Pay day loans have been targeted by Congress in its financial reform bill. People wonder why something that is there to help ordinary people would be targeted by a financial reform bill intended to stop the crimes of filthy rich Wall Street bankers. The fact that pay day loans are part of the financial reform bill shows that the cash industry is looked on poorly by bankers, politicians, and a lot of overpaid people with cushy jobs who vote. Most of the time, the rest of us feel the same about payday loans. But if you’ve ever used a pay day cash advance, for any good reason, you were probably glad you could get one.
When you need credit the most
Payday lenders provide a lifeline to people that nobody else will. Payday advances can help people start building a good credit and get themselves out of financial jams. Greedy banks and wealthy speculators that triggered our most recent recession have made life very difficult for most Americans. It is being made worse as they ensure credit is nearly impossible for the average person to receive. Even when times are better, the more you need credit, the harder it is to get. People who make plenty of money to live on and then some get invited to borrow money by banks every day.
Pay day loans under fire
What is interesting about this financial reform bill is the politicians aren’t going after lenders. They are actually going after the borrowers. They have decided to try and limit lenders to six loans in a twelve month period. Another provision would require lenders to offer extended repayment plans, which they already do with installment loans. The Salt Lake Tribune reports that a counter proposal has been submitted to exempt payday lending from federal oversight, so it’s unclear whether the six-loan limit measure will succeed.
Responsibly lending payday loans
Federal regulators want to go after pay day lenders. But the industry promotes its best practices with the Community Financial Services Association of America. CFSA member companies are required to comply with Industry Best Practices to ensure consumer protections and responsible payday lending to all of the customers. Another group that is committed to preserving access to short term credit for Americans is the Online Lenders Association. Before you arrange your cash til payday loan, make sure your money lender is a member of either the CFSA or the OLA.
Survival of debt responsibly
Pay day loans could make all the difference in debt survival. You can make sure to have your bills paid before your next paycheck. If that’s not possible, consider an unsecured personal loan for debt survival. If you have an unsecured personal loan, you may be able to pay your loan back with monthly installments rather than with one check. Be sure to take advantage of the resources provided to consumers by the CFSA and the OLA. The CFSA will give tips on making budgets, saving money, and building credit. The OLA offers you a great step-by-step approach on how to use pay day loans the right way.
Citations
The Salt Lake Tribune
http://www.sltrib.com/D=g/ci_15072133
Community Financial Services Association of America
http://www.cfsa.net/index.html
how to use pay day loans the right way
