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Payday lending and check cashing outfits typically charge customers about $17 for every $100 they lend, with payment due in two weeks. That’s equivalent to a credit card company charging more than 400 percent annualized interest. The companies argue that they serve cash-poor people who suffer temporary inconveniences, like car problems or minor home repairs, at a fee that’s at least lower than a bounced check charge.
This year payday lenders have sought to open up shop in Oakland, East Allegheny, East Liberty and Lawrenceville — to the consternation of neighborhood advocates. Payday lenders “are nothing more than legalized loan sharks,” says Aggie Brose, chair of the Anti-Predatory-Lending Initiative of the Pittsburgh Community Reinvestment Group. “It just sucks all of the wealth out of our neighborhoods.”
Community groups have used zoning challenges to slow payday lenders down. But Pittsburgh’s current zoning law makes no mention of payday lenders, leaving the Zoning Board of Adjustment to wrestle with whether they are financial institutions, retail establishments or something else.
So community groups drafted a proposal that would limit payday lenders to Pittsburgh’s industrial zones and highways. “The service is still available,” notes Mark Fatla, executive director of the Community Technical Assistance Center, which aids neighborhood groups. “People can go to McKnight Road or Green Tree if they want to get ripped off,” he adds.
City Councilor Bill Peduto introduced the proposal at council’s July 13 meeting. Why pursue this now, when Pittsburgh’s financial survival occupies most of City Hall‘s energy? “These locations are bad for business, they’re bad for people and they’re bad for neighborhoods,” Peduto says.
Expect payday lenders to fight the effort. “They don’t like our industry, so they’re trying to zone us out,” says Steve Schlein, spokesman for the Community Financial Services Association, which represents payday lenders. “It’s ridiculous, and it’s an abuse of their powers.”
Peduto’s proposal now faces a series of public hearings, but takes force on a temporary basis pending a final vote likely in the fall — if the city isn’t too busy looking for its own payday loan by then.
This article appears in Jul 29 – Aug 4, 2004.
Payday loans offer budget-conscious people access to cash at times when it is most needed. For people living from paycheck to paycheck, this type of loan is important. A payday loan is a short-term loan that essentially funds emergency situations, such as car repairs, unexpected bills, or something else. The loans are intended to help people, but then some people doesn’t realize the importance of it, some of them would resort to criminal acts rather than turning to this kind of financial resourse. Although some may not want to go this route, thinking that they might create something they will regret down the road, it’s nothing compared to being caught doing something as outrageous as stealing. One of the world’s largest jewel heists took place on Thursday, December 4th, as four thieves entered Harry Winston boutique in Paris and took off with diamond rings, gem-studded bracelets and other jewelry worth $180 million. The thieves, who were dressed in women’s clothing and wigs, busted in close to closing time and rummaged through the store in record time. Paris’ Harry Winston boutique was also robbed last year where three thieves, who were never caught, took off with $28.4 million worth of jewels. The December 4th robbery is currently under investigation. French authorities say it isn’t likely the thieves will be able to sell the gems taken through traditional outlets because of the high profile of the heist. This further proves that during any severe economic commotion, there’s an increase of crimes like robberies because people become desperate to obtain even the smallest amount of extra cash. If you’re in desperate need of extra money, don’t do something horrific. Instead, be heroic when it comes to your finances and make a better move; get a payday loan. You won’t end up in jail for this one. Click to read more on http://personalmoneystore.com/moneyblog/2008/12/10/you-can-get-payday-loans-to-buy-christmas-gifts-with-rather-than-robbery/.