Wednesday/April 23/2008
A study by the Federal Reserve Bank of New York concluded that payday loans are "not predatory" and may actually improve the lives of the people who use them.
“To the contrary, the report concludes that payday lenders may actually enhance the welfare of households by increasing the supply of credit,” said Darrin Andersen, president of the Community Financial Services Association of America.
Some key conclusions of the study:
“[Credit]...delinquency rates were marginally lower for risky households in states with unlimited payday loans.”
“Households with uncertain income who live in states with unlimited payday loans are less likely to have missed a debt payment over the previous year.”
“In the end, the simple fact that payday lenders have triumphed over pawnshops suggests that payday lending raises household welfare by providing a preferable alternative.”
Related Story
Thursday, May 1, 2008
Wednesday, March 26, 2008
NEW PAYDAY LOAN BILL PASSES FIRST SENATE TEST
Good news for borrowers: the U.S. Senate has given initial approval to proposed legislation which would make interest rates on payday loans more attractive than ever.
House Bill 1310 would cap rates on cash advances -- as well as limit the transaction fees charged to consumers. The proposed bill also would keep borrowers from extending their loans repeatedly, or taking out multiple loans, both of which make repayment a lot tougher to manage for the consumer.
The bill now goes to the Senate Appropriations Committee for consideration, before returning to the Senate for final approval.
Related Story
House Bill 1310 would cap rates on cash advances -- as well as limit the transaction fees charged to consumers. The proposed bill also would keep borrowers from extending their loans repeatedly, or taking out multiple loans, both of which make repayment a lot tougher to manage for the consumer.
The bill now goes to the Senate Appropriations Committee for consideration, before returning to the Senate for final approval.
Related Story
Tuesday, March 25, 2008
WHEN APPLYING FOR CASH, BE SURE TO TAKE DUE DATE INTO ACCOUNT
There are a variety of factors to consider when applying for a payday advance, such as lending fees and APRs. However, don't make the mistake many borrowers do, and ignore the due date.
Most payday lenders offer a two-week repayment term; still, some borrowers are unable to repay the money within that time period. That's not good -- failure to repay by the stated repayment date results in additional service charges plus a higher interest rate going forward.A lot of borrowers suffer the consequences because they're unaware they can contact the lender about extending the repayment period. If you feel you won't be able to pay back your advance within the two-week period, immediately talk to the lending agent: you may be able to buy another week or two without suffering severe penalties.
Related Story
Most payday lenders offer a two-week repayment term; still, some borrowers are unable to repay the money within that time period. That's not good -- failure to repay by the stated repayment date results in additional service charges plus a higher interest rate going forward.A lot of borrowers suffer the consequences because they're unaware they can contact the lender about extending the repayment period. If you feel you won't be able to pay back your advance within the two-week period, immediately talk to the lending agent: you may be able to buy another week or two without suffering severe penalties.
Related Story
Tuesday, March 18, 2008
CHRISTIAN BORROWERS SHOW FAITH IN PAYDAY LOANS
According to Forbes Magazine, areas with large concentrations of Christians are the "Promised Land" for payday lenders.
The magazine's website cited a study that portrayed such areas as the Southern Bible Belt as hotbeds of payday loan lending. The study claimed a "strong correlation between the number of payday lenders within a geographic area and the political power of conservative Christians within a state."
According to SmartMoney, industry analysts estimate that 19 million U.S. households used a payday loan in 2006. This number is sure to grow this year as more Americans look to such advances to address their immediate cash needs.
Another factor: the realization that "regular" bank lending may be restricted as a result of recent trouble in the credit markets.
Related Story
The magazine's website cited a study that portrayed such areas as the Southern Bible Belt as hotbeds of payday loan lending. The study claimed a "strong correlation between the number of payday lenders within a geographic area and the political power of conservative Christians within a state."
According to SmartMoney, industry analysts estimate that 19 million U.S. households used a payday loan in 2006. This number is sure to grow this year as more Americans look to such advances to address their immediate cash needs.
Another factor: the realization that "regular" bank lending may be restricted as a result of recent trouble in the credit markets.
Related Story
Monday, February 25, 2008
CASH ADVANCE NEWS
LATEST CASH ADVANCE NEWS
Monday, February 25, 2008
PAYDAY LOANS FAST BECOMING A MIDDLE-CLASS FINANCIAL TOOL
A story in the Norfolk Virginian-Pilot described how payday loans have become popular with a surprising new group: middle-class suburbanites. Payday loans have traditionally been seen as a crutch for low-income consumers, and lenders perceived as predators taking advantage of their needy situation. In fact, payday lenders are now targeting "good, hard-working, middle-class people" with median incomes of $30,000 or more.
One local resident, a pipefitter, routinely paid off one loan before taking out another to cover bills. In this manner he was able to avoid the high interest costs associated with borrowers who failed to meet their repayment obligations on time. It appears payday lending to the middle class is a trend that's here to stay.
Monday, February 25, 2008
PAYDAY LOANS FAST BECOMING A MIDDLE-CLASS FINANCIAL TOOL
A story in the Norfolk Virginian-Pilot described how payday loans have become popular with a surprising new group: middle-class suburbanites. Payday loans have traditionally been seen as a crutch for low-income consumers, and lenders perceived as predators taking advantage of their needy situation. In fact, payday lenders are now targeting "good, hard-working, middle-class people" with median incomes of $30,000 or more.
One local resident, a pipefitter, routinely paid off one loan before taking out another to cover bills. In this manner he was able to avoid the high interest costs associated with borrowers who failed to meet their repayment obligations on time. It appears payday lending to the middle class is a trend that's here to stay.
Thursday, February 21, 2008
Cash Advance Frequently Asked Questions
Q: I've heard of payday loans described as numerous different terms. What are the differences?
Payday loans are also known as cash advance, short term loans, payday advances, cash loans, fast cash, fast loans, bad credit loans, deferred deposit, and a number of other things. No matter what you call them, payday loans can help get you through a temporary financial difficulty.
Q: I would like to get a payday loan. How do I receive my cash?
The payday loan / cash advance is usually deposited directly into your bank account.
Q: What is the loan approval process?
Once you have completed the application, you may be connected with a lender that matches your needs. Based upon information you provide in the application, each lender will determine whether or not they can offer you a cash advance. If you are pre-approved, you will be forwarded to the lender’s web site. If you are not pre-approved, we will try to present you with an opportunity to apply at another web site for a cash advance or similar product.
Q: I have finished the application. When will the money be in my bank account?
Depending on the lender that you qualify for, the money can be in your account in as little as one day. You will be contacted by email or telephone shortly after you apply with follow-up from your lender.
Payday loans are also known as cash advance, short term loans, payday advances, cash loans, fast cash, fast loans, bad credit loans, deferred deposit, and a number of other things. No matter what you call them, payday loans can help get you through a temporary financial difficulty.
Q: I would like to get a payday loan. How do I receive my cash?
The payday loan / cash advance is usually deposited directly into your bank account.
Q: What is the loan approval process?
Once you have completed the application, you may be connected with a lender that matches your needs. Based upon information you provide in the application, each lender will determine whether or not they can offer you a cash advance. If you are pre-approved, you will be forwarded to the lender’s web site. If you are not pre-approved, we will try to present you with an opportunity to apply at another web site for a cash advance or similar product.
Q: I have finished the application. When will the money be in my bank account?
Depending on the lender that you qualify for, the money can be in your account in as little as one day. You will be contacted by email or telephone shortly after you apply with follow-up from your lender.
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