Payday Loans And Debt Traps

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CARDIFF GARCIA, STACEY VANEK SMITH | NPR
Millions of Americans have used payday loans. These are small, short-term loans known for charging staggering interest rates — sometimes in the 300 to 400% range. While the loans can provide quick financial relief to people who need it, the loans can quickly spiral and send borrowers into a cycle of debt. The Consumer Financial Protection Bureau is responsible for overseeing payday lending — and earlier this month, it announced it was delaying changes to payday regulations. Today on The Indicator, we look at the business of payday loans, and what it's like to get into a debt cycle with payday

After Enjoying Bonanza Of Deregulation, Payday Lenders Celebrate At Trump Resort

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Jake Thomas | The Intellectualist
The Miami New Times reports that the Community Financial Services Association of America (CFSA) will host its annual conference at President Donald Trump’s golf resort in Doral this year. The CFSA, a trade group that represents payday loan companies, traditionally holds the conference in California during odd-numbered years. Sekinah Hamlin of the Center for Responsible Lending said the move is a “clear conflict of interest.” "Previously, they did not meet at his resorts, but it just so happens that once he became president, then they started meeting at his resorts. We don't think it's

Payday lending industry could see rate caps, database under legislative proposals

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Riley Snyder | The Nevada Independent
In the coming weeks, Nevada lawmakers will see thousands of bright-yellow postcards dropped into their mailboxes. The postcards, sent by members of the inter-faith group Nevadans for the Common Good, will include handwritten notes and requests for legislators to support more funding for K-12 education, affordable housing tax credits and additional restrictions on payday lending. It’s part of a renewed effort by progressive groups and community activists to enshrine new restrictions on Nevada’s payday loan industry, two years after similar efforts to rein in the industry went down in flames

Oregon AG leads push to protect student borrowers

SALEM, Ore. (AP) - Oregon's attorney general wants to better protect people who take out student loans. Attorney General Ellen Rosenblum publicly backed an initiative Monday to regulate student loan servicers like Navient and Nelnet. It would force servicers to become licensed under the state and educate students on the borrowing process. Student loan companies have been criticized for misleading borrowers into taking up costly loans. The attorney general's office says that at least 58 percent of students in Oregon graduate with debt. Outstanding student loan debt in the state has surpassed

Credit card debt-settlement services are risky and could affect your credit score

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Gregory Bresiger | New York Post
You’re hopelessly in credit card debt and considering bankruptcy. Wait — you don’t have to pay it all back, a television announcer claims. There’s “a secret that the credit card companies don’t want you to know.” This “secret” will wipe out card debts for a fraction of what you owe, promises the ad, which is for CreditAssociates, a credit card settlement company. “On average, we save our clients in excess of 55 percent of what they otherwise would owe,” CreditAssociates Executive VP Rick Burton told The Post. But critics question some debt-settlement services and their methods.

Trump-Appointed ‘Consumer Watchdog’ Trapping Americans in Debt

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Mike Calhoun | Morning Consult
Mary Schmidt, a lifelong resident of the St. Louis region, had a good job with a school district. In an attempt to cover a financial shortfall, she took out a payday loan of a few hundred dollars. Unable to afford to repay the loan principal and fee, she repeatedly reborrowed — more than a dozen loans in total. Each time, she was hit with a fee. She was “drowning” in fees far in excess of the original loan amount. The payday lender caught Mary in its debt trap. She couldn’t make her car payment, student loans or mortgage. She was short on money for food and got behind on utilities. Mary’s

Tulsa World editorial: Don't roll back rules that protect consumers from payday lending abuses

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Tulsa World
The Consumer Financial Protection Bureau should not reverse a common-sense rule that protects payday lending borrowers. This month, the bureau proposed rolling back a 2017 rule that prohibits loans to borrowers who cannot demonstrate an ability to pay them back. That essentially prevents payday lenders from intentionally making short-term loans to weak borrowers then repeatedly flipping the debt to amass extra fees. It was a high-profit racket for predatory lenders before the rule, and it will return if the rule is rolled back.

Auto loan delinquencies climbed to $9 billion in 2018

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Defender News Service
In recent months, many economists and lawmakers have frequently touted how the nation’s economy is performing really well. Often citing historically low unemployment rates, I’ve always felt that such pronouncements failed to consider the untold millions of Americans who are eking out a living on low or no raises, or others who work multiple jobs trying to piece together a living for their families. But new data from the Federal Reserve Bank of New York, offers hard evidence that a key sector of the economy is showing signs of distress: auto loans. At the end of 2018, 7 million consumers were

Trump makes predatory lending great again

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John Micek | Casper Star Tribune
Here’s another reminder that, when it comes to the Trump administration, it’s more important to watch what the White House does rather than what it says. The payday lending industry scored a huge win when the U.S. Consumer Financial Protection Bureau proposed to weaken Obama-administration rules governing an industry that makes its money by exploiting people in desperate financial straits. That’s pretty much the exact opposite of what the agency was created to do. But, hey, this is Donald Trump’s Washington.