Payday Loan Writer
Credit counselor Yolanda Dixon is familiar with payday loans. She spends a majority of her time trying to help soldiers at Fort Leonard Wood who have taken out short-term, military payday advances.
"Over the years, we've seen it growing worse," said Dixon, who works at the Consumer Credit Counseling Service in Springfield, Mo.
As we've previously reported, military payday loans cause financial problems, distract soldiers from their mission and compromise military readiness, while costing some soldiers their security clearance for reasons of financial irresponsibility.
Such quick cash lending by instant payday loan stores, often found outside military bases, is drawing increasing national attention - and appears headed for a showdown in Washington. Citing "predatory" lending practices, Sen. Jim Talent, R-Mo., has guided a bill through the Senate that would cap the annual percentage rate of loans to military personnel at 36 percent.
The payday advances industry vehemently opposes the legislation, saying it would deny military personnel an option for paying short-term bills or covering bank checks. A typical case may involve a soldier, needing cash to fix a washing machine or pay a bill, who goes to a payday store and agrees to pay $230 when he gets his next paycheck of $200, in exchange for an advance on it.
Later, unable to make the payment on this miltary payday loan, he rolls it over for another couple of weeks, as interest accumulates.
For the past decade, Dale Buckingham has warned airmen about the payday loan spiral. A retired chief master sergeant at Whiteman Air Force Base, he teaches business at two nearby colleges.
"Young folks who come into the Air Force, sometimes they get a little tight, and they go out looking at these payday loan companies - and they end up in trouble. It's a slippery slope," Buckingham said.