House OKs payday lending caps

COLUMBUS: One of the nation's strictest proposed crackdowns on payday lending cleared the Ohio House on Wednesday, backed by Republicans and Democrats who believed the protection of consumers would far outweigh ...

[just me]

they need to be out of business,they are taking advantage of people who cannot afford it

[Jerry Dean]

This is a very bad law! The banks will stick me with a $35.00 charge if I am even one dollar over my balance. Now if I see I am running close I can run down to a payday loan place and get $100.00 for only a $15.00 fee. I bet the banks really support this since a $35 fee on a $1 overdraft is a really good interest rate for the banks. I think a $15.00 fee for a $100.00 advance is a lot better than a$35.00 fee for a $1.00 loan which is what banks charge. If this law passes I will have no alternative to getting stiffed by the banks if I get in some trouble between paydays!

[Cynic]

Why not calculate the APR for the $35 fee on the $1 loan and ask your representatives to go after the banking industry for predatory lending?

Or is the Ohio General Assembly a wholly owned subsidiary of KeyBank?

[Pachacutec]

Believe it or not, it's extremely easy to get caught in the PDL cycle. I always thought I was a fairly intelligent person, however..... At any rate, I think this is a great law, the PDl's need to be put out of business!

[Alexandra]

It's not like people don't know about the interest rate when they borrow.

If you stick to a budget, you shouldn't need their services...at least not a whole lot. It's good for if you need $200 NOW but won't have it until next week, that's about it.

[Where will Preacher]

Ted get his money, now??

OH yeaH---State keno, state, lotto and closing down the state mental hosptals, raiding the tabacco fund...not to worry gamblin' is comin'

[I agree]

I agree that they should also be going after the banks who charge $35 if you go over a penny, that's predatory as well...

[Sharon Seiling]

I applaud the courage of legislators from both sides of the aisle to take such a strong stand against abusive practices by the payday lending industry that harm the most financially vulnerable families. The Ohio Coalition for Responsible Lending has done much to highlight the need for curbs on interest rates and by doing so has provided a great service.

[Martha A Crowder]

Per this articles statement "The high interest rate is the anchor that takes many Ohioans deeper into the sea of bebt" Are we to to believe then, that the interest rates charged by the credit card companies will also receive the same investigating the payday lending companies have received ? Payday lending companies go by "APR" - if you convert the credit card companies & the banks interest rates to APR what do you find ? Why go after one industry & not the rest ??? Please address this. Many people are interested in the answer to this question.
Thank you.

[Pachacutec]

$15 per $100 sounds pretty good, but when you add it up over time..... Especially if we're talking about the internet PDLs, even if you've more than paid off your loan, they will continue to bleed your checking account w/ automatic debits. If you want to read some real horror stories about PDLs OR if you're caught up in the PDL "web," please visit debtconsolidationcare.com and check out their "getting out of PDL" forum.

[Relieved]

Jerry Dean wrote:

This is a very bad law! The banks will stick me with a $35.00 charge if I am even one dollar over my balance. Now if I see I am running close I can run down to a payday loan place and get $100.00 for only a $15.00 fee. I bet the banks really support this since a $35 fee on a $1 overdraft is a really good interest rate for the banks. I think a $15.00 fee for a $100.00 advance is a lot better than a$35.00 fee for a $1.00 loan which is what banks charge. If this law passes I will have no alternative to getting stiffed by the banks if I get in some trouble between paydays!

I will be relieved, once the payday loan abuse is over! The average payday borrower goes through the 2-week process 12 times in a year (industry figure)and takes two years to escape the trap. Most people who need an emergency payday loan of, let's say,$500 will NOT have $575 two weeks later. They are most likely to borrow $600 from another payday lender (ever notice how close many of them are clustered?), but will NOT be in a position to pay back $690 two weeks later -- and so the dance goes on. Why don't you get a loan with a credit card, which costs you a great deal less? If you cannot budget within the limits imposed by a credit card, going to a payday lender will not be a lasting solution.
Relieved

[just me]

Relieved wrote:

<quoted text>
I will be relieved, once the payday loan abuse is over! The average payday borrower goes through the 2-week process 12 times in a year (industry figure)and takes two years to escape the trap. Most people who need an emergency payday loan of, let's say,$500 will NOT have $575 two weeks later. They are most likely to borrow $600 from another payday lender (ever notice how close many of them are clustered?), but will NOT be in a position to pay back $690 two weeks later -- and so the dance goes on. Why don't you get a loan with a credit card, which costs you a great deal less? If you cannot budget within the limits imposed by a credit card, going to a payday lender will not be a lasting solution.
Relieved

you hit the nail on the head,it took me three years to get out of the trap,I get calls all the time from some of them trying to lure me back,I would never even take one every again not even if it was to buy gas for my car

[Ryan]

just me wrote:

they need to be out of business,they are taking advantage of people who cannot afford it

So are credit card companies, but I don't see the government moving to put them out of business.

[Ryan]

Cynic wrote:

Why not calculate the APR for the $35 fee on the $1 loan and ask your representatives to go after the banking industry for predatory lending?
Or is the Ohio General Assembly a wholly owned subsidiary of KeyBank?

Excellent point. I've been nailed for the $25 and $35 fees before because I've been a few pennies overdrawn due to failure to properly subtract numbers after a debit card purchase. The banks show no mercy when this happens.

[Gedrik]

Another slap to people that need help and have no other place to go. Go to a bank for a short term loan? They will show you the door real quick. Aks Tom Allio, the jerk that helped push this, and works for the Catholic mafia in NE Ohio if he or his catholic gang will help you out in a sticky financial situation.

Generally those that use the PDLs can't get a loan, or any help anywhere else.

So you people that have "advice" such as get a credit card loan or learn to budget, try walking in another man's shoes just once. Get off your high horse and actually give some help---oh, i forget, it is un-amerikan to help, it is better to just criticize.

Trapped in this sorry state of Ohio.

[Ryan]

Relieved wrote:

<quoted text>
I will be relieved, once the payday loan abuse is over! The average payday borrower goes through the 2-week process 12 times in a year (industry figure)and takes two years to escape the trap. Most people who need an emergency payday loan of, let's say,$500 will NOT have $575 two weeks later. They are most likely to borrow $600 from another payday lender (ever notice how close many of them are clustered?), but will NOT be in a position to pay back $690 two weeks later -- and so the dance goes on. Why don't you get a loan with a credit card, which costs you a great deal less? If you cannot budget within the limits imposed by a credit card, going to a payday lender will not be a lasting solution.
Relieved

This sounds like annecdotal information to me, rather than facts supported by stats. How do you know that "most" people won't be able to repay these loans on time?

Who are you to tell someone who they can borrow from and at what rate?

I admit, I hate pay day lenders, just like I hate banks and credit card companies. But I don't support driving them out of business. I would rather support widespread financial education to encourage people to avoid pay day loans and credit cards.

[Scooter Moonpie]

PDL HAS to be lucrative... look at how many there are locally, state-wide. Legal loan sharking without the bullet holes in the knees.

[AppleJack]

The process, folks is IF you borrow as little as $100 for a week or two, the fees are reasonable. The PROBLEM is if you need significantly more money - or if your week or two turns into 3 or 4, the rate increases to the point you likely can't make the payment. As you move from one payday source to another to pay the previous one, the balance grows astronomically and and your caught in the loop.

1. If a person can't borrow the first 100 from a better source - not paying that specific bill is better than getting into the payday loan cycle.

2. I have to admit I'm shocked at those of you that have a viewpoint no better than a 1920's Mafia Dom.

[Lori]

There are good points and bad points to what they are trying to do. Although as an employee of one of these Payday Lending Companies I would like to know who is going to buy my newborn baby's formula when this new law has shut down my place of employment? Don't tell me that government assistance will be available for me, because I don't believe that with all the jobs this will eliminate that government assistance will be there to help. I can understand putting restrictions on the industry, but completely wiping it out isn't going to help anybody. I guess when I no longer have a job I will just write to the Senators and House Representatives and ask them to mail me a check to buy my baby food.

[Oh Yes]

Its a start. If people want to use PDL, thats their business. They know up front what the interest rates will be.