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Do Payday Loan Debtors Have Civil Rights Under The Rules?
Payday loans borrowers have civil rights. They have got the right to know just how much their loan is going to cost them. They have the right to give back the amount they borrowed by the end of the day if they decide they changed their minds. They have the right to know concerning dispute resolution. The witty thing is they have the right to know so much, that most payday loan places will hand you a couple pages of fine print on your rights and have you sign something at the bottom saying you give up your right to a jury trial and you do so consciously. Despite the volumes of information payday loan stores give, people find themselves going to payday loan places and signing on the dotted lines anyway. It makes one wonder whether knowing is sufficient. How could one know and yet decide on something that has been compared to usury? Is it unawareness, lack of concern, or something else altogether that keeps the industry in consumers at such a rate that the business seems to be flourishing while other businesses are floundering?
To convey the matter raises questions is an understatement. It's difficult to have sympathy for an industry which seems to have flourished while the country is going through one of the toughest financial crisis in current memory. The payday loan industry has certainly profited, having become in fact, "$28 billion industry nationally, according to the Center for Responsible Lending" (Associated Press, 2007). As the industry grows, it leaves us wondering how people would readily reimburse 480 percent. Ray Fisman, in The Dismal Science, asks the question "Do people take out payday advance loans because they're worried, or since they don't understand the terms?" What Fisman almost asks but doesn't is are individuals stupid or don't they understand that one $500 loan from these establishments potentially costs them $2692 a year? These seem to be the same individuals who then blog questions like, "Is my payday loan place going to have me in prison? Are these businesses preying then on the stupid?
So far, no one is forcing them to go. Or are they? It has been suggested that our present financial crisis has made it nearly impossible for the average person to get a loan in any other way. In response to the push for more stringent borrowing practicing, traditional banks are turning away traditional borrowers. Maybe it is not a coincidental link between the push by banks to be stricter and the responsiveness of the fringe industry to grow as a conclusion. Cash loan lenders aren't stupid. Like every aggressive child, they know there is a limit to how far you can push until you get, proverbially, smacked in the head.
President Obama has made a point of stating that America, to be financially strong, must be able to have credit. If this is the case, we are looking at a new wave of Americans who have been forced out of the credit game, disenfranchiseed by a banking industry that was careless enough to loan to foolish consumers forcing mainstream America to choose an even stupider path.
Do Payday Loan Debtors Have Civil Rights Under The Rules?
To say the issue raises questions is an understatement. It's tough to have sympathy for an industry that seems to have flourished while the country is going through one of the toughest financial crisis in recent memory. The payday loan industry has definitely profited, having become
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