Should Online Payday Lending Be Regulated - 819 Words

Should Online Payday Lending Be More Closely Regulated? Should Online Payday Lending Be More Closely Regulated? Payday loans generate lots of controversy because they re offered to people who have bad credit or limited credit histories, which makes them high-risk borrowers. Traditional lenders seldom approve loans for these types of borrowers and never quickly enough when a cash emergency occurs. Unfortunately, many of these same people don t use payday loans as intended -- as short-term emergency loans just until their next paydays -- so they become trapped in a cycle of debt. Well-meaning consumer activists, politically motivated legislators and establishment figures from the traditional banking industry band together to push for reforms to regulate payday and other short-term loans more closely. Both sides of the controversy make some valid points, according to an LA Times article. Some short-term lenders do use deceptive advertising and target financially unsophisticated borrowers to trap them in debt cycles where interest rates average annual percentage rates of 400 percent or more. Of course, traditional lenders also target people who have the best credit and offer them introductory deals on credit cards. Check any middle-class group in the United States, and the chances are that most of these families juggle a mountain of debt for mortgages, credit cards, car loans and student educational loans. Even though these loans carry lower interest rates, they can be justShow MoreRelatedPayday Loans : A Cash Advance3714 Words   |  15 Pages Payday loans, which are also sometimes called a cash advance, is a short term loan that is due on your next payday. They generally have three features; they tend to be for smaller amounts, are due on your next payday, and require you to give the lender access to your checking account or to write a check for the amount due in advance that the lender has the option of depositing when the loan comes due. Payday loans are intended to be an option to people who are faced with meeting immediate deadlinesRead MoreMultiple Loans Options Of Banks That Offer Personal Loans Essay2182 Words   |  9 Pagesaccordance of your requirement, you should choose any of them. If you approach to any loan experts who are in touch with those banks that offer personal loans, then it will be a great help for you. Various kinds of personal loans dealt by banks †¢ Installment loans can cater you the privilege of making small repayments in parts or installments for a set tenure. This form is really quite helpful for low-income fellows who cannot afford giving bulk repayments. †¢ Though payday loans are not properly treatedRead MoreSmall Loans Come Under Heavy Fire1272 Words   |  6 Pagesalready regulates most financial products and caps interest rates for certain loans, but legislators allow lenders of small loans for bad credit to charge higher rates so that they can make enough profit to stay in business. Small loans are already regulated and monitored by the state by the Small Loans Act and Deferred Presentment Services Act. Alabama Senate Bill 284, which is being considered by the Alabama Senate, would impose interest caps on loans over $2,000, which are currently unregulated asRead MoreHow A Small Business Loan With Bad Credit2621 Words   |  11 Pagesor credit card receivable financing. The CCRF is a cost-effective alternative and it is a completely new type of true regulated business loan with features including: †¢ 50% to 80% low factor or interest rates †¢ Use of same credit card processor †¢ No points or fees upfront †¢ No contract in regards to the purchase of equipment †¢ Pre-approved loan within 48 hours †¢ Credit score should not be less than 550 †¢ Funds are available within 7 to 10 working days Secured Small Business Loans with Bad Credit TheRead MoreSubprime Lending1295 Words   |  6 PagesDefining Subprime Lending The problem to be investigated is the effect of subprime mortgage loans on the economy. According to Merriam Webster subprime is defined as having or being an interest rate that is higher than a prime rate and is extended especially to low-income borrowers; extending or obtaining a subprime loan (Webster, 2012). Subprime mortgage loans are loans given to people with a low credit score. Subprime borrowers normally don’t qualify for prime loans or prime lending. AccordingRead MoreWgu Capstone8760 Words   |  36 PagesWhy Information Security Management Is Important For Payday Lending Business Laquinta Denise Mason A Prospectus Presented to the Information Technology College Faculty Of Western Governors University In Partial Fulfillment of the Requirements for the Degree Master of Science in Degree Area 3/14/2014 Abstract The purpose of this project was to ensure the client is compliant with the requirements specified by the Grahm-Leach-Bliley Act. Information is whatRead MoreFinancial Market Institution17199 Words   |  69 Pagesa mutual fund that invests in Chinese securities. It is important to recognize that at the most fundamental level well-functioning markets and institutions are based heavily on trust. An investor who deposits money in a bank, buys stock through an online brokerage account, or contacts her broker to buy a mutual fund places her money and trust in the hands of the financial institutions that provide her with advice and transaction services. Similarly, when businesses approach commercial or investment