Recorded cash income of families below the parameter payday loans may seem a short-term blessing pressing financial problems. Unfortunately, this form of debt management, which is not anything but a blessing, can lead to problems of long-term debt and its target market, the disadvantaged, African-Americans and the military, providing payday loan industry in the growing market.
Cost Payday loans expressed in a simple dollar value of loans, payday, $ 15 to $ 30 for a loan of $ 300 may seem small, but compared to mainstream lending rate is astronomical.
To fulfil Your Money Troubles, published by Nolo in 2006 by Robin Leonard says “Payday loans, deferred deposit loan, cash for checks – no matter what they are called, they are a very expensive way to borrow money.”
* Smart debt by Jason Rich and published by Entrepreneur Press in 2006, says “you can pay anywhere from $ 10 $ 30 for every $ 100 cashed, even if the term of the loan is only a few days. This is expressed by pairs of 300, 400 or even 1000% . In other words, with the help of payday loan in no way be considered smart debt. ”
* Internet Payday Lending, from Jean Ann Fox and published by the Consumer Federation of America in the United States in November 2004, “based on the repayment of $ 100 to $ 500 or more the cost of triple-digit interest rates, typically 390-780% annual interest rates on loans for two weeks with $ 15 to $ 30 financial costs $ 100 seconded. These loans are single payment must be submitted in full on the borrower’s next payday, usually within two weeks. ”
Growth in credit Payday The payday loan market is a growth industry in the United States and Canada.
* Payday Loan company in Canada, Andrew Kitching and published by the parliamentary information and services, research in the 2006 assessment “as 2004, there were about 1,200 payday loan stores in Canada, despite the rapid growth of the industry.”
* In the article «Payday Lending,” by Michael Stegman, published in Volume 21 diary economic outlook says “Today, there are more payday loan and check cashing stores across the country than McDonalds, Burger King, Sears, JC Penney and Target stores combined. ”
* Quantifying the economic impact of predatory Payday Loan, “says the report from the Center for Responsible Lending, CIT, Ernst,” The payday lending industry, which has virtually no ten years ago, has experienced explosive growth – from $ 10 billion in 2000 to 25 billion dollars in 2003. ”
Try Payday Loan absorption although sold as a short-term loans, loans payday, as a rule, trapping consumers in a cycle of debt.
* Data from the report of the Ohio Coalition for Responsible Lending, issued in September 2007, shows “the average payday borrower uses 7,4 loans in year one creditor. However, the evidence and empirical data available tell us many payday borrowers visited more than one payday lender per year. ”
* The financial quicksand, Uriah King and published by the Center for Responsible Lending in November 2006 stated, “industry depends almost entirely on revenue from borrowers caught in debt trap; 90-1% payday loans go to borrowers with five or more loan transactions each year .
The lending market desired Payday Payday loan operators target vulnerable low-paid workers, African Americans and the military.
In the 66 “predatory lending, and the military” Stephen graves States, articles in the Ohio State Journal chorus of troops and journalists have complained about payday lenders now Flocking for roads and strip malls near the gates of military bases to feed off staff salaries attached. ”
* Payday predatory lending traps borrowers, published in the Center for Responsible Lending in the United States, 2005, 22 000 payday disproportionately located near military bases and African neighbourhoods, shops, credit, operating throughout the country. These stores give rise to excessive interest charges on working families to 15 million a year. ”
Consumers should beware of attraction and fast decisions, provided loans payday. Payday loans are not debt problems, often they are the means to cycle a long-term debt and, as such, consumers with an addiction to payday loan you should consider consolidating the loans as a means to break the vicious circle of debt loan payday.