I am so thankful to see all the intelligent comments, FOR this industry. I'm not in the payday lending industry; I never have been, but I was in the mortgage industry for more than 20 years.
Would you pay $15 to borrow $100? I sure would, because it's an extremely reasonable fee. If some borrowers fail to meet the pay-back requirement in two weeks (if that's the term) than that is their fault...not the lenders.
I agree with Scooter above that an APR on a two week loan is completely misleading. After all, APR is an acronym for Annual Percentage Rate.
With mortgages, when customers asked why the APR was higher than the "Interest Rate" (and they ALL did) we explained it like this: The APR is the cost of your credit [loan amount + fees] for the first year only, expressed as a annual rate. Hardly applicable in the case of a two week loan.
I also totally agree with MyOwnBoss!
In closing, let me ask this: if a total stranger, with bad credit, living paycheck to paycheck & then some came to you and said "If you will lend me $100 today, I'll pay you back that, plus $15.00 - two weeks from now." Would you lend it to them? I wouldn't.
Corker shaping payday loan rules in financial reform package
I am so thankful to see all the intelligent comments, FOR this industry. I'm not in the payday lending industry; I never have been, but I was in the mortgage industry for more than 20 years.
Would you pay $15 to borrow $100? I sure would, because it's an extremely reasonable fee. If some borrowers fail to meet the pay-back requirement in two weeks (if that's the term) than that is their fault...not the lenders.
I agree with Scooter above that an APR on a two week loan is completely misleading. After all, APR is an acronym for Annual Percentage Rate.
With mortgages, when customers asked why the APR was higher than the "Interest Rate" (and they ALL did) we explained it like this: The APR is the cost of your credit [loan amount + fees] for the first year only, expressed as a annual rate. Hardly applicable in the case of a two week loan.
I also totally agree with MyOwnBoss!
In closing, let me ask this: if a total stranger, with bad credit, living paycheck to paycheck & then some came to you and said "If you will lend me $100 today, I'll pay you back that, plus $15.00 - two weeks from now." Would you lend it to them? I wouldn't.