There are few things more disruptive and frustrating than receiving a phone call demanding you pay a debt. Those feeling are amplified a thousand times when you don’t actually owe a debt. Yet, that was the case for consumers contacted by a Georgia-based company that was recently shut down at the request of the Federal Trade Commission. [More]
payday loans
FTC Helps Stop Debt Collection Operations Attempting To Solicit Allegedly Fake Payday Loan Debts
By 7.1.14
Bank Of America Agrees To Scan For Illegal Payday Lenders In NY
By 6.16.14
Payday lending is illegal in more than a dozen states, including New York, but some lenders manage to fly under the radar by operating online or hiding their loans as part of another business. In an effort to crackdown on loans that violate state laws, New York has created a database for banks to use to help identify sketchy lenders, and Bank of America — no stranger to the issue of questionable loans — is the first to sign on. [More]
This Is One Of The Scammiest Payday Loans We’ve Ever Seen
By 6.4.14
Many payday loans have confusing terms and questionable fees that end up costing the borrower a lot more than they’d planned on when they took out the short-term loan. But it’s mind-boggling how one predatory lender managed to squeeze money from borrowers through an automatic opt-in renewal program that turns a $300 loan into $975 worth of payments in only a few months. [More]
SCOTUS Decision Proves States Have Power Over Payday Lenders Claiming Tribal Affiliation
By 5.29.14
While a U.S. Supreme Court decision yesterday in the case of a Michigan Native American tribe’s allegedly illegal casino appears to have nothing to do with payday lending, experts say it’s a game changer in states’ efforts to rein in the often predatory industry. [More]
CFPB Report Confirms Payday Lenders And Debt Collectors Are The Worst
By 5.22.14
For decades, payday lenders and debt collectors did their work while being largely ignored by federal financial regulators. And a new report from the Consumer Financial Protection Bureau, which recently gained oversight authority over the largest of these businesses, calls out many of the sketchy, sometimes illegal, practices some in these industries have been getting away with for far too long. [More]
Payday Lenders Can’t Use Tribal Affiliation To Garnish Wages Without Court Order
By 4.11.14
For years, a handful of sketchy payday lenders have been using purported affiliations with tribal lands to try to skirt federal and state laws. But courts and regulators have recently been cracking down on these operations, saying that a tribal connection does not shield a business from prosecution. One operation facing charges from the Federal Trade Commission has now agreed to pay nearly $1 million in penalties over charges that it illegally garnished borrowers’ wages and wrongfully sued them in tribal courts. [More]
Believe It Or Not, Outlawing Payday Loans Will Not Lead To Looting & Pillaging
By 4.6.14
Critics of payday lending say the practice traps many borrowers in a debt spiral, forcing them to take out additional loans to pay back the first. Yet these short-term loans do have proponents (many of them profiting from the industry) who claim that without this pricey option for quick cash, desperate consumers will turn to more unsavory means, leading to increased crime rates and other doom and gloom predictions. But does that really happen? [More]
CFPB In “Late Stages” Of Working On Rules To Stop Predatory Payday Lending
By 3.25.14
Lisa took out a payday loan to help pay her rent. When she couldn’t repay the loan after 14 days she rolled it over, bringing her total debt to $800. After repaying more than $1,400, she remains stuck in the revolving door of debt associated with payday lending. It’s stories like these that the Consumer Financial Protection Bureau aims to stop with new rules to regulate the payday loan industry. But those in the payday industry say Lisa should have simply known better. [More]
4 Out Of 5 Payday Loans Are Made To Consumers Caught In Debt Trap
By 3.25.14
The revolving door that is the payday lending debt trap is real. The high-interest, short-term loans may even be more damaging to consumers that previously thought. Four out of five payday loans are rolled over or renewed every 14 days by borrowers who end up paying more in fees than the amount of their original loan, a new Consumer Financial Protection Bureau report finds. [More]
Feds Investigating That MoneyMutual Company With The Montel Williams Ads
By 3.13.14
If you’ve caught any daytime or late-night TV in the last few years, you’ve probably noticed talk show host Montel Williams shilling for a service called MoneyMutual that connects needy borrowers with Payday lenders. Newly released documents show that the company’s lead-generation process is under investigation by the federal Consumer Financial Protection Bureau. [More]
States’ Attempts To Reform Payday Lending Are Often Just Smoke & Mirrors
By 3.12.14
Payday lending has been getting a makeover of sorts recently. A number of banks, including Wells Fargo, have discontinued their payday-like direct deposit advance programs after federal regulators tightened their guidance over the high-cost products. Now, a number of state legislatures are discussing payday lending reform bills, which they say will make short-term loans safer for consumers. But are they truly helpful to those who need them? Not quite, say consumer advocates. [More]
RISE Credit: A Safe Short-Term Loan Option Or A Payday Wolf In Rocky’s Sweatshirt?
By 2.12.14
Consumers looking for relief from the cycle of debt often associated with the use of payday loans may have seen the light at the end of the tunnel with RISE Credit. The products billed as the next generation in financial products has it all – a true American hero featured in its ads and the promise to give you a financial comeback. [More]
And Then There Was One: Wells Fargo, U.S. Bank Discontinue Payday Loan Products
By 1.17.14
The small victories are adding up in the battle against predatory loans this week. Wells Fargo and U.S. Bank announced they will discontinue high-risk payday lending programs. [More]
Banks That Market To & Serve Military Also Tacking On Huge Fees
By 1.16.14
One might assume that banks marketing to U.S. military servicemembers would not be out to nickel and dime these men and women with unnecessarily high fees on their accounts. But among those financial institutions levying the highest level of fees on its account-holders are several that not only market to the military but also have branches on military bases. [More]
A Small Victory Against Predatory Lending? Regions Discontinues Payday Loan Product
By 1.15.14
It’s only a small victory in the battle against predatory loans, but there’s now one less bank offering a high-risk payday lending product to consumers. Regions Bank has closed the door on its payday loan-esque deposit advance product. [More]
CashCall Tries To Collect On Illegal Payday Loans, CFPB Says “Nice Try”
By 12.17.13
Collecting a debt from people who owe money is one thing. Collecting a debt from people who don’t legally owe because those loans should never have been written in the first place? That’s another problem altogether, and the Consumer Financial Protection Bureau is very upset with one company . [More]
How Does A $1,000 Loan Blow Up Into $40,000 Of Debt?
By 12.13.13
We’ll never advise that anyone take out a payday or installment loan with an interest rate of 240%, but if you do find yourself taking out one of these ridiculously high-interest loans, know that defaulting on the payments can land you in the courthouse, where you could end up buried beneath a mountain of debt from which you’ll never dig out. [More]
