This isn’t a financial idea…this is theft
August 25, 2008 | customers, personal finance | Comments (5)Payday lenders are often accused of taking in “huge” profits and “gouging” their customers with “exorbinant” fees. With customers willing to steal and welch on agreements they have made, payday lenders often have to write bad loans off as a loss or pay for legal fees to get their money back. Payday lenders charge a set fee for their services and those fees are set by their costs, if more people are willing to cheat and steal, payday lender’s costs will rise and so will fees.
UPDATE:
It should also be mentioned that members of the Community Financial Services Association abide by the best practices which include an extended payment plan for people who can’t payback right away.
From the CFSA website:
What happens if I don’t have the necessary funds to repay the advance on my due date?
Each company has its own collection procedures, but every CFSA member company is committed to collecting past due accounts in a professional, fair and lawful manner as required by our Industry Best Practices.However, if your check is deposited and your bank returns it due to insufficient funds, you may be charged a returned check fee by your payday advance provider, if permitted by applicable law. You should also be aware that most financial institutions charge a NSF (Non Sufficient Funds) fee for a returned check and, in some circumstances, may revoke your checking account privileges.
Remember: You are responsible for full repayment of your account (including a returned check charge, when appropriate). Your payday advance company will contact you to collect the amount due and, if necessary, may turn your account over to a collection agency.
If my account becomes past due, will I face criminal prosecution?
No. In accordance with CFSA’s Industry Best Practices, member companies do not threaten or pursue criminal action against customers if a check is returned unpaid. If it becomes necessary and is appropriate, however, companies may seek civil remedies to collect past due accounts.
Can I renew, or roll over, my advance by just paying the fee again on my due date?
Some state laws allow rollovers, although most do not. Even in states that permit rollovers, CFSA member companies are limited to four rollovers or the state limit, whichever is less. Check with your local CFSA member company to determine your options.Remember: Limiting rollovers is a consumer protection designed to ensure responsible, short-term use of the service. It is important that you fully evaluate the cost versus the benefit of rolling over a payday advance.
Comments»
It is a little ironic that a blog complaining about “scum bag” lenders with no street address to mail a payment to and having numerous DBA’s to continue ACHing the account is written by a person with no contact information or supporting credentials anywhere to be found on the site!!
Actually, if you clicked on the “About us” section of the site, you’d see who sponsored the Payday Pundit as well as contact information.
Sorry, I was referring to the blog that advised the person to to close thier account, not the Pundit. No issues with your position.
Apparently “call and work it out” isn’t a solution that occurs to these people. It’s more fun to turn the situation into a confrontation than work out a repayment plan.
Glenn,
That is SOOOOO the truth. I have customers that will avoid the phone call for ever , then I go to their house and they are like”can we work out some kind of repayment plan?” happens all the time.