Mirosiichenko said his company would not employ debt collectors to get its money back if people refused to repay, and promised no physical violence. Signatories only have to give their first name and do not show any documents. “If they don’t give it back, what can you do? They won’t have a soul, that’s all.”
New Hampshire will become the latest state to keep payday lenders from gouging their patrons. A measure passed by the legislature will cap interest rates on payday loans at 36%, a drastic change for an industry used to bludgeoning underbanked consumers with interest rates exceeding 500%. Payday borrowers spend an average of $793 trying to repay a $325 loan. Let’s see how the economic leeches spin this as a loss for consumers.
Lazy, fat, inbred, black, pathetic, stupid, liar, thief, nigger. Those are some of the defamatory words Merchants Retail Credit Association (MRCA) used on Dolores Madduxes’ family when they tried to collect on a debt Dolores Maddux, who is dead, owed CitiFinancial. For these violations of the Fair Debt Collection Practices Act, the Madduxes sued MRCA and won $854,389.81. Even delinquent debtors have rights and it’s important to know them and call an attorney if they’re being violated.
“If it sounds like legal loan-sharking, it’s not. ‘Loan sharks are actually cheaper,” leader of the Ohio Coalition for Responsible Lending, talking about payday loans. [CNN Money]
Soldier robs two banks because he was $30,000 in debt to payday loan agencies. [Seattle Post-Intelligencer]
A debt-collection agency settled with the FTC for $1.3 million after thousands of complaints were lodged against the company for abusive and illegal practices. LTD used threatening language and racial slurs against debtors. They also threatened they would garnish debtor’s wages, something that can’t happen without a trial. Company managers were found to be complicit in its employees illegal actions. LTD collected debts for major credit card companies and retail chains.
Usury is good for you. That’s the lesson from an article in today’s WSJ using empirical evidence to defend the practice of charging 200% interest rates.
In a victory for consumers, Washington D.C. effectively outlawed payday lending today with the passage of the Payday Loan Consumer Protection Act capping lending interest rates at 24%.
“My company was deliberately targeting minority people for a continuous loan process that they would never, ever get out of. ” – Bill Harrod, Former Payday Loan Manager. [NBC4]
That’s a lady who is finally digging herself out of a payday loan hole with the help of a “non-profit” payday loan. At one point, Truckey was paying $600 a month in finance charges alone. Now she has a new loan through GoodMoney, operated by local credit union. The new loan’s APR is only 252%, about half what she was paying before.
A California reader has been getting calls from a debt collector every day and asks if there’s any limit to the amount of times a debt collector may call.
If you want to successfully challenge a charge a debt collector says you owe, you’ll want to understand the doctrine of “account stated.”
Debt collector denied unemployment benefits because he was abusive towards debtors… the same conduct that had gotten him promoted to a supervisor position within the company.
We’re not the only ones irked by the Maxed Out documentary.
Seven big payday loan chains are extensively bankrolled by brand name banks. Bank Of America, Chase, WellsFargo, U.S. Bancorp, and Wachovia all extend tens to hundreds of million dollars in lines of credit to these predatory lenders who charge several hundred percent interest on cash advances, often made to the poor and uneducated.
Maxed Out's Bombshells: 1. Wells Fargo Funds Payday Loan Chains 2. Celebrities Get VIP Credit Report Treatment
While we chided Maxed Out for not discussing consumer self-empowerment, the movie did make two very interesting claims:
We just finished watching Maxed Out, the recent documentary about the viperous evils of the credit industry. We agree with the basic premise: Underinformed debtors are getting taking advantage of. And the stories are horrific, with three different people driven to suicide because of debt. The doc does a good job of outlining the links from debtor, to bank, to debt collector, to government representatives. It’s a nasty apparatus.
The Maxed Out credit industry documentary hit DVD Tuesday.