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Religious coalition says unfair short-term lending can hurt consumers

Published: Wednesday, June 30 2010 12:00 a.m. MDT

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If credit unions are offering payday loans, shame on them. Why can't we have usury laws back?

SJ Bobkins

If you disapprove of the money first before social responsibility way of doing business, you first need to push the legislature to pass the consumer protection laws to force banks and credit unions to play "nice". Utah has the least consumer friendly "folks on the hill" of any state in the nation. They sold their collective soul long again to rid the books of usury laws under the premise that doing so would bring in regional credit card processing centers with lots of slightly above minimum wage jobs. Find out who pays for the campaigns of legislators and who they work for, before voting. Most states have made it very hard for payday and mini loan strip mall lenders to operate, but Utah, well forget it. You deserve who you vote for and Utah has so much to be embarrassed about. The protestors have no effect because these people will do anything for more money. Sex and money corrupt anyone and everyone, just recall the scandals of so many politicians and religious figures. Without laws, anything goes.


So why are they targeting the Credit Unions and not the PayDay lenders? This group seems to be a bunch of employees of Payday lenders fearing losing their jobs or people with outstanding loans with the PayDay loan sharks. A little kickback credit on loans with them?

At least banks and credit unions have some regulatory controls on doing business. Has this group lost touch with reality and who the real criminals in short term lending is? They should be marching on the Pay Day lenders stores who are their enemy of the group. Or even the legislators to shut down all lending of this type as predatory. That's why loan sharking is illegal, its predatory just as all payday lenders are. How ever, the credit unions are under state and federal regulations and the pay day lenders have no restrictions or regulations on them.

Credit Unions are taking business away from the sharks and this looks like willful attack by these sharks to draw attention to their competition in a multibillion dollar predatory industry in Utah.


May I make the respectfully suggestion that the members of CORC mind their own business concerning Credit Unions. In other words, mind your own business on everything.


"I thought credit unions were so you'd have fair stuff for people, both sides," said Dorothy Talbert.
Perhaps Ms. Talbert and Esquire can start their own credit union and show everyone how its done. They can be "fair and just", of course then they would have to take the risk of losing their money. Much easier to snipe with no skin in the game.


I don't think the loans are as much the problem with the terms. They really should bring back usary laws.


Isn't this the capitalism people keep talking about? If you don't have the personal responibility to NOT take such a loan - which I'm sure shows you the interest rate at which you'll pay it back - then that's your problem, not the bank's or the credit union's. If there's no demand for these loans, they will go away.


Fortunately I havent had to use these loans but for those that do, it can be a lifesaver. I dont blame the credit unions as they are providing a service that is needed. The key is to use it responsibly and that goes back to the individual and the need for education on financial matters. I have found credit unions to be very fair. For this type of loan they do have to charge enough interest to cover their losses in case other people dont re-pay their loans. Simple solution is that if you dont like the loan terms then dont use the loan.

Florien Wineriter

In paragraph five Humanism should be capitalized as are all the other religious philosophies.Florien Wineriter,past president, Humanists of Utah.


No bank or credit union is in the business of losing money. The high interest rates are necessary to cover the losses that they will be taking because of the higher defaults on these types of loans. After this criticism, if I was running a credit union, I would just stop lending to anyone that didn't have the credit to get a normal loan. They get poked in the eye for trying to help people who have completely ruined their credit. The critics should get a life and find a way to help these people instead of trying to cut off all credit to them.


Oh leave those little ol' credit unions alone. After all, as Anatole France so wisely reminded us: "The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread."


So, Rebecca Palmer, perhaps you could have included in your article what the loss experience for the CU's is on these types of loans. How many of these loans end up being charged off? What is the cost to the CU (to process just one loan)? How many must be repeatedly extended? How does the CU loan compare to the Payday loan?

Maybe this group should also protest the price of tickets to a Jazz game.

Danish American

Simple solution. Don't get the loans. Perhaps Rebecca could offer a better deal. I know I don't want my money loaned to poor risks.


If a high number of these loans are being written off they should not offer them.


I share the concerns of the CORC over the high cost of payday loan products. I recognize the damaging effect that payday loans have on an individual’s finances. Credit unions initiated these programs specifically to help consumers move away from payday lending. Unlike “payday lenders,” I don’t let members get caught in a cycle of larger and larger short-term loans. Instead, I work closely with members to pay off the debt over time. The huge difference between my work as a credit union employee and typical “payday lenders” is that I strive to help members through short-term crisis, and I help provide a path back to access to conventional credit sources. I offer members alternatives, such as financial counseling or less expensive products. CU payday loan alternatives are considerably less expensive than traditional payday loans -- a fact that cannot be so easily dismissed. Alternative products are exactly that--alternatives to payday loans. No one is saying these are perfect loans, but by definition higher risk means higher cost. I do not accept the implied notion that people who are in short-term financial difficulty should simply be shut out of access to credit.

Last Stand

I despise the payday loan stores and their predatory practices but as long as their is demand for those type of products, there will be supply. The entitlement complex in our society beguiles us into believing we have a right to borrow on credit. As soon as financial responsibility is understood by all, then demand for these products will cease.


I'm sure these people mean well but a red flag goes up for me when I hear the term "social justice". It is code for socialism/communism for the far left. If church groups are trying to help the poor with there own money that's great but if part of their agenda is to get the government to even the playing field at the expense tax payers then they are moving to socialism, which leads to communism. The far left is making a huge effort to infiltrate churches to accomplish their goals.
Remember: social justice-bad, equal justice-good!


Why are banks not doing this? Aren't they the big bad guys? Let's face it, the CU's are in dire need to make money to offset bad loan portfolios. Of course they hide their problems by "merging" problem CU's with big CU's (see So. Ut Fed CU)rather than failing. They never write off bad loans banking on the market coming back to maintain their fragile reputation for soundness. For the sake of us all I hope it works out because we don't need another S&L crisis.

Of course, Banks too have considered these loans but most did not want the reputational risk. I say CU payday loans are fine. For once, even if for the wrong reason, the CU's are serving the underserved.


Religious groups should stick to what they do well: descriminating against people who are different than themselves, putting down other religions, and starting wars.


This is a 'free market' solution as defined by the conservatives in this state. Yet a conservative, religious group, is protesting it. Interesting. If there is demand for something, supply is provided, and the only way to stop such supply is...gasp...BIG GOVERNMENT INTERVENTION! REGULATION! Guess that means these loans won't be going away anytime soon.

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