VIDEO: Problems with payday loans


FAMILIES LIVING PAKCHECK TO PAYCHECK ARE FALLING INTO ABUSIVE DEBT TRAPS. THAT’S ACCORDING TO ANALYSIS OF DEBT BY THE FEDS. YES. LISA JOHNSON TOOK OUT A SHORT-TERM LOAN TO GET HER THROUGH UNTIL PAYDAY. I DID IT ONE TIME AND I HAD TO PAY THAT MONEY BACK. PAYLENDERS HAVE BEEN ACCUSED OF — PAYDAY LENDERS HAVE BEEN ACCUSED OF DRIVING PEOPLE INTO MORE DEBT. THEY’RE BEING SET UP TO TAKE OUT LOAN AFTER LOAN AFTER LOAN. A DEBT ANALYSIS OF COMPLAINTS FOUND THAT 91% INVOLVED PREDATORY DEBT COLLECTION PRACTICES. WE LOOKED THROUGH THE COMPLAINTS AND FOUND ONE FROM A SINGLE MOTHER IN OKLAHOMA SHE TOOK OUT A $600 PAYDAY LOAN. SHE WAS SHOCKED TO FIND A TRIPLE DIGIT INTEREST RATE. IN HER WORDS SHE SAID HAD SHE KNOWN SHE WOULDN’T HAVE TAKEN OUT THE LOAN. NOW THEY’RE TALKING ABOUT FEDERAL RULES THAT MAY END THIS. THEIR REPORT SHOWS THE RULES SHOULD BE STRONGER. THEY SAY THERE’S A LOOPHOLE THAT WOULD ALLOW COMPANIES TO MAKE SIX LOANS A YEAR BEFORE VERIFYING INCOME. ONE LOAN IS ENOUGH TO GET YOU IN TROUBLE AND STUCK IN THE DEBT. LENDERS SO THE PROPOSED RULES WOULD FORCE BUSINESS OWNERS TO CLOSE UP SHOP.

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