Kevin Borland of the Kentucky branch of the Community Financial Services Association of The United States wants readers to know the failure of House Bill 182 is a victory for consumer freedom of choice. He writes in a Lexington Herald-Leader op-ed that this battle for freedom of choice sits at the heart of almost all arguments for the short term installment loans industry. Resource for this article – Right for consumers to choose preserved in Kentucky by MoneyBlogNewz.
House Bill 182 stopped for a while
Several opponents say they will get together in 2012 to revote with the same bill although Kentucky House Bill 182 was shot down in a 13-10 vote. This shows how Kentucky activists are left in the Dark. Borland says that they don’t understand pay day loans. There is very strict payday lending laws in the state. Payday lenders can’t charge interest at all. The definition of the loan is a single-payment, fee-based product in Kentucky.
It is just “a try to trick legislators and the public” into thinking it is bad to have short term installment loan pricing by using Annual Percentage Rate this way, Borland suggests. In reality, a flat fee of $15 to $25 per $100 loaned on a typical two-week payday advance is a 15 to 25 percent fee, depending upon the lender.
What CLOUT believes
The Citizens of Louisville Organized and United Together (CLOUT) and the Kentucky Coalition for Responsible Lending (KCRL) supported House Bill 182, as did the AARP. The personal installment loan market has banks and credit unions in them, funded by CLOUT and KCRL that compete. Having competition is one thing while CLOUT and KCRL get money from payday lending rivals while attacking them. This involvement shouldn’t be there is a disclaimer at the very least. Borland states this is very significant.
With Chase Financial, AARP competes itself. The money advances AARP members get have a high rate of interest, claims Borland. That’s what it is though.
Financial choices made by consumers
While pay day loans may not be ideal for every financial scenario, they can be the least costly option available, particularly among credit constrained customers. CLOUT, KCRL and AARP should do something else besides short term installment loans if they’re hurtful to anybody, Borland state. The belief that those organizations don’t do so may suggest the attacks are all bark and no bite.
Information from
CLOUT Funding
cloutky.org/page3/page3.html
KCRL Coalition
kyresponsiblelending.wordpress.com/coalition-membership/
Lexington Herald-Leader
kentucky.com/2011/04/11/1704022/consumers-won-with-defeat-of-payday.html
The CFSA encourages responsible lending and borrowing
youtu.be/OZQr_nh7GZA
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