Archive for the 'Mississippi' Category

Friday, September 8, 2006

Mississippi Group Wants to Restrict Payday Loans

By J.J. Cameron
Payday Loan Writer

Will payday loan firms expand in Mississippi? We asked that question in the spring. If it’s up to a series of state legislatures, the answer will be an emphatic “NO!”

Payday Cash

In January, the Mississippi Center for Justice will ask lawmakers to require storefront, supposedly low cost payday loan lenders to provide information about the amounts of money they lend, along with demographic information about their customers.

The nonprofit group also will push legislation that would allow Mississippi communities to regulate the number of cash advance companies in their cities.

Purpose of payday loan legislation: Representatives of the center said the proposed legislation would provide a better picture of who the lenders are targeting and whether those customers are able to pay high-interest rates that accompany the payday loans no faxing.

“You shouldn’t allow predatory practices targeting people who don’t have any money to begin with,” center staff attorney David Miller told the Hattiesburg American editorial board Wednesday.

Based on the fees of $17 per $100 loaned over a two-week period, Miller said yearly interest would be between 400 and 500 percent.

“This is supposed to be an emergency loan, not one that you take out every two weeks and get caught in the debt cycle,” he said. “With a reporting system, we could tell if that was happening.”

Moreover, the location of the storefronts shows that there’s a target market that includes people unable to get loans from traditional banks. Providers of quick cash loans try to take advantage.

“These businesses are targeting lower-income communities, African-American communities, military bases, people near casinos - these businesses are predatory,” he said.

However, Dan Robinson, president of the Mississippi Financial Service Centers Association, said that Miller’s figures were misleading and that there is already legislation in place that monitors payday loans.

“What we charge is a fee for cashing checks, plain and simple … and whether they honor that check in a week, two weeks, six weeks, eight weeks, the flat fee is what we charge for,” he said.

He added that for most, the fees charged by check-cashing businesses are smaller than similar fees from a bank. Overall, bad credit payday loans get a bad rap.

“The bank charge is around $30 for a bounced check, and a merchant can charge up to $40, so one insufficient check can cost someone $70,” he said.

Saturday, March 11, 2006

Will Payday Loan Firms Expand in Mississippi?

By J.J. Cameron
Payday Loan Writer

While many other states - through editorials or legislative measures - are trying to ban the use of payday loans, a pending bill in Misssissippi would expand the reach of these cash advances.

Under the propsal, cash loan companies would be able to offer automobile club memberships on top of the loans. During debate over the proposal Thursday, some House members argued it would allow companies that already charge high interest rates to extract more money from Mississippians who can least afford it.

"Make no mistake about it: although it's considered an auto club membership, all it really is, is hidden interest," said Rep. David Norquist, D-Cleveland. "On a $700 loan, a $70 membership is 10 percent of the value of the loan. If it is never used, someone has just paid an additional 10 percent interest."

However, supporters of the bill rejected those arguments, saying people living paycheck to paycheck might need tire changes or other roadside services of an auto club if their vehicles break down.

"They don't drive BMWs, Mercedes, Bentleys. They drive older cars, cars that may break down, have problems," said Rep. Danny Guice, R-Ocean Springs, chairman of the House Banking and Financial Services Committee.

The bill had passed the Senate on Feb. 1. The House passed its own version after a vote of 76-39 on Thursday. Because the House made changes, though, the bill now moves back to the Senate for more work. This is at least the second year lawmakers have considered this proposal.

Bailey said authorizing the sale of auto club memberships will allow insurance companies "to come in and steal legally from our people."

Stay tuned to find out the future of payday advances in this state.

Instant Payday Loans!
  • No Faxing!
  • No Credit Checks!
  • Up To $1000!
  • Instant Approval!
  • Overnight Cash!