Better Regulations of Predatory Lenders Needed

When Joseph’s car broke down a week before his paycheque he needed fast money to pay the $1000 repair bill. Without savings, available credit or a network of family and friends who could help him financially, he decided to go to a payday advance loan agency (think Money Mart, Cash Money, etc.).Like using a credit card, Joseph figured there would be little to no interest if he paid back the loan on time. When he went to pay back the $1000 loan two weeks later, he was charged $300 (30%) in interest.Based on his experience Joseph expressed concern for others, “It’s a vicious cycle. A person could easily end up needing a payday loan to pay back a payday loan. I would never go back.”Enter Rohan.  Living with a disability and in his fifties, Rohan felt reborn when he fell in love and was happily planning a wedding.  Without available funds to pay for even a small celebration, a friend suggested he get a payday advance loan.Rohan ended up borrowing from three different lenders to pay the minimum payment for his growing debt.  After borrowing from friends and scraping by for two years, Rohan was able to pay back what he owed.Such experiences are common for many residents in our community where the number of payday advance lenders roughly equal the number of Tim Horton’s.  In desperation, individuals and families often turn to them for help, only to make their financial situation far worse.Association of Community Organizations for Reform Now (ACORN) has taken a lead role in the fight against ‘predatory lenders’.

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For the full article please visit: http://www.downsviewadvocate.ca/2016/06/better-regulations-predatory-lenders-needed-tom-rakocevic/