Where Everybody Knows You're Numb

BoxDog · Guru

RE: "Payday loans" et al

Psych Lit · Guru

BoxDog wrote:

P
it also has a self imposed limit based upon income. There's also a law in place and a network used to assure there is no outstanding note at any other type of outfit. Thus ensuring the person can't get in "over their head" beyond their means.

do they allow them to "roll over" the note for another go? thats the predatory part in my thinking. if someone finds themselves in those circumstances what are the odds that they will be able to kick over 500 plus the fee from their next paycheck? prolly pretty low or theyd prolly have something in savings. if they roll it over they pay another fee and if this happens 4 or 5 times basically they have doubled the debt in a few short weeks. sort of reminds me of those rent to own places where you end up paying 2000 for a 300 dollar tv set. marshmallow test. its a good thing.

They also MUST have a job. There's something our banks can't or are to offer and guarantee. I saw it up close, there is pride, desperation, need, despair, and sometimes people feel they can't ask their family and close friends for any further help.

sure but having to face those things are what causes people to change the behaviors that got them in the mess in the first place.

You can bet good money they'll repay the cash depots long before they ever find time to fully repay their loved ones.

prolly very true and also very sad.

That's just the way of the world. It was a good thing the cash was there for her, and that it was something that I was able to easily address as a parting gift. Now the "bad checks" that the grocery store continued to cash and the piling up of bad check charges and late fees on her checking account? I said shame on the bank and the grocery. Really,I remember clearly how ruthless and cruel her bank was to her. I think it was Wachovia, or Republic. Either way, the tactics must be similar.

back in the dark ages when i was a banker the rule was that, in the case of multiple checks coming in, the largest check that would cover the od and the fee is the one that was returned. these days this is not the case. its the reverse. banks like bounced checks, its a real money maker. instead of one check being returned they pay the largest and bounce the smaller ones up to the amount overdrawn and charge you for each one. they also can redeposit them and getcha before you even get the notice that youve messed up and charge you again all of which didnt happen way back then when theyd mail the notice and hold the check.

Charities are falling apart, the states aren't providing any funding, corporate donations are at an all time low, staffers are losing jobs. Food banks are running out of food, shelters are at capacity. Electric companies are being approved 25% pay hikes. Employer emergency funds? In places such as Florida, Texas and Washington state, Oklahoma, Kansas, and on and on those limited funds are intended for major disasters. Natural ones, fires, floods, lost homes, emergency help with a special cause or urgent need.

ok see now these are the kinds of things that i think one would be visiting the payday advance people for. if its not that urgent why not wait till payday?

There is nobody left to tap. I think Arizona has failed it's people. I'm not shocked. The worlds gone mad.

BoxDog · Guru

Psych Lit wrote:

Nightowlhoot3 wrote:

There was a measure on the ballot last election cycle here in AZ, which asked whether or not these "payday loan" places should be kicked out of the state (presumably because they charge such ridiculously high interest rates.) The measure passed decidedly.
good for az!
I voted for in favor of the bill, but not whole heartedly, and now, in February, I'm sort of regretting my vote.

I hate when that happens.

Here's the deal: I do understand that it's a practice which takes advantage of lower income people. That's pretty much why I voted in favor of their leaving. But why shouldn't people be able to borrow money where ever they want, from whomever they want, at whatever interest rate they are willing to accept? Should the government be allowed to legislate which "expensive" uses we, as citizens, make of our money?
i think of it much the way i think of someone who sells...say an appliance that is dangerous or broken, to someone who is desparate to have that appliance. the prohibition is on the company to not sell not on the person to not buy.
pay day loans are horrid for people. those who take them out are often desparate and see that as a quick fix and nearly always assume that when payday rolls around they will have the money to repay the loan but most of the time if this were the case they wouldnt be in the fix they are in so when payday rolls around they have to take out another payday loan to cover the first loan and then they have doubled the already outrageous fee charged on the first loan. they get deeper and deeper into a mess that they may not be able to get out of. some of these sleezy companies charge 1000 percent interest.
i think one of the lessons that weve learned from this chaotic economy is that those financial institutions are in it for the bucks not good will. remember when 17 percent interest was considered high for a credit card? then some state, i cant recall which but im thinking it was delaware or south dakota dropped their usuary laws allowing credit card rates to be uncapped and all of the other states followed suit because they didnt want to lose the money train that followed those high rates. within a year or two it was routine to have credit card rates in the 20 and 30 percent range if someone missed a payment or was late on something even umrelated to the credit card the rates on all of their cards were jacked up. of course at 20 to 30 percent interest those people will never pay off those cards so its essentially a pay for life scheme. imo this is criminal and those legislators who signed off on this should be hung.
laws imo should exist to protect the innocent and the sparate. if it wont harm either of those groups im all for it.

If someone is in desperate need of some money, and they can't get it from a low interest bank, and pay day is a week away, what is that person supposed to do? Go to a more shady resource?
borrow from a friend or family member. ask for a pay advance from work. borrow from a church or the salvation army. collect deposit pop cans. babysit. clean houses. do day labor. panhandle. pawn things. sell their blood. go without. there are few things that i can think of that would fall into that category. ok if the house or car is going to be repoed perhaps but im thinking a phone call asking for an extention might be a far better investment than a 500 or 1000 percent interest loan. or maybe a death of a parent or child that requires immediate travel, but id try the borrow from the above before doing any of that. im thinking people take this more because they want to keep their stuff private which borrowing from friends or family does not do. still, it seems like something that could really get someone in a far worse bind in a big hurry.
See, this whole thing is, for me, exaccerbated by the fact that there is no law regarding the number of state sanctioned Lottery tickets one may purchase here. Actually, one is encouraged to buy lottery tickets, and constantly reminded of how it's little more than an act of good citizenship, really. All those parks that have come about from lottery money, all those really good, and wholesome things ...
and lets not forget that the lottery also funds the problem gamblers line. that always blows my mind when i see the ad.
im not a big fan of gambling but i think its slightly different because the desparation is usually not there in the beginning so clear intent and no coercion is present. that may change if they keep adding to their losses but thats after the fact.

Is spending money on interest on a loan a less advisable act than spending that same money on a fist full of lottery tickets? How much control by the government "for our own good" are we willing to accept? There is already a long list of dubious practices of which the state has now taken control -- this just seems to be another to add to the list, in a way.

i see the point and its a good one. in my head tho the law is not so much to prevent the person from borrowing as it is to prevent these predatory companies from lending at those rates. i mean if they cant find a place to do business they will have to change their methods and perhaps lower those rates to be within some sort of ethical framework.

I have been thinking of this one since it was brought up. I strongly disagree in the outlawing of this service. It can be a temporary means to a resolve, a short term situation. My experience with this, in Florida, dates back a little better than three years ago. I assume the basics are still in place. It was part of a favor I took care of for someone very important to me. Apparently, and this may only be here in Fl the brick and mortar "predator" (sic) has a state regulated limit of 500.00 per advance. It also has a self imposed limit based upon income. There's also a law in place and a network used to assure there is no outstanding note at any other type of outfit. Thus ensuring the person can't get in "over their head" beyond their means. They also MUST have a job. There's something our banks can't or are to offer and guarantee. I saw it up close, there is pride, desperation, need, despair, and sometimes people feel they can't ask their family and close friends for any further help. You can bet good money they'll repay the cash depots long before they ever find time to fully repay their loved ones. That's just the way of the world. It was a good thing the cash was there for her, and that it was something that I was able to easily address as a parting gift. Now the "bad checks" that the grocery store continued to cash and the piling up of bad check charges and late fees on her checking account? I said shame on the bank and the grocery. Really,I remember clearly how ruthless and cruel her bank was to her. I think it was Wachovia, or Republic. Either way, the tactics must be similar. They continued to pile debt on top of her every single month. A payday advance company is NOT a predatory lender. One has to first walk in, secondly, have a job, and lastly can't get more than 500 and some service fee. I think it will create more desperation in already brutal times. Charities are falling apart, the states aren't providing any funding, corporate donations are at an all time low, staffers are losing jobs. Food banks are running out of food, shelters are at capacity. Electric companies are being approved 25% pay hikes. Employer emergency funds? In places such as Florida, Texas and Washington state, Oklahoma, Kansas, and on and on those limited funds are intended for major disasters. Natural ones, fires, floods, lost homes, emergency help with a special cause or urgent need. There is nobody left to tap. I think Arizona has failed it's people. I'm not shocked. The worlds gone mad.

MyCat8it · Senior Member

Nightowlhoot3 wrote:

There was a measure on the ballot last election cycle here in AZ, which asked whether or not these "payday loan" places should be kicked out of the state (presumably because they charge such ridiculously high interest rates.) The measure passed decidedly.

I voted for in favor of the bill, but not whole heartedly, and now, in February, I'm sort of regretting my vote.

I hate when that happens.

Here's the deal: I do understand that it's a practice which takes advantage of lower income people. That's pretty much why I voted in favor of their leaving. But why shouldn't people be able to borrow money where ever they want, from whomever they want, at whatever interest rate they are willing to accept? Should the government be allowed to legislate which "expensive" uses we, as citizens, make of our money? If someone can't spend the money on a loan, should we also make it illegal to spend it on ... I dunno ... water? Air in a can? How about a sack of rocks? (All things I've purchased, btw) And let's throw in the ever available example of the Big Mac just for good measure. How about liquor designed pretty much to ONLY get you REALLY drunk quickly?

If someone is in desperate need of some money, and they can't get it from a low interest bank, and pay day is a week away, what is that person supposed to do? Go to a more shady resource?

See, this whole thing is, for me, exaccerbated by the fact that there is no law regarding the number of state sanctioned Lottery tickets one may purchase here. Actually, one is encouraged to buy lottery tickets, and constantly reminded of how it's little more than an act of good citizenship, really. All those parks that have come about from lottery money, all those really good, and wholesome things ...

Is spending money on interest on a loan a less advisable act than spending that same money on a fist full of lottery tickets? How much control by the government "for our own good" are we willing to accept? There is already a long list of dubious practices of which the state has now taken control -- this just seems to be another to add to the list, in a way.

I understand what you're saying, but I have to side with Psych on this. Once you get on that cycle, it's very hard to get off, then it trashes your already bad credit.

Don't rue your vote. If Arizonians really want a payday loan, they can get it online. I googled some payday loans. Here's what one FAQ reads:

"What is the cost of credit for a payday loan?
The cost of a USA Payday Loan is $30.00 per $100.00 borrowed. For example, the total cost of an 14 day loan for $100.00 would be $130.00 (APR of 782.14%). Please refer to our fee schedule for more information about payday loan fees and payment options."

782%

I remember a time when it was against federal law to charge above 18% or maybe it was 21%. Over the past 10-15 years, that limit seems to have disappeared. Is that the "deregulation" that everyone has been talking about? If so, I vote to re-regulate these financial institutions.

I'm a huge advocate of capitalism, but not blatant usury. This strangles the consumer and is never good in the big picture. Bring back the limits on interest rates, and watch how fast these payday loan places close up shop - oh right, let's not forget the refund anticipation loans, too. Ever see the interest charges on them?

Psych Lit · Guru

Nightowlhoot3 wrote:

There was a measure on the ballot last election cycle here in AZ, which asked whether or not these "payday loan" places should be kicked out of the state (presumably because they charge such ridiculously high interest rates.) The measure passed decidedly.
good for az!
I voted for in favor of the bill, but not whole heartedly, and now, in February, I'm sort of regretting my vote.

I hate when that happens.

Here's the deal: I do understand that it's a practice which takes advantage of lower income people. That's pretty much why I voted in favor of their leaving. But why shouldn't people be able to borrow money where ever they want, from whomever they want, at whatever interest rate they are willing to accept? Should the government be allowed to legislate which "expensive" uses we, as citizens, make of our money?
i think of it much the way i think of someone who sells...say an appliance that is dangerous or broken, to someone who is desparate to have that appliance. the prohibition is on the company to not sell not on the person to not buy.
pay day loans are horrid for people. those who take them out are often desparate and see that as a quick fix and nearly always assume that when payday rolls around they will have the money to repay the loan but most of the time if this were the case they wouldnt be in the fix they are in so when payday rolls around they have to take out another payday loan to cover the first loan and then they have doubled the already outrageous fee charged on the first loan. they get deeper and deeper into a mess that they may not be able to get out of. some of these sleezy companies charge 1000 percent interest.
i think one of the lessons that weve learned from this chaotic economy is that those financial institutions are in it for the bucks not good will. remember when 17 percent interest was considered high for a credit card? then some state, i cant recall which but im thinking it was delaware or south dakota dropped their usuary laws allowing credit card rates to be uncapped and all of the other states followed suit because they didnt want to lose the money train that followed those high rates. within a year or two it was routine to have credit card rates in the 20 and 30 percent range if someone missed a payment or was late on something even umrelated to the credit card the rates on all of their cards were jacked up. of course at 20 to 30 percent interest those people will never pay off those cards so its essentially a pay for life scheme. imo this is criminal and those legislators who signed off on this should be hung.
laws imo should exist to protect the innocent and the sparate. if it wont harm either of those groups im all for it.

If someone is in desperate need of some money, and they can't get it from a low interest bank, and pay day is a week away, what is that person supposed to do? Go to a more shady resource?
borrow from a friend or family member. ask for a pay advance from work. borrow from a church or the salvation army. collect deposit pop cans. babysit. clean houses. do day labor. panhandle. pawn things. sell their blood. go without. there are few things that i can think of that would fall into that category. ok if the house or car is going to be repoed perhaps but im thinking a phone call asking for an extention might be a far better investment than a 500 or 1000 percent interest loan. or maybe a death of a parent or child that requires immediate travel, but id try the borrow from the above before doing any of that. im thinking people take this more because they want to keep their stuff private which borrowing from friends or family does not do. still, it seems like something that could really get someone in a far worse bind in a big hurry.
See, this whole thing is, for me, exaccerbated by the fact that there is no law regarding the number of state sanctioned Lottery tickets one may purchase here. Actually, one is encouraged to buy lottery tickets, and constantly reminded of how it's little more than an act of good citizenship, really. All those parks that have come about from lottery money, all those really good, and wholesome things ...
and lets not forget that the lottery also funds the problem gamblers line. that always blows my mind when i see the ad.
im not a big fan of gambling but i think its slightly different because the desparation is usually not there in the beginning so clear intent and no coercion is present. that may change if they keep adding to their losses but thats after the fact.

Is spending money on interest on a loan a less advisable act than spending that same money on a fist full of lottery tickets? How much control by the government "for our own good" are we willing to accept? There is already a long list of dubious practices of which the state has now taken control -- this just seems to be another to add to the list, in a way.

i see the point and its a good one. in my head tho the law is not so much to prevent the person from borrowing as it is to prevent these predatory companies from lending at those rates. i mean if they cant find a place to do business they will have to change their methods and perhaps lower those rates to be within some sort of ethical framework.

Nightowlhoot3 · Guru

There was a measure on the ballot last election cycle here in AZ, which asked whether or not these "payday loan" places should be kicked out of the state (presumably because they charge such ridiculously high interest rates.) The measure passed decidedly.

I voted for in favor of the bill, but not whole heartedly, and now, in February, I'm sort of regretting my vote.

I hate when that happens.

Here's the deal: I do understand that it's a practice which takes advantage of lower income people. That's pretty much why I voted in favor of their leaving. But why shouldn't people be able to borrow money where ever they want, from whomever they want, at whatever interest rate they are willing to accept? Should the government be allowed to legislate which "expensive" uses we, as citizens, make of our money? If someone can't spend the money on a loan, should we also make it illegal to spend it on ... I dunno ... water? Air in a can? How about a sack of rocks? (All things I've purchased, btw) And let's throw in the ever available example of the Big Mac just for good measure. How about liquor designed pretty much to ONLY get you REALLY drunk quickly?

If someone is in desperate need of some money, and they can't get it from a low interest bank, and pay day is a week away, what is that person supposed to do? Go to a more shady resource?

See, this whole thing is, for me, exaccerbated by the fact that there is no law regarding the number of state sanctioned Lottery tickets one may purchase here. Actually, one is encouraged to buy lottery tickets, and constantly reminded of how it's little more than an act of good citizenship, really. All those parks that have come about from lottery money, all those really good, and wholesome things ...

Is spending money on interest on a loan a less advisable act than spending that same money on a fist full of lottery tickets? How much control by the government "for our own good" are we willing to accept? There is already a long list of dubious practices of which the state has now taken control -- this just seems to be another to add to the list, in a way.