Payday Loans

26 Jan Tax Refund Loans–A Bad Idea

Since tax season is on hand, the media is full of ads touting tax refund or "refund anticipation" loans. "Get your money NOW!" "In today's economic climate, can you afford to wait for your tax refund?" Well, the easy answer is, especially in today's economic climate you should not get a tax refund loan. Why not? It costs you, big time.
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01 Dec Outstanding Payday Loans and Bankruptcy

Post-dated payday loan checks can be cashed even after a bankruptcy is filed, according to a federal appellate panel. They may not be able to keep the money, however. Most bankruptcy filings trigger an automatic stay which stops collection of debt by creditors. One exception to this stay is for "negotiating" -- cashing -- a check. An Ohio bankruptcy court concluded this did not protect a payday lender that was collecting money on a high interest debt, after receiving notice of the case, and awarded damages and attorney fees. The court reasoned that although the check could be cashed, the money continued to be part of the bankruptcy estate and had to be returned. The Sixth Circuit Bankruptcy Appellate Panel reversed and concluded that the money lost its status as property of the estate when it was transferred. The debtor or trustee in the case could try to recover it as an unauthorized post-petition transfer but they were not entitled to immediate return of the money nor to damages. (The opinion is in In re Meadows.)
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28 Oct Payday Lenders Support Ballot Initiatives

Payday lenders and their lobbying arms are supporting ballot measures in Ohio and Arizona, two hotbeds of payday lenders, which would rollback recent laws passed in those states that regulate the payday lending industry.  The Wall Street Journal reports that payday lenders are spending millions to back ballot measures to challenge consumer-friendly restrictions on the industry.
Ohioans for Financial Freedom, the payday-lending industry's group in the state, has spent more than $16 million on the initiative there, compared with $265,000 by their opponents, according to campaign-finance filings with the Ohio secretary of state. The group has used the money on ads and mailers promoting payday lending and on a signature drive to put the initiative on the ballot. In Arizona, the wording of the ballot initiative suggests it would impose further regulation on payday lenders; in fact, it would roll back much tougher rules. Yes on 200 is promoting the initiative with a counterintuitive strategy: spending money on ads that depict payday lenders as unscrupulous. One ad says, "Arizonans agree: Payday lenders who rip off hard-working Americans need to be stopped," and asks voters to support the ballot initiative.
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28 Jul Is All Debt Collection Governed By The FDCPA?

In order for a debt to be governed by the Fair Debt Collection Practices Act, there are some requirements:
  • The debt must be a consumer debt: The debt must have been incurred for personal, household, or family reasons;
  • A debt collector must be involved: A debt collector (not the original creditor) collects for another;
  • The debtor must be a consumer: Any actual person
  • There must be a violation: A violation is anything that is untrue, unfair, disrespectful, or undignified done by the debt collector to the consumer.
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