I rarely dig into politics, but I have a bone to pick.
Have any of you ever had to use a payday cash advance service? As a work at home mom, we are fortunate enough to write our own paychecks. But I am curious about all the bad buzz about cash advance services. I mean have you ever have a financial crisis where you needed money fast and didn’t know where to turn? Payday lenders allow you to take a payday loan as a cash advance from your next paycheck. And there is a lot of politics around this issue.
For instance, here is an example of a payday lender.
If you listen to Barack Obama, he is set to close down the payday lending industry.
Here’s a quote from Barack Obama’s website regarding his payday lending policy.
“Cap Outlandish Interest Rates on Payday Loans and Improve Disclosure: Obama supports extending a 36 percent interest cap to all Americans. Obama will require lenders to provide clear and simplified information about loan fees, payments and penalties, which is why he’ll require lenders to provide this information during the application process. “
He says that payday lenders are a corrupt industry that feeds upon consumers, trapping them. They get caught in an endless loop of one loan, then the next, and then finally defaulting on their personal loan or owing huge amounts of money for the interest on the loan.
But if you look at the flip side, cash advances provide a desperately needed source of income for people with real cash emergencies. If your daughter got sick and needed an expensive medicine and writing the check would overdraw your bank account what would you do? Not everyone has a credit card. Cash advances provide an easy way for people to borrow the money they need for real emergencies to get them by until their next paycheck.
If you think about what it’s like when you face a real emergency like putting food on the table or making a mortgage payment. Those are things you need to pay no matter what. And some people if denied a cash advance may turn to desperate measures like pawn shops, crime, even selling drugs to get the money they need.
If you look at states where the payday cash advance industry has been shut down, it has had a devastating effect. For example take a look at Georgia. Because the payday lending industry has been shut down, people are bouncing more checks, falling deeper into debt, and bancripty is at a new high.
The way I see it, in anything there will be people who abuse the system. People charge their credit cards sky high. You don’t see them shutting down the credit card industry.
Ok moms - I want your opinion…
What do you think about payday cash advances? If you had a corporate job and needed money before payday would you find a payday loan helpful? Or do you agree with Obama that the payday lending industry this is a predatory debt trap.
4
Subscribe
to RSS feed
Add to your favorite bookmark site
