This last Sunday, February 8, Harry Cato published an article for the Herald-Journal in reference to a current house bill regarding payday loans. The reform bill sets up a set of rules that payday lenders must operate under.
Some of the limits include limiting consumers to on loan at a time, restricting the amount a consumer can borrow at a given time, offering an extended payment plan with no additional feels, and instituting stricter licensing requirements for Internet lenders.
Check City has already implemented some of these types of restrictions for their consumers. Check City realizes that the services rendered here are important for those who need them, but also want to be of service to the customer by encouraging smart borrowing.
Cato points out that a payday loan is sometimes the only option for some consumers who encounter an emergency expenditure. Banks and credit unions usually don’t offer the same type of loans payday lenders do, which are generally low-dollar, short-term loans for consumers with weak credit histories.
Payday loans are a valued credit option for many people. Taking that service away entirely would prove to be a stumbling block and hindrance for the credit and lending community. Representatives for states often feel like they need to “protect” consumers of these loans. Finding a proper balance of legislation that is fair to the lender and satisfactory to the politicians is essential to creating an amiable environment to “allow for a spectrum of financial choices” for citizens.
Payday loans can provide a viable source of lending for consumers who really need it.
