22 février 2014 ~ Commentaires fermés

Payday Loans Should Be A National Concern in Kentucky

Payday lending or making payday loans is a booming industry now, and with life getting tougher for many people each and every full day, it’s only ever going to keep expanding.
At the same time, it’s an often unregulated business, with 17 states of the USA in effect banning payday lending altogether as a result of apparent lawlessness of the industry.
It’s not that hard to see why there is such a problem. Although such payday loans – www.payday-loans-no-faxing.us, are intended to be short term arrangements only, getting you through to your next pay check basically, unfortunately, for many people, that’s not the way it actually works out. Sufficient reason for industry average rates of interest around 470% APR, one has to ask, why is this industry rapidly growing so?
The answer is that it is providing a service that is required, at a price that the consumers can afford; the actual APR is of no great interest to the customer, because their only concern is « Can I afford to repay the loan on my next payday »?
Why do consumers use payday advances? The answer probably falls into two parts:
First, because it is a fast, convenient means of getting quick cash (and now that it may be done online, it’s even easier) and, second, because they cannot get credit any other way probably.
For a borrower with a poor credit history payday loans offer a lifeline when it is most needed, to cover those unexpected bills or to prevent repossession of an item that has been bought on credit for example.
Problems only arise when customers are unable to repay loans (but surely this applies to all forms of credit? ).
None the less, it’s undeniable that, with such astronomically high APR rates, it only takes a couple of missed payments for the initial small sum borrowed to become a major debt burden.
Take for example Ms. A’s case. She took a loan of $500, with interest due on repayment of this sum two weeks later, of $125. Several missed payments down the road and the debt had ballooned to $3250, to settle a debt of only & 500! How scary is that?
Of course, pay day loans DO have a role to play in the day to day life of modern America and there are many industry insiders, from the more reputable lenders, who are pushing hard for the introduction of stricter regulations, regulations that could then be introduced across the nation, than on a state by state basis rather.
In this real way, the consumer will know exactly where they stand in terms of the laws relating to payday lending, and it surely will be in the interests of the more reputable lenders to expand across the nation as well. This ensures that everyone has access to their services, thus removing them from the potential clutches of some of the less ethical money lenders.
As Jeann Ann Fox of the customer Federation of America puts it, the current system means that « Payday lending is the poster child for predatory small loans that take advantage of consumers who’ve trouble making ends meet ».
A standardization of payday lending regulations and laws across the country should go quite a distance to making this kind of gloomy prognosis redundant in the future.

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