Payday Loan Lenders

September 1, 2011 by staff 

Payday Loan LendersPayday Loan Lenders, Three years ago, the Federal Deposit Insurance Corporation hired the banks volunteered to experiment with the supply of short-term small loans to consumers. The aim was to increase the availability of low cost micro-credit as an alternative to payday and car title loans.

Only 28 banks, most of them small community institutions, have been recorded. It turns out that many banks were too busy inventing their own versions of borrowing three-digit claim with contempt.

Banks do not use the term emergency loans, but that’s exactly what they are selling the loans direct deposit. They offer loans to customers whose pay is automatically credited to their accounts. The main exorbitant fees are deducted with the next deposit.

Wells Fargo offers loans direct deposit in some states but not in Virginia or elsewhere in the former Wachovia. In the west, and its share of 7.50 per 100 provided on the side and is modest compared with other types of another bank. However, that figure is extrapolated to a rate of 261 percent.

The Center for Responsible Lending studied the direct deposit loans offered by multiple banks and found that the average borrower’s debt remains at about six months. Within this period, a 500 loan and usually accumulates and 900 in interest. One in four borrowers were beneficiaries of Social Security.

Direct deposit loans are only one method of the banks are using to replace lost benefits such as new federal regulations put pressure on other predatory practices.

A rule that took effect last year requires banks to obtain explicit permission from customers before the registration system that automatically approves overdraft transactions and evaluated the average rates of 34 and if an account has insufficient funds. Overdraft fees once generated and $ 24 million in annual revenue for banks. Now they are using aggressive and deceptive business practices to convince consumers to choose plans costly overdraft protection.

Banks are businesses, and should be allowed to obtain benefits, but they should not by taking advantage of customers who are experiencing a financial crisis. All consumers should take time to learn about the products your bank and other fees and question the policies that seem unfair. While there may be the target of treason today, you can be sure that apathy will encourage more dirty tricks in the future.

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