The New Intimacy

What do you think of "payday lenders"?

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Contributor: spiced spiced
There's an article in today's NY Times about JPMorgan making changes to protect their customers from payday lenders.

I've always thought that payday lenders take advantage of people in desperate situations; I wouldn't mind if they were outlawed.

What do you think?
03/19/2013
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Contributor: spunkmonkey spunkmonkey
I think if people want their services, then the deserve the high interest they get charged.
03/19/2013
Contributor: gsfanatic gsfanatic
They're a really bad idea and cost people a lot more than they should, so they victimize people who don't have a lot of money
03/20/2013
Contributor: The Vixen The Vixen
Quote:
Originally posted by spiced
There's an article in today's NY Times about JPMorgan making changes to protect their customers from payday lenders.

I've always thought that payday lenders take advantage of people in desperate situations; I wouldn't mind if ... more
I agree with you, a lot of times it does seem like robbery. Luckily a lot of states have laws that protect the borrower by limiting the amount of interest and fees that a payday lender can charge.

And I guess as long as everything is stated up front(extra charges, fees, interest), then it's fair. But I know I definitely never want to get involved with any lenders like that.
03/20/2013
Contributor: spiced spiced
Quote:
Originally posted by The Vixen
I agree with you, a lot of times it does seem like robbery. Luckily a lot of states have laws that protect the borrower by limiting the amount of interest and fees that a payday lender can charge.

And I guess as long as everything is stated up ... more
Maybe I'm wrong, but I don't think ANYBODY actually WANTS to use a payday lender. It seems like a move only somebody in a desperate situation would make.

I'm all in favor of free enterprise, but there have to be limits. In my state, there's a "price gouging" law forbidden sellers raising their prices more than a certain amount during an emergency. That's to protect people in a desperate situation and it's a good law, in my opinion.

I see the payday loan issue the same way. The only difference is that an emergency affects both rich and poor, while payday loans only negatively impact the poor. I hope all states will adopt laws limiting interest and fees. Some the rates now are worse than loan sharks used to charge when I was a kid!
03/21/2013
Contributor: Chilipepper Chilipepper
Some of us actually do live paycheck to paycheck - it's the only way to get the money immediately for businesses who won't take payments (ie: mechanics). It sucks, but not all of us have the luxury of making enough to have a savings.
03/21/2013
Contributor: spiced spiced
Quote:
Originally posted by Chilipepper
Some of us actually do live paycheck to paycheck - it's the only way to get the money immediately for businesses who won't take payments (ie: mechanics). It sucks, but not all of us have the luxury of making enough to have a savings.
I apologize if I came off insensitive. I used to live paycheck to paycheck, too, but it was 20 years ago. I probably would have taken a payday loan to keep from getting evicted, if the option had been available.

I'm NOT opposed to loans, but I am opposed to interest and fees that are LITERALLY worse than what loans sharks used to charge. There have to be limits. Otherwise, those with money to lend will take unfair advantage of people with no other options.
03/21/2013
Contributor: anonymous1298304 anonymous1298304
it's a necessary evil. it could be the ONLY option in some situations. think toilet not working, emergency vet bill, etc.

as long as the disclosures are clear and the person understands the terms. though i'd like to see it regulated more. but not in a way that would make it more difficult to get.

it's a rip off, just like rent to own furniture. but there is a need for it, it just needs to be regulated better so the buyer knows how bad it sucks
03/21/2013
Contributor: Chilipepper Chilipepper
Quote:
Originally posted by spiced
I apologize if I came off insensitive. I used to live paycheck to paycheck, too, but it was 20 years ago. I probably would have taken a payday loan to keep from getting evicted, if the option had been available.

I'm NOT opposed to loans, ... more
Understandable, and I know you didn't mean to be. After having ran a household on a $9,000 budget in 2007, I can never knock how people are able to get money to pay their bills. My ex-husband refused to let me sell a kidney. (He really didn't need it.)

And, yes, I do agree about the interests being ridiculous. As Kenzie said, a necessary evil. Especially in this economy.
03/21/2013
Contributor: RonLee RonLee
I have so far been able to avoid using "payday loans". However, if someone else feels that they need that option, who am I to say they shouldn't have that choice. They have a place.
03/21/2013
Contributor: Gone (LD29) Gone (LD29)
I think payday loans are a necessary evil. I don't like them, but we normally live paycheck to paycheck and using an payday loan helped us get our car fixed in an emergency when we didn't have any other way to get it done. Can't go to work without a car, so we really didn't have another option. We knew the terms of the loan up front, and I'm grateful that it was available.

We have also occasionally used the direct deposit advance feature that our bank offers, which is a lot less expensive. It's a nice help to make ends meet when things are tight, as long as you know the fees up front and are able to pay it back.
03/21/2013
Contributor: spiced spiced
I should have been more careful about my original post. When I said I wouldn't mind if they were outlawed, what I should have said was that I wouldn't mind if the worst practices of payday lenders were outlawed. Stuff like this (from the article):

"...payday lenders [offer] short-term loans with interest rates that can exceed 500 percent... Ivy Brodsky, 37... was charged $1,523 in fees — a combination of insufficient funds, service fees and overdraft fees — in a single month after six Internet payday lenders tried to withdraw money from her account 55 times.

"Another change at JPMorgan is intended to address the difficulty that payday loan customers face when they try to pay off their loans in full. Unless a customer contacts the online lender three days before the next withdrawal, the lender just rolls the loan over automatically, withdrawing solely the interest owed.

"Even borrowers who contact lenders days ahead of time can find themselves lost in a dizzying Internet maze, according to consumer lawyers. Requests are not honored, callers reach voice recordings and the withdrawals continue, the lawyers say."

While the loans themselves may be a necessary evil, the way some of these companies are operating is totally unnecessary — and just plain EVIL.
03/21/2013