Comments on: Short-Term Loans Can Mean Lasting Trouble

Payday Advance Loans Seem Simple, But Can Lead To Endless Cycle Of Debt

[mandylou4u]

very bad reporting too, all the states they listed saying they are "banned", not true. I have worked at my store, in one of the states listed above, for over 13 years. Never have we been told to shut our doors. We get audited by our state and comply with all the regulations that are set on us. I just can''t wait until the people figure what''s going on with their bank and stop putting their money in one.

[mandylou4u]

tke, it''s an option, obviously you have never had money problems. This is a wonderfull option considering you have a charge from your bank and a charge from the merchant if a check doesn''t clear. I think I would much rather pay a fee for a payday loan than to pay twice that much in fees to go to a bank which does absolutely nothing for me. Did you see the guy that lost 80,000 dollars a couple of weeks ago? He had 180,000 in his account, your wonderfull banks only insure 100,000 in any given account. 80,000 lost to a bank that did nothing for you. Wonder how long he has to wait to get his money back?.

[randyp90]

Payday lenders have saved my butt on more than once. I was so greatful they were there when I needed them. I liked the product so much i went to works managing a store. You dont know how many times people have thanked me for being here. They say I was the only person that would help them. Many turn to us when they are going to bounce checks and the bank wont help them.

There are some that abuse the payday loans. They borrow more than one loan, some more than one on the same day, with no intent of ever repaying them. These people fail at all aspects of financial responsibility. It is not the lenders fault. I know we educate our customers on responsible lending. Some just refuse to listen or care. Thats why they are in financial trouble anyway.

Katy...not all of us have multi-million dollar contracts and live like queens. This is the real world and people need quick easy to get loans. You should get your staff to research things before you open you mouth. You really need to have them look at Elected officials in the pockets of big banking...attacking short term lenders.

[tke919]

I find it interesting how all the payday lending folks talk about demand and how they don''t force anyone to use their products. (I guess the email got sent around by the CFSA.)

Let''s use their logic:

We should make immediately make meth, heroin and crack legal!! I mean, there is obviously a demand, and no one forces anyone to use any of those, so it must automatically be good!

If a few families get completely destroyed in the process, so be it. Those people must obviously not have self control and, besides, look at all those who use drugs responsibly! We don''t want them to not be able to get their fix, do we?

Sounds ludicrous, doesn''t it?

[sb20503]

I fing it interesting that there is never any "Investigative Reporting" into our Country''s Banking System. We always look into 2nd or 3rd options for consumers, and decide what is fair or unfair in what they do or what costs they have to pay for specific services.

The Banking Industry is a multi-billion dollar industry, and talk about charges and costs!!! My Son has an account with Wells Fargo, and they have given him a Debit Card. He can use the Debit Card anytime he wants to, even when there are no funds, the card will go thru. Wells Fargo then charges him $30 for every transaction he goes over. While he has the responcibility to watch his account, why does the Bank allow his Debit Card to work if he is overdrawn. In 1 Month for $15.00 in 3 different transactions, which the Card was processed and accepted, Wells Fargo charged him $90.00 in overdrafts.

Think about how much Banks generate in Overdrafts, Bounced Checks, High Rate APR Credit Cards with big costs for being late, ATM Fees, etc. Add all this up, and what kind of costs/fees are the Banks making off consumers in this country.

Why not go after them, well I guess they have the strength to dictate what and who they have to anwser to, and I bet they have a concern with the Payday Loan Stores, because how much is it costing them???

Quite a share of that cash cow is my guess. So next time you want to critize Payday Loans and what they charge, just think about who owns the skyscrapers and how did they build ''em???

[shaun121-2009]

I have worked for the payday lending industry for several years and in that time I have never, nor has anyone else in my organization ever forced payday loans on anyone. We do not offer incentives to landlords and in fact we operate with the utmost integrity at all times. Every customer that walks through my doors are told the same thing, "this is a short term loan for unexpected needs, it is not meant to be a long term loan so please only borrow what you can comfortably pay back on your next payday." Many customers become upset when we do not offer them the maximum amount because we are responsible lenders and ensure that we too are comfortable that they can repay. My advice remains the same for every single person who feels as though they are "hooked"...borrow $25 - $50 less each time and you will soon be out, to which I get the same reply "maybe next time".

[megarman]

It''s funny that CBS and others target lenders with high rates instead of finding why people are going there to begin with. An industry doesn''t open 24,000 locations without huge demand.
The answer is simple, it is either a better alternative or it is the only alternative. By the way, if you don''t pay the $100 water bill, they charge $30 to re-establish service, which irronically cost more than a payday loan. . .

[blampis]

You missed it again...
Here''s the reality of Payday Lenders. A customer is short on cash and needs some help until they receive their next paycheck. Example: You are $200 short on rent. A lender gives you cash. When you get paid the next week you return to the lender to pay them back approx. $240.00, $40 of which are in fee''s. I fail to see the "predatory" issue and "cycle of debt"!? What are the other options for someone short on cash? If you bounced a check for $200, the bank would charge you $30-$35, and the merchant $25-$35, totalling $55-70 in fee''s! I never see any organization going after a bank for their charges!

[amylaticia]

I have worked for a payday advance lender for over three years. In all the time that I have been with this company, we have never gone out in the street to force people to come into our stores. When a customer walks through my door it is because he or she has free will as an adult and a human being. Every person can choose what loan to take out based on their paycheck and approval amount. I even make offers to help customers with budgets and suggest that they can take out a loan for a lesser amount than what origianally approved.
As for the states that no longer provided payday advances, why did CBS not include information pertaining to the amount of increase in number of bankruptcies and amount of bank overdraft fees in that state? Katie and CBS staff, Please see the report by the federal reserve bank of New York from November of 2007: http://www.newyorkfed.org/research/staff_reports/sr309.html

[amylove269]

I believe that without payday lending there would be no pawn shops, credit cards would have to lower there interest fee, & bank would have to lower or waive all of their interest fees & overdraft charges & bounced check fees. Payday lending is not the problem... nothing is hidden & the lenders are more than ever now eager to help in whatever way that they can. Lenders are restricted by the state & CFSA. Lenders are constantly scrutnized as loan sharking yet what makes them any different from the bank - oh, that''s right you don''t have to have a credit check! The loan is based on YOUR PAY & you borrow what you NEED not what you want to play with. Your job & good faith is the business...the state sets the fees but some even waive the first loan FREE yet still people don''t want to pay back a FREE loan of just $25 to $425 -I believe that if people were to budget their money wisely then there wouldn''t be such a need but for the people who are abusing the system with multiple loans--YOU ARE CROOKS NOT VICTIMS! This whole world is damned financially & there are bigger issues that we should be worried about. I know that without payday lending I would on occasion been in trouble without money for my car to be fixed & without groceries for my 3children. So you judge me as you like but everyone needs a little help every once in a while. No matter the cost. Payday lending should have stronger restrictions by the state.

[elliejohn-2009]

Thank you Katie for opening your mouth again about something you know nothing about. It only takes one person to complain and its a big deal, forget about the people that are helped by it. I''ve been working at a Payday Advance Company for 4 years now and I tell you never have I forced anyone to use our services. Honestly, most of the time people complain that we won''t give them enough. These places are for people with no credit and limited options. For some we are the only reason the heat stays on during the winter, the only reason some have gas and/or groceries for the week. As for the lady that had to pay back $470 then couldnt live off what she had left, its better than getting fired because you didnt have a working car huh? If you want to really make a difference do a story on Bank fee, pawn shops or credit card companies, those are your real crooks. I totally agree with genias2 and skitchen01 bring it down by $50 each time, you are by no means obligated to take the same amount as the time before.

[vadersbro]

its not an annualized loan. many states limit the number of loans a consumer can have. the consumer knows what they are entering into. who is the biggest lobbyist against payday loans? conventional banking. talk about more locations than McDonalds. interview a struggling consumer who bounces 3 or for checks a month. ask them what fees they paid and than annualize it.

[abbeyroad100]

Whatever happened to liberty and freedom to choose? Victim-hood once again excuses ones actions. That''s typical of CBS. I''m sure there were other options avaiable to this woman to pay off her loan! This is America! By the way, I am an internal auditor for payday loans (I have no axe to grind because I also audit another business), and I hear constantly how greatful our customers are for this service, saying, "I''m so glad you guys are here. I don''t know what I would do without you!" Let''s get back to liberty, and allow people to have more choices to help them selves!

[ybecker]

My brother started a new job and wouldn''t get paid for two to three weeks. He went to a pay day lender and borrowed money to get him through. As soon as he got paid he went into the pay day lender and paid his loan. He hasn''t been back but he is very supportive of the lenders. The same people who get themselves in a cycle of debt (not the lender) are the same people who max out their charge cards and never make a payment. Is that the companies fault who gave them the charge card?

[paydayloans-2009]

Payday lending is not loan sharking. We are upfront to our customers about the cost of each loan and the term of each loan. The industry even provides a comparison tool at www.cfsa.net/knowyourfee/index.html. Consumers do have other options, they can borrow money from friends and family, bounce checks, pay overdraft or late payment fees, or take out a credit card cash advance. Time and time again our customers tell us that they choose to take out a payday loan because it is the best option for them.

[falconrfy]

As always, people have the freedom of choice whether to get a loan or not. If they do not feel comfortable doing it......don''t do it.

[kseals1442]

Payday loan companies are always under attack from the Government and media but no one cares that this is the ONLY option for thousands of people. I work for a payday loan company and our customers know everything up front. Payday loan are designed to help people when they fall a little short between paydays. You should only take out what you need. The people that have a problem with payday loans are those who have never had to use them or those who have been burned because they took out too much or never had intentions of paying it back. If you are blessed enough to be able to get by in these tough times with out help, that is great! Not everyone is so lucky. If you are a middle class, working, single mom and your car breaks down and you need $200 to have it repaired what should you do? Gas is outrageous and people are worried about payday loan companies. That just does not make sence. We are here to help people and they have the entire process explained up front. There is no suprises or hiden fees. It is a simple loan meant tho help people BETWEEN paydays, and when used as it should be it works well for those who use it. I have asked my customers how they would feel if we were not here for them and they get very upset. I have had them come in after hearing news stories like this one and they are in tears because they are afraid they wont be able to get help when they need it. It isnt fair to take all of thier options away.

[rocketship5]

Come on CBS, you can do better!!!

I want to know the same:
"Why wasn''''t her question answered? What do you recommend people do if the payday loan is their only option? The industry is quite open with their expectations and does not hide anything. People know what they owe and when."

I think the question was answered.... Why don''t you air that??

[pescadore08]

Why wasn''t her question answered? What do you recommend people do if the payday loan is their only option? The industry is quite open with their expectations and does not hide anything. People know what they owe and when.

[genias2]

I forgot to add one comment to my last..I want to congratulate Mary Bates and tell her way to go....She has found a way to get her 15 minutes of fame..To be on the side of the Payday Loan Industry when convenient and to be on the opposing side for CBS when convenient..Only if we were all that smart.