The Memphis blues
January 28, 2009 | Tennessee, industry, local issues, regulation, states | Comments (0)The Memphis city council passed a zoning ordinance on title and payday lenders.
“Ridiculous”
January 17, 2009 | Tennessee, industry, media coverage, regulation, states | Comments (0)That’s a quote from Steven Schlein, spokesperson for the Community Financial Services Association of America, in response to the notion that payday lending causes bankruptcy. From the story in the The Tennessean:
Tennessee routinely ranks near the top nationally in terms of the number of bankruptcy filings per capita, but there is disagreement among other economists over whether payday loans lead to bankruptcy.
Brian Melzer, a senior lecturer at the Kellogg School of Management at Northwestern University, found that access to payday loans among people making between $15,000 and $50,000 in income increases the difficulty of paying bills by 25 percent compared with those who didn’t have payday lenders nearby.
However, Donald Morgan, a researcher with the Federal Reserve Bank of New York, and Michael Strain found that households in Georgia and North Carolina, which have effectively banned payday loans, bounced more checks and filed for Chapter 7 bankruptcy at a higher rate than households in states that did have access to the industry.
The industry argument is that payday lenders provide a cheaper short-term solution than the alternatives — high overdraft fees from banks that can average $27, or excessive late payments from credit card companies and utilities.
With overdraft, “people are paying $27 to borrow $36, versus a customer who comes in and borrows $100 from us, they pay $17.65,” said Check ‘N Go spokesman Jeff Kursman. “What’s a better bargain?”
Steven Schlein, a spokesman for industry group the Community Financial Services Association, said there is no correlation between payday lenders and bankruptcy. “To say one or the other caused bankruptcy is absolutely ridiculous,” he said.
It’s more likely that some people heading toward bankruptcy try to fend it off by taking out payday loans but only postpone the inevitable.
Maybe we’ll ask a fortune teller
December 27, 2008 | Tennessee, industry, media coverage, states | Comments (0)About the the fate of payday lenders in Memphis and Shelby County.
The Memphis blues again
December 9, 2008 | Tennessee, industry, media coverage, regulation, states | Comments (0)Now there’s a joint county-city effort to regulated payday lending. From today’s Commercial Appeal:
The Shelby County Commission on Monday changed a proposed law that limits where payday and title loan businesses can be built in the county, specifying that these establishments cannot be within a quarter mile of residential districts.
The proposed law — which commissioners then approved on the second of three readings and the Memphis City Council adopted on third and final reading last week — also specifies that these businesses cannot be within 1,000 feet of each other and require a special-use permit if business owners want to locate in zones other than industrial.
What’s next in Tennessee?
December 5, 2008 | Tennessee, industry, local issues | Comments (0)This story says the Shelby County Board of Commissioners will follow Memphis’s lead and implement a zoning ordinance. Would someone–the state, the federal goverment–give these people money to do what they do best, fix potholes?
Compromise in Memphis
December 3, 2008 | Tennessee, local issues, states | Comments (0)From today’ Commercial Appeal:
In a unanimous vote, the council approved on third and final reading a zoning ordinance that requires quick-loan businesses to be built 1,000 feet apart from each other and from churches, schools, day cares and neighborhoods.
But a few concessions were made at the last minute. To mitigate complaints from the payday and title loan industries and to win approval of skeptical council members, attorneys on both sides hammered out a compromise Tuesday that would allow for exceptions to the ordinance if business owners acquire a special-use permit.
Also, the law won’t go into effect for 90 days, allowing the industry time to prepare.
We love bluntness
December 2, 2008 | Tennessee, industry, local issues, states | Comments (0)Especially when stopping a local anti-payday lending ordinance.
Payday lenders “grouse”?
November 14, 2008 | Tennessee, regulation | Comments (0)Must be a Southern thing. From the story in the Memphis Daily News:
Lobbyists representing check-cashing businesses, payday lenders and auto title loan shops are meeting with Memphis and Shelby County lawmakers to voice their concerns over a proposed zoning ordinance designed to curb their growth.
The Payday Pundit sees no grousing, just normal lobbying activities.
It won’t work, but let’s do it
November 13, 2008 | Tennessee, media coverage, states | Comments (0)That’s the thrust of this editorial in the Memphis Commercial Appeal regarding a proposed city ordinance:
The truth be told, a proposed ordinance that would place new restrictions on payday loan and title loan businesses in Shelby County probably wouldn’t be very effective.
The Memphis City Council and Shelby County Commission should go ahead and pass it, anyway.
That’s the spirit. Do something ineffective but makes you feel good.
