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Payday lenders fighting plan to cap interest at 100%
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Jake | 1:30 a.m. Feb. 15, 2009
These guys are predators and need to be driven off the landscape. The totally
unmitigated free market leads to this kind of abuse and is entirely counter to
the good of the people. The entrenched ideology of an entirely free market
regulating itself is nothing short of wishful thinking, and is a myth.
torquefire | 2:45 a.m. Feb. 15, 2009
Free market is one thing, this is another. These types of businesses take
advantage of people when they are in desperate situations. They are scam artists
and criminals just like a loan shark. Why do you think so many other states have
banned them?
Comments continue below
THEeyepatch | 2:52 a.m. Feb. 15, 2009
Control!
Anonymous | 3:49 a.m. Feb. 15, 2009
I agree that these businesses are risky, but they do have their place as a VERY
LAST RESORT if you know what you are doing and shop for the best of the worst.
I have to admit that I have used these plaaces, but borrowed only what I NEEDED
and KNOW I can pay them back on time by simply letting them send my pre dated
check through my bank when I agreed to let them do it. By disaplining myself I
have had no trouble and have even raised my credit score by doing so. The trick
is to borrow only what is needed and them remember that that is money you have
already spent from other sorces that is coming to you later because you needed
it now.
mike | 4:10 a.m. Feb. 15, 2009
In Australia the limit is 48% p.a.
That's still too much in my book.
Should be more like 24%.
All loans have their costs added to the principal or paid up front. Lenders don't have to cover them from the interest. There are other ways.
Islamic pasyday lenders charge an agreed fee for the loan. No interest is charged.
The toruble with short term lenders is that they treat the borrower as if they are a captive market - which is pretty much true.
The trouble with short-term borrowers is that they are vulnerable and will accept almost any terms because they have to.
A cap is a good thing. 48% is workable, so is 25%
That's still too much in my book.
Should be more like 24%.
All loans have their costs added to the principal or paid up front. Lenders don't have to cover them from the interest. There are other ways.
Islamic pasyday lenders charge an agreed fee for the loan. No interest is charged.
The toruble with short term lenders is that they treat the borrower as if they are a captive market - which is pretty much true.
The trouble with short-term borrowers is that they are vulnerable and will accept almost any terms because they have to.
A cap is a good thing. 48% is workable, so is 25%
Andy | 5:18 a.m. Feb. 15, 2009
Way to go Laura! We need control.Our kids live on it week to week.
Loan sharks in disguise | 5:32 a.m. Feb. 15, 2009
The only thing that makes this business legal is that they bought a license to
practice loan sharking. With this license they now use law enforcement to be
their enforcers to collect debts. This cap of 100% is not low enough. They are
predators of the poor and marginal income workers and many military personnel.
What is most disturbing is payday lenders sell these loans to local banks who
then become the predators with the greater ability to clog our small claims
courts. Perhaps some legislation to keep lending institutions from using small
claims courts to act as collection agencies on their loans. Better yet,
legislation to ban them from the state. It would also free up law enforcement
and keep them from being the enforcers for loan sharks. These business are not a
part of the free market system, they are predators with no purpose. They are in
business to steal and rob from the poor. Even our esteemed County AG, Shurtleff
is on their payroll and openly considers them as reputable. Shurtleff has been a
clog in the artery in tring to eliminate this scourge of loan sharking.
another approach | 5:37 a.m. Feb. 15, 2009
Make it illegal for these (ahem) businesses to loan money to anyone under 30
years old. If people aren't responsible enough to stay away from them by
that age they deserve what they get. I'm betting the "lenders"
would fight that, too.
Anonymous | 5:59 a.m. Feb. 15, 2009
Desperate people do desperate things, which many times are fool hardy. These
types of lending institutions wreck tremendous personal damage. My son was
involved with two a couple of years ago. They have been disastrous for him.
These charlatins should be outlawed.
Boudreaux | 6:05 a.m. Feb. 15, 2009
Here's the real problem:
"Such power comes as the industry gave at least $91,000 to state candidates and parties last year � including giving directly to about one of every four legislators who stood for election."
The industry has bought out your legislature. This is where the controls should be. Cut off the head of the legislative snake and problem solved.
Too many people drinking the legislative Kool Aid.
"Such power comes as the industry gave at least $91,000 to state candidates and parties last year � including giving directly to about one of every four legislators who stood for election."
The industry has bought out your legislature. This is where the controls should be. Cut off the head of the legislative snake and problem solved.
Too many people drinking the legislative Kool Aid.
Daddy Dave | 6:08 a.m. Feb. 15, 2009
These are indeed 'predatory lenders' in the worst sense of the word.
The prey on desperate, financially ignorant people and trap them into a
'lending' cycle they can't get out of. Many of their
'customers' sign over their entire paychecks to these animals, and
then 'borrow' what they need to survive on. If there was any justice
in this country they would not be allowed to operate at all. These businesses
are nothing more then 'dressed up' versions of the 'loan
sharks' that used to operate in poor neighborhoods, and broke the legs of
'customers' who failed to meet their 'payments'. OUTLAW
THEM!
It's Business | 6:25 a.m. Feb. 15, 2009
I don't hear of anyone being dragged in off the street and made to apply
for a loan. This is just one more effort to protect people from the consequences
of their own actions. It's a tax PAYING business.
Do Gooders | 6:57 a.m. Feb. 15, 2009
How many of you would loan 100 dollars to a complete stranger and only want 3.95
for taking responsiblity for taking care of their collateral and doing the paper
work for the state and city. I'm not in the business but am just being the
"devils advocat".
liberal larry | 7:02 a.m. Feb. 15, 2009
Even though we advocate "free market" principles, in Utah, we also
have no trouble banning practices which have shown to be generally very bad for
people. That's why we wisely have banned, gambling, drug use,
prostitution, Ponsi schemes , etc. I've seen how these bottom feeding loan
sharks take advantage of those in need, I think they should be banned out right.
Remember this:
"The rich rule over the poor, and the borrower is slave to the lender." (Proverbs 22:7)
"The rich rule over the poor, and the borrower is slave to the lender." (Proverbs 22:7)
Joseph | 7:43 a.m. Feb. 15, 2009
Congratulations, Laura Black. But please be tougher, work to ban them from the
State. Those loan sharks are preying on the misery of troubled people. At the
same time, though, provide to these troubled people more financial education and
help so they can better handle their challenges.
Get rid of payday lenders | 8:12 a.m. Feb. 15, 2009
I find it very hard to believe that payday lenders can't make it on 100%
interest. I think that they should leave the state. We don't need this
type of business here.
Rick | 8:25 a.m. Feb. 15, 2009
I trust that the limit of 100% will also be applied to bank fees that often
exceed 1,000%.
Zadruga Guy | 8:38 a.m. Feb. 15, 2009
No one is holding a gun to the heads of the people taking the loans, forcing
them to do so. Sure, the government should protect people from being deceived,
by requiring full disclosure of the contract terms, but if the terms are
accurately described in the contract (and I have not heard anyone claiming
otherwise) then no deception is taking place. If a business offers a loan at an
interest rate of 10,000% and there are people out there who voluntarily agree to
those terms, then what right does the government have to say that the deal
should not be allowed? If a person finds that rate to be too high, then he or
she can pursue other options or try to negotiate a lower rate with the business
offering the loan.
If the government artifically limits the loan rates that can be offered, then the businesses will refuse to make loans to people with very bad credit. That will result in a person with only bad loan options suddenly finding that he or she now has no loan options. So in the end, limiting rates doesn't help those whom the program is supposed to help.
If the government artifically limits the loan rates that can be offered, then the businesses will refuse to make loans to people with very bad credit. That will result in a person with only bad loan options suddenly finding that he or she now has no loan options. So in the end, limiting rates doesn't help those whom the program is supposed to help.
joe lender | 8:41 a.m. Feb. 15, 2009
Why are we not banning McDonalds or Burger King for tempting the obese. Why
don't we put speed controls on cars to cap the speed at 65 for those who
have a lead foot. How about banning Credit Cards or Land Speculators for the
mess we currently experience. Why don't we just let Government rule
everything we do. that would mean higher taxes, more regulations, fewer
choices. These businesses provide better rates than your bank when you bounce a
check by mis balancing your bank account by $1.00. Or when you are late on
either a car payment or a home loan. Maybe we should all file for bk life is
too tough.
Ted | 8:48 a.m. Feb. 15, 2009
These "businesses" are a plague that should be eliminated from
society. They mercilessly prey on those who can least afford their
"services". Cap the amount they can charge or do whatever else is
necessary to drive them out.
evensteven | 9:00 a.m. Feb. 15, 2009
The whole subprime mess is a result of lenders lending and borrowers borrowing
more than they could repay, with insufficient collateral. The country is now up
in arms over the resulting foreclosures (currently banned by Obama). Isn't
that the free market at work? What is the difference between predatory subprime
lending and predatory payday loan lending? I see none. Generally, I am no fan
of the Dem agenda but they have my support on this.
dj | 9:20 a.m. Feb. 15, 2009
Excellent argument Liberal Larry, well said.
Brett | 9:22 a.m. Feb. 15, 2009
Listen to this scare tatic:
"What will they do? Bounce checks? That costs $35," which is more than payday loans that are paid on time, she said. She added they might go to shady Internet loans, or let emergencies go unmet "and some of them could lose their homes" by not paying mortgages on time."
Yes, or they could just live within their means like everybody (except the gov't) does).
This is a bill that will benefit the working class from these consciousless predators. I hope it passes. Too bad many of the same politicians who grandstand everyday as "moral crusaders" are on the payrolls of these moneylenders.
"What will they do? Bounce checks? That costs $35," which is more than payday loans that are paid on time, she said. She added they might go to shady Internet loans, or let emergencies go unmet "and some of them could lose their homes" by not paying mortgages on time."
Yes, or they could just live within their means like everybody (except the gov't) does).
This is a bill that will benefit the working class from these consciousless predators. I hope it passes. Too bad many of the same politicians who grandstand everyday as "moral crusaders" are on the payrolls of these moneylenders.
Rkymtn | 10:04 a.m. Feb. 15, 2009
I have dealt with "Pay Day" loans that have defaulted and the interest
rates are sky high. The problem is that many of the people who take them out
end up digging a hole they can't get out of and by the time they default
its too late. I do agree that a business, like "Pay Day" loans has a
right to make a profit, but I also beleive they have a responsibility to help
those who get in trouble get out without legal action.
Of note are the asset loans. Basically you pledge your washer/dryer, TV, VCR, or someother asset for a $1,000 loan. By the time the loan origionation fee, document prep fee, etc., are taken out the individual is luckey to walk out the door with $300 or so. When they default, the company comes after them for a judgement, gets it, and then garnishes whatever they can putting the person in a real pickle financially.
I do think short term loans have their place, and if you look at what Banks charge, its not far off, but I think budget counseling would be a much wiser choice.
Of note are the asset loans. Basically you pledge your washer/dryer, TV, VCR, or someother asset for a $1,000 loan. By the time the loan origionation fee, document prep fee, etc., are taken out the individual is luckey to walk out the door with $300 or so. When they default, the company comes after them for a judgement, gets it, and then garnishes whatever they can putting the person in a real pickle financially.
I do think short term loans have their place, and if you look at what Banks charge, its not far off, but I think budget counseling would be a much wiser choice.
Shut them down | 10:05 a.m. Feb. 15, 2009
Payday lenders are an unnecessary evil. They prey on the stupid. Only a fool
would pay over 500% interest on very small loans. Some people just have no
sense. They could do without the $100 but because it's available, they
borrow it and aren't smart enough to realize what a financial hole they are
digging. The availability of credit to people who can't or won't pay
their loans back has to stop. And charging outrageous interest rates is
criminal. It's not a "business," it's robbery. Just shut
them down. No one is going to miss "Payday lenders."
Tibodeaux | 10:15 a.m. Feb. 15, 2009
If 95% of borrowers pay off there loans and only 2.5% have to have legal action
why do you need 500++% interest??
Where is the risk of making these loans until the bitter end???
If they want to have people on their side they should make the loans for one year and if the borrower makes all twelve payments the loan is paid off, end of story.
Where is the risk of making these loans until the bitter end???
If they want to have people on their side they should make the loans for one year and if the borrower makes all twelve payments the loan is paid off, end of story.
JW Morrison | 10:17 a.m. Feb. 15, 2009
So when are they going to do the same to banks? You overdraft for $3 and get
hit with $35 fee. Overall, government wants to be the only people that can
overdraft without consequence. While Pay Day loans charge high interest they
are filling a need that banks will not fill.
TO: 99% of the posts | 11:43 a.m. Feb. 15, 2009
The payday loan industry is the one industry that HAS NOT contributed to the
current credit crisis that our country is in. What's interesting to see
here is that nobody has mentioned that mortgages to people buying homes they
can't afford is what has actually gotten us here. The people that have
gotten into these mortgages just because their "CREDIT" would suggest
they can afford it, is what has gotten us here. Because these large (and
reputable) national banks and lenders (not payday lenders, mind you) have been
telling borrowers they can afford a home WAY out of their price range, it has
given people the idea that all of the sudden the checks they bring home every
month doesn't really matter. "Hey, the bank says i can afford it, I
guess I can." Guess who is not giving money out based on a credit score?
SOME payday lenders are out of control, yes. But the industry itself is very
much necessary. They are lending money based on your checking account, not a
three digit number that has been kicking our country's rear-end for the
past five years.
Sean | 11:57 a.m. Feb. 15, 2009
How they get their 95% figure is when one of their customers takes a roll over
loan the first one gets "paid off" with a second loan and so forth.
In Colorado almost every little strip mall had a payday loan place and a pawn
shop. (Most had a little chuch also, but that is another story)
Utah Politicians | 12:42 p.m. Feb. 15, 2009
there ya go. I forget the exact percentage...90 to 95% of Utah's
legislators are mormon. And they can be had and bought as cheaply as any
politician. The hypocrisy in Itah politics is astounding. Out of one side of
their mouth they talk about this great family state, out of the other they allow
loan sharks to bleed families dry and will hardly spend a penny on kid's
educations. Utah is 51st, behind Puerto Rico in spending on education. And who
puts these 90% mormon legislators in office? Sheep. Sheep who don't even
bother to look past their religious affiliations. The only two words that
matter to mormon voters in this state are "mormon" and
"republican." As long as those two checkboxes are checked, who they
are, how they govern doesn't make a bit of difference. Utah is no stranger
to corruption at all.
Good Riddance | 1:20 p.m. Feb. 15, 2009
Our moderately autistic son was a victim of identity theft - over $10,000 of
these loans were taken out in his name. He did not match the crook physically at
all! The various companies all loaned to him. None bothered to see if the guy
even had a job that COULD pay them back.
An independent but childlike, trusting adult, our son didn't tell us about the problem because it involved a friend. Terrifed to ruin his own credit, he quietly paid the bills as the calls rolled in. Eventually we discovered what was going on and the police became involved.
Of course, the money was gone - No - they wouldn't reimburse for identity theft.
The people who work for these places can't find a job elsewhere. They are hard working - I don't blame them but I don't know how they can sleep at night knowing they are screwing everyone that comes in that door - you can't justify enabling people to overspend.
We still get regular phone calls begging our son to please remember that he is a valued customer and they'd love to be of help.
Good bye - I won't miss them.
An independent but childlike, trusting adult, our son didn't tell us about the problem because it involved a friend. Terrifed to ruin his own credit, he quietly paid the bills as the calls rolled in. Eventually we discovered what was going on and the police became involved.
Of course, the money was gone - No - they wouldn't reimburse for identity theft.
The people who work for these places can't find a job elsewhere. They are hard working - I don't blame them but I don't know how they can sleep at night knowing they are screwing everyone that comes in that door - you can't justify enabling people to overspend.
We still get regular phone calls begging our son to please remember that he is a valued customer and they'd love to be of help.
Good bye - I won't miss them.
Richard | 1:37 p.m. Feb. 15, 2009
Pass this law and get this criminals out of business. People made it before
Payday Loan companies (Loan Sharks) started their (BUSINESS) of distroying
people.
Why do Mindless, mental midgets start mormon bashing? Is it to cover their own mental incompetence and story fabrication? Black wants to protect people and help the poor. Mormon basher does seem to know a lot about corruption. Is it from making up stories about mormons or just general deception?
Why do Mindless, mental midgets start mormon bashing? Is it to cover their own mental incompetence and story fabrication? Black wants to protect people and help the poor. Mormon basher does seem to know a lot about corruption. Is it from making up stories about mormons or just general deception?
Watched it happen | 1:40 p.m. Feb. 15, 2009
I had a friend who couldn't distinguish between wants and needs, and
turned to payday loans. The only thing that came out of the loans was a slightly
delayed bankruptcy. Get rid of payday loans.
Anonymous | 1:40 p.m. Feb. 15, 2009
Its lobbyist, Frank Pignanelli, added, "It would force the industry out of
business here."
And that's a BAD thing??????
And that's a BAD thing??????
utah lawyer | 2:13 p.m. Feb. 15, 2009
Utah has become a national laughingstock as one of the few states that
hasn't regulated this mess. Remember, these payday services charge more
interest than mob loansharks in the 70's.
Anonymous | 2:32 p.m. Feb. 15, 2009
It would be great to see a community based religion step in and provide
it's members who have a need for small loans. It would add a new dimension
to being a member in good standing.
the truth | 3:07 p.m. Feb. 15, 2009
RE: LIBERAL LARRY:
we do not agree on much at all, but on this I completely agree with you.
I think all loan interest should done away with,
and there shpould be loan charge based the length of the loan.
I buy house why should it cost me more than twice as much by the time I pay it off?
Why is most of my payment interest?
This is what make house prices go up so quickly.
And I would add the predatory fee practices of banks should be heavily regulated.
we do not agree on much at all, but on this I completely agree with you.
I think all loan interest should done away with,
and there shpould be loan charge based the length of the loan.
I buy house why should it cost me more than twice as much by the time I pay it off?
Why is most of my payment interest?
This is what make house prices go up so quickly.
And I would add the predatory fee practices of banks should be heavily regulated.
Welcome Communism!! | 3:34 p.m. Feb. 15, 2009
Get Rid of Bank Overdraft Fees. Get Rid of Payday Lenders. Get Rid of Self
Interest. Get Rid of Freedom. Get Rid of Self-Controlled Markets. Get Rid of
the Invisible Hand.
"Oh Communism We Welcome You With Open Arms"
"Oh Communism We Welcome You With Open Arms"
Stewart | 3:42 p.m. Feb. 15, 2009
Pay Day Loans are nothing more than legal loan sharks. Prior to the mid 1970s
we had usury laws to protect the public from this sort of thing. I think the
interest maximum was about 24%. Then we had a period of high inflation of above
10% and normal home loans reaching as high as 15%. So they removed the usury
laws.
The pay day loan sharks were not necessary back then, because pawnshops filled the need of high interest loans. Interest rates as high as payday lenders charge and you dealt with the hairy knuckle guys. Now it is the same but they are legitimate. Let's set usury rates even lower down to 24-30% and take out the loan sharking credit card companies as well that are ruining the lives of people.
The pay day loan sharks were not necessary back then, because pawnshops filled the need of high interest loans. Interest rates as high as payday lenders charge and you dealt with the hairy knuckle guys. Now it is the same but they are legitimate. Let's set usury rates even lower down to 24-30% and take out the loan sharking credit card companies as well that are ruining the lives of people.
So called "Christians" | 4:05 p.m. Feb. 15, 2009
I wonder if people like Salt Lake County Republican Chairman, (and former State
Senator), James Evans, who makes his living from the PayDay lendor business, and
all those legislators who take campaign $ from the PayDay lendor business, (most
of whom profess to be Christian), have any idea of what the Bible actually says
about this business? In Biblical times, the charging of any interest was
considered, "usury", and the Bible speaks against it in Exodus 22:24,
Leviticus 25:35-37, and Deut 23:20-21. In modern times, "usury" has
come to be defined as the charging of, "excessive interest", and in
anyone's book, 500% interest has to be considered, "exessive".
Perhaps these "so called" Christian legislators should re-read Matthew
25:40, where Jesus is quoted as saying, "Verily I say unto you, inasmuch as
ye have done it unto one of the least of these, my bretheren, ye have done it
unto me".
JG | 4:17 p.m. Feb. 15, 2009
In the past 10 years or so, I have watched new strip malls come to town, excited
that we might get some new stores. Instead, they each have one or two PayDay
Loan places in them. I can't believe our town needs so many of them! Is
the demand that big for these loans?
I watched a family friend start going to these places when he got on Social Security Disability for Schizophrenia. He got into those roll over loans. Every month the payday loan place took a bigger and bigger share of his check. He then turned to his friends for small loans ($20. here and there). He died.
When my daughter was in college, her unscrupulous room mate took her car title and went to one of these places and got cash for the title. What a mess we had to go through to clear that up. Yes, we had to call the police.
What bothers me is the legislature is taking money from these places! They are taking money from Energy Solutions too. What do you suppose they will demand from our legislatures for their "investment"?
I watched a family friend start going to these places when he got on Social Security Disability for Schizophrenia. He got into those roll over loans. Every month the payday loan place took a bigger and bigger share of his check. He then turned to his friends for small loans ($20. here and there). He died.
When my daughter was in college, her unscrupulous room mate took her car title and went to one of these places and got cash for the title. What a mess we had to go through to clear that up. Yes, we had to call the police.
What bothers me is the legislature is taking money from these places! They are taking money from Energy Solutions too. What do you suppose they will demand from our legislatures for their "investment"?
Dee | 7:39 p.m. Feb. 15, 2009
It was mentioned in an earlier comment that Payday loans are not as bad as the
old Mafia loan sharks. "At least they don't break your legs if you
don't pay." Maybe not your physical legs, but they do break your
financial legs.
It is not likely that Ms. Black's bill will even get a hearing from the bribed legislature. Maybe it is time to start a petition to put the issue on the ballot. Let the people decide.
It is not likely that Ms. Black's bill will even get a hearing from the bribed legislature. Maybe it is time to start a petition to put the issue on the ballot. Let the people decide.
wake up | 12:19 a.m. Feb. 16, 2009
when will Utah wake up and see these politicians they elect for what they are?
they are no different than other politicians. they are driven by greed and
money. they take contributions and vote by their pocketbooks. as bad or worse
than politicians in other states. worse actually. because they know they are
shielded in a cloak of trust of the people who simply vote based on trust in a
religion and party affiliation. isn't it time for people to become aware
and demand an accounting of these men? they give no regard to the poor who have
few choices in front of them and go for the people who prey upon them. if other
states can regulate these businesses why can't utah? it begs the question,
why does the majority of Utah not even care? Blind trust is blindness, no
matter how you look at it. They are your friends, your fellow man being preyed
upon. There is room for businesses that lend. Why does the profit margin have
to be so high in Utah vs other states? It's blindness. Cold uncaring
attitudes. People who dont want to think. It's sad.
Details, details.... | 9:17 a.m. Feb. 16, 2009
Why didn't Laura Black mention that she received over 50 letters from her
constituents asking her to withdraw her support for this bill? Why didn't
she mention the 500 other constituents who signed a petition against this
bill?
Or did Left Leaning Lee simply forget to mention that "detail" in his article?
Or did Left Leaning Lee simply forget to mention that "detail" in his article?
No Fractional Reserve Banking | 2:49 p.m. Feb. 16, 2009
If you want to know why a bank or credit union can offer loans for lower
percentage rates, it's because of fractional reserve banking.
A bank can lend $100 but only have $10 at risk.
If a Payday lender loans a $100 he has $100 at risk.
As long as payday lenders don't want bailouts at taxpayer expenses then they are my new favorite credit option.
A bank can lend $100 but only have $10 at risk.
If a Payday lender loans a $100 he has $100 at risk.
As long as payday lenders don't want bailouts at taxpayer expenses then they are my new favorite credit option.
RE: No Fractional... | 4:20 p.m. Feb. 16, 2009
If you can't handle the risk you shouldn't be lending people money.
The fact is they can handle the risk, they are making a huge profits, otherwise they would not be in business.
The fact is they can handle the risk, they are making a huge profits, otherwise they would not be in business.
RE: No Fractional Reserve Bankin | 6:49 p.m. Feb. 16, 2009
The point is, it's the payday lenders' money. Let them determine how
much risk they are willing to accept by setting their own rates.
And let the borrower decide how much debt they want to take on.
It's not governments job to jump in the middle of this.
If they payday loans are not being advertised properly then have at 'em. But if they are being advertised correctly then let it go. People are big boys and girls. They can make their own decisions. They don't government to hold their hand.
And let the borrower decide how much debt they want to take on.
It's not governments job to jump in the middle of this.
If they payday loans are not being advertised properly then have at 'em. But if they are being advertised correctly then let it go. People are big boys and girls. They can make their own decisions. They don't government to hold their hand.
jkursman | 10:49 a.m. Feb. 17, 2009
Payday loans are accessed by 19 million Americans each year because they offer
significant cost savings versus:
The avg. $27 plus interest fee on a bank overdraft (APR 704%)
The avg. $29 fee on a late credit card payment (APR 757%)
$51 in NSF and merchant fees on a $100 payment (APR 1329%)
A $50 late/reconnect fee on a $100 utility bill (APR 1303%)
In addition to being more expensive, these options negatively impact credit ratings that may hurt a consumer�s access to employment, housing, insurance and other credit options.
APR is a measurement tool designed to compare ANNUAL products and does not accurately depict the fees a Utah resident pays for a $100 TWO-WEEK payday loan. In addition, similar products currently offered by traditional banks and credit unions also exceed 100% APR with terms that may result in additional fees and even higher APRs.
Most bank account holders would pay more to withdraw their own money from an ATM than the proposed cap would allow short-term lenders to charge for an unsecured loan.
Utah should not limit consumer credit options or competition. Working families will pay the steeper price.
The avg. $27 plus interest fee on a bank overdraft (APR 704%)
The avg. $29 fee on a late credit card payment (APR 757%)
$51 in NSF and merchant fees on a $100 payment (APR 1329%)
A $50 late/reconnect fee on a $100 utility bill (APR 1303%)
In addition to being more expensive, these options negatively impact credit ratings that may hurt a consumer�s access to employment, housing, insurance and other credit options.
APR is a measurement tool designed to compare ANNUAL products and does not accurately depict the fees a Utah resident pays for a $100 TWO-WEEK payday loan. In addition, similar products currently offered by traditional banks and credit unions also exceed 100% APR with terms that may result in additional fees and even higher APRs.
Most bank account holders would pay more to withdraw their own money from an ATM than the proposed cap would allow short-term lenders to charge for an unsecured loan.
Utah should not limit consumer credit options or competition. Working families will pay the steeper price.
Zeus | 3:01 p.m. Feb. 17, 2009
Why does everyone assume that a payday loan customer is poor, desperate,
uneducated, desolate, irresponsible people? I beg to differ, they are smart
enough to figure out the benefits of using a payday loan rather than bouncing a
check (it happens to the best of us!), or to pay a credit card bill even one day
late.
People need to lay off and quit judging others. If a grown adult chooses to take out a payday loan for what ever the reason, we should not judge and doubt their ability to make their own financial decisions.
Visit a local payday lender and you can see all the interest rate signs hanging in the lobby. The consumer is fully aware of the cost to take a out payday loan.
People need to lay off and quit judging others. If a grown adult chooses to take out a payday loan for what ever the reason, we should not judge and doubt their ability to make their own financial decisions.
Visit a local payday lender and you can see all the interest rate signs hanging in the lobby. The consumer is fully aware of the cost to take a out payday loan.
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