Arizona options
July 13, 2010 | Arizona, industry, regulation | Comments (0)The one option this NPR story leaves off the list is that payday loan stories will close.
Comment of the Day
July 10, 2010 | Arizona, federal legislation | Comments (0)From a heated debate going on in the comments section of a Huffington Post story on lenders leaving Arizona:
I’ve taken out a payday loan twice in my life and had no problem paying it back. It was cheaper than overdrafting my bank account.
Arizona update
July 9, 2010 | Arizona, industry | Comments (0)If the pattern holds true, reporters will now start doing stories about customers who need payday loans but can’t get them. From the story:
Advance America Cash Advance Centers Inc. announced plans this week to close all 47 of its locations in Arizona, along with 75 locations in several other states.
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Advance America spokesman Jamie Fulmer said last month that the end of payday lending could force customers looking for cash to turn to unregulated Internet loans.
“The consumers who find themselves between paychecks with some type of unbudgeted or unexpected expense should be very concerned about the options left,” Fulmer said.
Arizona law takes effect
July 8, 2010 | Arizona, customers, employees, industry, regulation | Comments (0)From the story:
Payday loan customers in Pinal County already are feeling the impact of the expiration on Thursday of a law allowing the lending practice beginning Thursday.
Under the change, lenders no longer will be allowed to set interest rates as high as 460 percent annually. A 10-year-old law allowing them to go above the 36 percent rate cap for other lenders expires today.
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The Community Financial Services Association of America, an industry trade group, says that although payday loans are expensive, when people are in need of short-term cash they are often glad to have the option available to them.
Many of those who use payday loans have limited alternative sources of credit such as pawn shops, bank overdraft protection, credit card cash advances and informal lenders, according to CFSA,
Efforts to eliminate payday lenders from communities do not address the need some consumers have for short-term credit, and lack of access to the loans could place customers at greater risk for bounced checks, disconnected utilities or lack of funds for emergencies such as medical expenses or car repairs, the organization said.
Not rational
July 1, 2010 | Arizona, industry | Comments (2)This story is disturbing. The eagerness with which some people await the closing of payday lending stores in Ariziona is beyond rational. They don’t even seen to want lenders to try other services. This is ideology masking itself as policy. It’s emotion masking itself as seriousness.
Panic in Arizona
June 30, 2010 | Arizona, industry | Comments (0)Arizona deadline tomorrow
June 30, 2010 | Arizona, industry | Comments (0)The AP sums it up:
Payday lenders charging triple-digit interest rates will no longer be allowed to operate in Arizona after a 10-year-old law expires Thursday.
Lending companies failed to persuade voters or the Legislature to extend the provision allowing the high rates.
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Starting July 1, loans with annual interest rates exceeding 36 percent will be illegal in Arizona. Fifteen other states and the District of Columbia already use rate caps to limit payday loans, according to the Consumer Federation of America, a nonprofit consumer advocacy group in Washington, D.C.
The day after tomorrow
June 29, 2010 | Arizona, industry | Comments (0)No, not the cheesey post-nuclear war movie of the early ’80s, but the end of payday lending in Arizona. From the story:
Payday loans with interest rates topping 400 percent become illegal in Arizona at midnight Wednesday, after voters rejected a 2008 ballot measure to extend the industry’s 10-year authorization to operate.
State Senator Debbie McCune-Davis of Phoenix helped defeat last-ditch efforts to reverse the election results in the legislature.
“Voters were given the opportunity to make a decision about whether payday lenders continue to operate at outrageously high interest rates or change their practices to come under the 36 percent usury law. The voters were very clear about it, and now it’s happening.”
McCune-Davis calls ending payday loans “a victory for the people of Arizona.” Payday lenders say they can’t cover operating costs with a 36 percent rate cap, and several payday loan stores have already closed.
McCune-Davis missed the recent study by National Consumer Law Center saying that alternatives are NOT cheaper.
Lenders say they were providing a necessary service, but McCune-Davis says people have other options for small, short-term loans.
Arizona’s economy
June 28, 2010 | Arizona, industry | Comments (0)I hope the legislature doesn’t start complaining about job losses. From the story:
With the law that allows extremely high-interest loan expiring in just a few days, dozens of payday-loan stores throughout the Valley are closing their doors.
Update Arizona
June 28, 2010 | Arizona, industry | Comments (2)New law takes effect on Thursday. From the story:
Some payday lenders in Arizona have already shut their doors and more are expected to follow when a law authorizing their high-interest loans expires at the end of the month.
Starting Thursday, the state no longer will allow payday-loan operators to set interest rates as high as 460% annually. A 10-year-old law that allowed them to charge above the 36% annual rate cap imposed on other lenders will expire.
Lee Miller of the trade group Arizona Consumer Financial Services says smaller operators are expected to close, while large companies will try to find new products for Arizona customers.
