New University of Michigan survey finds payday borrowers
Arizona and Ohio voters face deceptive industry ballot initiatives Tuesday
Center for Responsible Lending
November 3, 2008
Payday lenders have long argued that their loans are helpful to people who can’t quite make it to their next paycheck, but research from the Center for Responsible Lending, based on data from state regulators and the payday lending industry itself, finds that payday borrowers typically end up having to renew their loans many times per year, paying more interest for a principal that doesn’t go down.
Dr. Barr presented the survey results to the Federal Trade Commission last Thursday, in a presentation concluding that alternative financial services like payday lending and other high-cost loans are “not well-designed to serve low- and moderate-income households.” Barr said excluding lower-income households from lower-cost systems leads to economic inefficiency, is costly for low-income households, and “promotes dis-saving.” The survey was a random, stratified sample of 1003
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About the Center for Responsible Lending
The Center for Responsible Lending is a nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices. CRL is affiliated with Self-Help, one of the nation's largest community development financial institutions.