They buy these loans from the loan sharks at these very high interest rates and banks have more clout when it comes to courts and legal actions to collect the 500% interest. The loan shark then becomes the collectors (3rd party) of payments that then go to the banks. A circle of deception and lies that is preying on the low income wage earners.

one of many | 8:32 a.m. Oct. 31, 2008

Stewart & Legalized loan sharks are the fortunate ones in this, I wonder how they would cap the NSF charges banks charge customers with no oversight, I have been in this industry for a while and I have seen the bank statements of our senior citizens who make a 30.00 error in their check book, with the way banks can manipulate clearing items a 30 dollar error cost someone 300 dollars in bank charges..I don't see anyone asking for APR on those fees? Nor do I see anyone calling them loan sharks yet a 30-40 fee on a charge of 3.53 is what when calculated as an APR. By the way each of you, if a stranger came in off the street and you were giving them 500.00 for 2 weeks what would you charge? This is a service not a conventional loan don't you all have more to do than continue to talk about an industry you know so little about.

Mistaken | 9:04 a.m. Oct. 31, 2008

RE: Legalized Loan Sharks. You have no idea what you're talking about. So if the rate is 36% then there is no PayDay Lending period. They go out of business. What you don't understand is that the Payday Lending companies are lending money to extremely high risk borrowers. It's not like they pay back their loans, that's the reason for the small claims court.

What is your solution if you're so smart? Send them to their bank and have them bounce checks? Did you know banks fees on bounced checks when caclucated as an interest rate is higher than 500% interest? Banks are just as bad if not WORSE than Payday lending companies. Why do you think people go to Payday Lending companies?????? Free market. They have no where else to go. Bank won't help them and they are even worse. No one is forcing a gun to these peoples heads and asking them to borrower money. They make the choice. Cap the rate to 36% or 100% and they all go out of business. If that makes you feel better great. But then the banks will then make all the money and we as consumers have less choices.

Who gives a hill? | 10:01 a.m. Oct. 31, 2008

Honestly.... If Hill understood anything about the extreme importance of the financial services industry within the state, she would see that a 36% APR rate cap would signal to all banks, credit unions, industrial banks, and credit card providers that Utah is unfriendly to financial institutions.

With all the charges that exceed an APR of 36% all of these institution assess, industrial banks and credit card providers would pack up and leave the state for Nevada, South Dakota, or Delaware.

Is Hill really ready to lose the state thousands of jobs because she thinks she's got Shurtleff on the payday issue? Not too smart Jean.

Zach Morris | 10:14 a.m. Oct. 31, 2008

36% interest on a two week $100.00 loan = .69 cents in fees. It would be impossible to run a business if that is all you are able to collect. Let me put this way: If you lent out $100,000.00 in loan principle and were only able to get back $692.30 a week in fees. (Assuming everyone pays you back) there is no way to cover payroll, leases, utilities etc. Would anyone lend out that kind of money if that was the return they were expecting? A cap is not the way to go. The free market can regulate itself. The more payday companies around the more they will be forced to lower their prices to entice customers to use their services. Those who cannot offer any lower fees than they are will close up shop soon enough.

unreal | 10:37 a.m. Oct. 31, 2008

Why would you ever want to limit ones options for credit with the current state of the economy. If you do not have a credit score of over 640 you will trouble getting a loan from a bank. These loans are a higher risk loan and have only become riskier due to recent events. So if you are having financial troubles and are in need of emergency cash and you try and limit the payday lender to 36% APR you will eliminate an industry that could make a difference in helping you with short-term financial difficulties. By the way what are your choices; the government, I dont know about you but I personally do not want the government in charge of my finances. but maybe if you are lucky someone in your family might want to give you a loan but depending on your family history they might even need to charge you more interest than a payday lender

Jeff Kursman | 11:53 a.m. Oct. 31, 2008

RE: Loan Shark:Compare the fees of consumersï¿½ short-term credit options: $100 payday advance = $20 fee; overdraft protection = $29; late fee on a credit card bill = $37; $100 off-shore internet payday loan = $25 fee; bounced check and NSF/ Merchant fee = $55. People want payday loans because they are less expensive and easier to get than other products for short-term needs.

IUHoosier59 | 11:53 a.m. Oct. 31, 2008

Here we go again...the government is going to step in and "protect" the consumer...just like it protected us against the legal thefts committed by Wall Street...certainly small potatos when compared to PayDay Loans. The typical PayDay Loan customer has no where else to turn...who is going to give him credit to help him out? Never ever have I been aware of any customer complaining about the APR on a PayDay Loan...typically they ask: "How much can I get and how long do I have to pay it back>? In Indiana, PayDay Loan offices are regulated by Department of Financial Institutions, the same regulatory body that oversees the banking industry...yet, one has to wonder why you never hear about a legislative effort to curb NSF fees...ever stop to figure the APR on overdraft fees...$30.00 charge for a $10.00 NSF check...and/or $6.00 daily fee charge when the account is overdrawn. If there were no need for PayDay Loans, then there would be no PayDay Loan offices...the industry only exists to serve the needs of its customers. Leave well enough alone and concentrate on the bigger picture at hand.

truthful | 3:31 p.m. Oct. 31, 2008

I'm with Shurtleff, I'm not poor nor am I uneducated. I have never felt targeted or trapped into a payday loan. I have utilized these services from time to time and yes they saved me! At what point do we let others dictate how we spend our hard earned money? If I obtain a loan, regardless of the type, I should have many options available to me as well as have the freedom to choose where I borrow money.

JR | 11:14 p.m. Oct. 31, 2008

Hill wants limits on payday loans and most of us want limits on politicians and government interference in our lives.

Over the Hill | 7:14 a.m. Nov. 1, 2008

I believe now is not the time to limit a consumer's right to borrow credit. I also believe now is not the time to have more government intervention. I also believe now is not the time to have Hill as our AG.

Payday Lending Rep | 1:46 p.m. Nov. 5, 2008

Hill is wrong on various counts regarding the payday loan industry. Her claim that these loans create a cycle of debt is invalid. Any customer who cannot repay their loan when due can opt to enter into an extended payment plan, allowing them to repay the loan over a period of additional weeks at no additional cost. A 36% APR translates into a fee of about $1.38 per $100 borrowed - hardly feasible for short-term lenders who have to cover business expenses like any other company. Hill's definition of payday lending customers is insulting to citizens and vastly incorrect. Research shows that payday advance customers are educated, hard working, middle class Americans who face unbudgeted expenses and want and need access to short-term credit. CFSA member lending agencies want to be a solution to this problem and are doing their part to ensure that this service is used responsibly by everyone.

Annual Percentage Rate | 4:05 p.m. Nov. 7, 2008

APR or Annual Percentage Rate is an amount a lender can collect if a loan was outstanding for an entire year. If the payday loan industry could loan money for an entire year and charge interest the entire time, they could probably afford to loan their money at 36% APR....

Anyone who has educated themselves on the already strict payday lending laws in Utah knows that they can only charge interest for 12 weeks.... and according to several studies the average customer pays their loan in 14 days.... NOT 365 days. An APR of 500% does not show literally what a person would pay for a payday loan since the borrower CANNOT have the loan out for an entire year!!!!

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