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Utah gets failing grade for loan protections

I would rather pay $10.00 to a payday lender for a $100.00 loan instead of bouncing a $100.00 check and pay my credit union $25.00 and the person I wrote the check to $20.00.

Where's the outrage and "report card" on bounced check fees?

Here is what I love about these non-profits, this Peterson woman, and this Hilton guy: They all can beat up on these lenders, but if they are correct, why don't they lend their own money to complete strangers at 18 or 36% annual interest for two weeks at a time?

It seems that they should be able to be the lowest price in town and out compete the guys they complaint about full time.

These consumer groups don't want these guys to go away, they need them around to complain about so they can continue to take taxpayer money in the form of grants to fund their pet projects and justify the existence of their sorry groups.

Call it what it is: a rip off of people in need. My state has really slapped it down, and one of our good little local banks has been caught supporting the business as a side business, in Florida of all places.

It is a rip off of those who are desperate. It is not a life preserver, it is a chunk of rock disguised as a "friend."

Something really unMormona about the business, eh.

In response to the negative press the bottom feeding "payday lenders" have been getting in the DNews, it looks like they have an organized counter offensive, Now when ever an article appears pointing out the exploitive nature of these loans, we get a barrage of bogus "citizen responses" pointing out abusive bank fees. Nice work guys.

Utah is notorious for no consumer protection laws. To much blame is placed on consumers for not reading all the extra fine print in contracts, if you have the opportunity to see one and read it before signing. Utah does not require that any credit or lending have a contract to read before signing. By merely applying for a loan or credit, an unread contract is established with no signatures. An application for credit or loan should not be used as both, a contract and an application. A lender can deny viewing a contract and Utah law makes assumption they are readily available. Now these loan sharks (payday lenders) work on the same principal. The high penalties and fees can be accumulated on a daily basis and turn that $10 cost to a $1000 in less than a month. This is predatory lending no matter how you justify using these loan sharks. This guy borrowing a $100 dollars to avoid an overdraft penalty is the one living in a dream world thinking he can beat the system. He better look out when he misses his first repayment to them by one day. Now lets see who has the last laugh.

You quoted the commercial perfectly.
These places are a rip off. Read the article people. All they want is a CAP of interest they are allowed to charge...regulate it. Not to get rid of them all together. These places are a blight and tacky from the road anyway. Close them all down.

Why would the director(Linda Hilton)of the Coalition of Religious Communites be qualified to tell payday lenders what to charge on a loan? Where did she come up the 100% APR? She has no idea what it takes to run a successful business.

Does any one understand what these companies charge? When I borrow from a payday lender my loan is only for a week not a full year. I agree the APR appears to be high, but my loan is paid off in one week. The loans never go out a full year. In fact, if I'm in a bind and I am unable to pay off my loan in a week, I have the option to get a no interest payment plan. How many banks or credit card companies offer that? The reason I choose to take out loans with a payday lender is it is cheaper than bouncing checks.

It is rediculous to call a bounced check fee a bogus bank fee. If you can't balance your checkbook and keep enough money in your account to cover your expenses it is your own fault and you deserve the bank fee. By bouncing a check you are creating more work for the bank. You must do this often if you are upset about it and may need to consider a cash only system to manage your money. These payday loans are rip offs and there need to be laws to regulate them.

APR stands for Annual Percentage Rate for those of you who are unsure. An Annual Percentage Rate is a dollar amount that a business can make by lending money over an entire year.

The Department of Financial Institutions (DFI) is a regulatory body responsible for ensuring that the payday loan industry is following the many state regulations in place to ensure the consumer is protected and aware of their borrowing options. One of the state laws limits the interest charged by a payday lender at 12 weeks. A consumer will never pay more than 12 weeks of interest on a short-term payday loan, so the APR would never be met.

Why does Linda Hilton believe that a 100% APR would be beneficial? Is she a business owner providing a needed service? Where did this number come from... out of thin air? These payday loan adversaries need to keep the regulation up to the DFI, the business decisions up to the business owners, and the right to make personal financial decisions up to the consumer!

Why are we wasting time trying to regulate payday lenders? Obviously consumers choose to go there because they provide a needed service. More restrictions would only limit choices for consumers. Let the consumer decide if these lenders should stay in business. Shouldn't people have the right and freedom to choose for themselves?

This report is ridiculous. Capping fees is short sighted and demonstrates a complete lack of understanding on how the economy works. What is the ultimate goal? Reduce the number of lenders? Push the market underground? How does that help?

The entire concept of consumer protection is amusing. Let the market work - its better then the alternative.

It is noone`s "obligation" to loan ANYone money. It is noone`s actual "responsibility" to assist ANYone out of a hard time. When some among us come upon "hard times" or have unexpected emegencies it actually is up to the best instincts within us to help those in need or to have seen to it that programs get established within our communities to assist legitimate need (NOT those who have pushed family aside, turned their backs on the faith community, squandered their money, etc). There is an obligation in life to do all we can to be careful about our spending, honor relationships, etc. If we "need" after fulfilling our obligations, there ARE places and people who will help. Problem IS... some want to live however they wish, expect someone "out there" to help them and dictate the terms......bologna!

He defended the institutions he is supposed to be investingating. Which side of the law is he on?

In states where these organizations are regulated, they go away.

Here in Utah, they have been protected, and have thrived in our downturned economy.

They like it here and will fight tooth and nail to stay here. They get huge influxes of cash from hurting our people and economy.

Regulate them, and they have to compete with regulated banks, and they go away. They don't exist where there is regulation.

It is sad to see the Allred guy who is in charg of investingating these organizations defending them. I have heard him speak before, and he has openly stated that there needs to be high levels of regulations of these organizations. He statate all the problems that he has run into dealing with them as unregulated organizations.

As far as not regulating them because of a free market economy, that is bunk. There needs to be boundaries for any economy to thrive. That is the problem with these companies. They hurt the economy and create bankruptcies and other problems.

Regulation is the answer. Create boundaries for them, and they will go away.

As long as we have politicians involved in it as owners and or recepients of campaign donations, nothing will change. One of their greatest supporters is the state attorney general, so how are Utahns going to get any relief from the Tony Sopranos in our mist.

Utah regulates everything else, why not this area. These loans to the naive and weak cause a lot of strife in society. True old fashioned pawn shops charge 120% interest. That is all that is needed for quick cash.

So preying upon the poor and desperate is OK in Utah, if you want to marry your same-sex partner, you're destroying civilization?

Another article bashing Payday Lending. It's getting old now. Funny how markets work. Where there is demand then suppliers come in. If people didn't want short term loan, then suppliers wouldn't offer them and get into another line of business. But there IS a market for 500% loans. People are not all stupid. It's not hard to figure out that if I borrower $100 I have to pay the company lending me money a dang good rate since I have sucky credit, no cash, and a low income job. It's better than getting kicked out of the apartment I rent for late payment.

Basically this is just supply and demand. If all you liberal nut jobs are so outraged then go start Payday loan companies that charge 36% or 100% and we'll see how long you're in business. Do you know the deliquency rate on these things??? They have to charge a lot of interest to cover their losses and make a profit.

Demand = Supply

Payday lending in Utah is regulated. There are very few complaints from the people who actually use it. What's the problem?

Not only that but the interest charged is capped at 10 or 12 weeks (Yep, that's part of the regulation in Utah that is ignored when reported and when out of state institutions give Utah a low grade)

The user of the service doesn't have to pay more than 10 or 12 weeks of interest. I don't understand how opponents can point to an Annual Percentage Rate when the loan becomes interest free after 10 or 12 weeks.

In reality the APR is about 1/4th of what is reported if the user enters into an interest free repayment plan after 10 or 12 weeks and keeps the loan for a year.