Those who take out payday loans are usually those who are least able to afford the fees. They are also enticed by the easy money up front. When the payments come due, on their next paydays, they find that paying that amount out of a future check places a new hardship on them.
There are also "title lenders" who have the borrower sign the title to their car over to them. If these borrowers miss a payment, their car is repossessed and usually sold on-line.
In response to some of the comments, yes, people do need to have someone watching out for them. We have the FDA, the FAA, the FCC, to name some agencies who watch out for our food, medicines, transportation, communications, etc. We have the AMA, who watches over certfication of doctors, the ABA, who watches over lawyers.
Payday lenders seem like they do a service for those unable to get bank loans, but in reality they are preditors of the weakest, which as a country and society we need to protect.
Corker shaping payday loan rules in financial reform package
Those who take out payday loans are usually those who are least able to afford the fees. They are also enticed by the easy money up front. When the payments come due, on their next paydays, they find that paying that amount out of a future check places a new hardship on them.
There are also "title lenders" who have the borrower sign the title to their car over to them. If these borrowers miss a payment, their car is repossessed and usually sold on-line.
In response to some of the comments, yes, people do need to have someone watching out for them. We have the FDA, the FAA, the FCC, to name some agencies who watch out for our food, medicines, transportation, communications, etc. We have the AMA, who watches over certfication of doctors, the ABA, who watches over lawyers.
Payday lenders seem like they do a service for those unable to get bank loans, but in reality they are preditors of the weakest, which as a country and society we need to protect.