Here’s a perfect example of what a ripoff rent-to-own or “lease-purchase” (to use the Kelly’s phrase) arrangements are to the consumer. This $250 Wii console can be yours for only $79 a month, and after 12 months, it’s yours to keep. By that time, you will have paid $948 for it. By comparison, if you charged it to a credit card with 18% interest, you could pay $23 a month and have it paid off after 12 months. Kelly’s offer will cost you $673 more than paying with the credit card.
A law professor and associate professor of geography set out to create the most comprehensive map of U.S. payday lenders to date. What they found, to their surprise, was “a surprising relationship between populations of Christian conservatives and the proliferation of payday lenders.” And it’s not a side effect of a poor population that happens to be Christian, according to the authors: “Our research showed that the correlation between payday lenders and the political power of conservative Christians was stronger than the correlation between payday lenders and the proportion of a population living below the poverty line.”
Last fall, CenterPoint Energy—Minnesota’s largest natural gas supplier—announced it was considering reporting the payment histories of its customers to credit reporting agencies in an effort to reduce delinquencies.
We know that technically it’s a great thing that you have multiple options to pay for your food at Burger King, but this is just a little too sign-of-the-times, and it makes us sad. Somewhere out there is a guy who’s still paying off the Whopper he ate in June.
The One Laptop Per Child’s “Give One Get One” 2-week sale starts today. $400 buys you a cutting edge (if oddly cheap-looking) laptop and pays for another one to be given to a poor kid elsewhere in the world. [OLPC]
The forthcoming XO laptop’s price has officially hit $200 now—double the initial $100 target. [Reuters]
If you’re poor, maybe you just shouldn’t have a winter this year. Government energy officials have announced that prices this winter for heating oil, electricity, propane and natural gas will all be at record highs: 28% more for heating oil, 30% more for propane, 7% for electricity, and 5% for natural gas.
As if the American poor don’t suffer enough, now it turns out trying to get a leg up may only backfire. Yesterday, the National Center For Policy Analysis warned of catastrophic financial problems for poor people who save money. The Los Angeles Times story on the study explained that “each $1 saved by a single mother earning $15,000 a year would cost her $2.60 in higher taxes and lost government benefits.”
The 70-year-old Lisle woman was kicked out of the Starbucks in downtown Glen Ellyn a few weeks ago. She claims it was because employees mistook her as a homeless person, part of a purge the store waged to mollify customers who complained that the coffee shop was overrun with the homeless.
Do payday loan centers target minorities? If there’s any doubt in your mind, consider an instructional course offered by the Community Financial Services Association of America (CFSA,) a payday loan trade group. The couse is titled, “Building Community Support: Strategies for Business Survival.”
According to Virginia Delegate Jennifer L. McClellan, “There are over two payday lending stores for every McDonalds in Virginia and three for every Starbucks.”
A blogger from Lansing Michigan decided to spend only $30 on food for the month of November, just to see what it was like being poor. It’s an interesting read.
An American preacher on Crusade [sic] in Africa offers an unusal come-on to Lesotho’s poor: he cures AIDS.