Pay day loan Businesses

Hi,
In terms of Online Payday Loans they might not be legal at your borrower,that means they might not have any registered offices at your state,but they might have offices at other states!!!!
And in terms of Storefront Payday Loans,they are licensed at your borrower itself..So,they are licensed to do business at your state.

Shane, you really shouldn't generalize, please gear your answer toward the posters comments or question. Please do not keep posting the same thing over and over again, your posts are redundant and generalizations. Let's focus on the poster's specific problem. Thank you.

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And the other way we can get them closed down is to educate more consumers as to why it's a bad idea to patronize these places in the first place. If there's noone coming in to take out one of their high-priced loans, they're not making any money and won't be around much longer. Trust me, the doors will be shut in that case!

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i agree wild kat but may be we can spread the word about the law and how they should function i do agree we cant get rid of them in todays society where money is surely everything we need to spread awareness and help people ou of the mess

Yes. Too bad though that people do not realize it ir pay attention to the warnings until they are already in too deep.

And what they need to know at that point is what options they do have. And we know they have them! But again, the only way to close these places down is to convince people why it's a bad idea to use them. Once there are no people coming through the doors, then the PDL owners will close their businesses.

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I agree, PDLOwner.

Now, I'm not defending the PDL industry, even the legal ones. I happen to think that even the storefront PDLs are predatory. If you listen to the advertisements and statements from representatives of the industry, pdls are supposed to be short-term loans for emergencies... say, you have a sudden medical expense that happens just before a payday, so you get a pdl, and pay it off when you get paid next week. Right? Riiiiight. Because we all know that it doesn't work that way.

The vast majority of people who use pdls are exactly the ones who can't afford to pay the whole thing back on the next paycheck, and end up in an endless cycle of paying renewal or refinance fees over and over until they are in complete financial ruin. These "customers" are the bread and butter of the PDL industry (just like overdraft fees for banks and late/finance fees for CC companies). This is further evidenced by the fact that you will not find PDL storefronts in areas populated by the people who WOULD be able to pay it back right away and not get caught in the cycle; no, they are concentrated in poor areas.

So, licensed and "legitimate" or not, there is no denying that they are little better than legal loan sharks.

BUT, the demand is there. Desperate people are going to borrow money that they shouldn't. So if they're gonna swim with sharks, better swim with the ones that have had their shots and are on a little bit of a leash, than the wild ones that are completely unrestrained, right? The PDL industry is NOT going to go away until the unlicensed ones are put out of business first.

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You make some valid points, and I heartily agree with the necessity of more consistent regulations from state to state.

Your assertion that PDL storefronts not being concentrated in poorer areas is not universally true. Here in Houston, where there is virtually no zoning (meaning residential and retail areas are heavily intermingled), you can identify which areas have a poorer, more uneducated population by the concentration of PDL storefronts. I'm not saying there are none in the more affluent areas or the big retail clusters. But where in those areas you might see one every few blocks, in the poorer areas (frequently along bus lines, where you also get a high population of struggling people) you will see at least 1 per block, sometimes 2 or 3. Instead of being concentrated around wal-marts or strip centers, they are concentrated around low-income apartment complexes. This isn't 15 years ago, this is NOW.

But you are right. The pdl industry (both legal and otherwise) isn't going anywhere. The middle class is sinking, and the number of people who are desperate and making poor decisions isn't decreasing; it's exploding. There's a market for "easy" loans, and I agree that that market is best served by a regulated industry.

Great post!

I have 2 questions for you.

1. Do the stores you mentioned in lower income areas have a lifespan that started at the beginning of the industry or have they been opened in the last 5-10 years? I would guess that they have been in that location since the industry expanded into the area.

2. Are the same stores PDL stores or check cashiers that offer PDL's? Again, big difference as most multi-line locations have a core business of one or the other depending on the area they are located. Low income is check cashing and middle to upper middle is PDL.

1. You know, I've only really noticed pdl storefronts in the last 5 years or so, so I can't accurately answer that... Tho my friends and I were discussing a couple of months ago that it seems that there are a whole lot more around than there used to be; but this concentration around low-income housing also reflects that growth.

2. I'd have to make a point of paying attention to the distinction to answer that accurately, too... but I'd say it's a mixture of both. I've noticed alot of places whose signage had an emphasis on check cashing now advertise almost exclusively payday advances and loans.

I HAVE noticed that the big, corperate stores like Ace tend to be everywhere, and the smaller chains tend to be almost exclusively in poor areas.

You make a very good point. Until you have them brought to your attention for whatever reason, you tend to overlook them. In the last 3-5 years, there has been alot of press about PDL's and most of it has come from the illegal lenders online and thier aggressive collection practices.

The advertising in the check cashing stores has trended to the PDL side over the last 3-7 years due to the increase of the direct deposit. They had to adapt to new revenue streams as the papercheck began to disappear. This does not change the fact that thier core business is still check cashing, money transfers and bill payment, but added the PDL's to off-set the loss in fees from check cashing.

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SO many PDL's in the US have their addresses located on tribal Indian lands; does anyone have statistics on how many storefront PDL's are located in those areas? It would be interesting to see if the PDL's are "biting the hands that feed them." As for PDL's not being clustered in less-affluent areas; sorry, I have to disagree with that. While it's true you might see them in a high traffic area next to a WalMart or Target, how often do you see them next to upscale shopping areas? I've never seen it.

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I didn't say poor, I said less affluent; you might not see a storefront PDL in a very low-income part of town, but neither will you see one next to a Neiman-Marcus, Tiffany Jewelry, etc. And I'd still be interested to know if there ARE PDLs located on the tribal lands where some of the PDLs have addresses. (wouldn't it be fascinating to see what happened if someone on tribal land took out a PDL, discovered it was illegal, and defaulted? As THEY would be on tribal land, would the PDL be able to go after them for $$$? Or would the PDL still be considered illegal? Just wondering)

Note that i said you wont find many PD stores near the affluent shopping areas. The credit card companies have those shopping outlets on lock down already.

You will find them near most new walmart complexes. And there is a large public payday lender that has a contract with walmart giving them first right of refusal to open a store in any new walmart complexes. In most places I have been, walmart is never considered an affluent shopping place.

I have no idea about tribal lands. The laws in those places often go against all common sense. It would depend on if tribal law trumps state laws. In some cases it does but in others it does not.

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Once a debt is sold, it is no longer the responsibility of the original creditor. I am sure most collection companies violate the fdcpa quite often. But to think that the original lender gets there money either way is living in an idealistic world.

Once an account goes 30 days past due, the collection rate is under 25%. If it goes

The problem is that the uncollectable accounts get sold multiple times and end up with the bottom feeders in the collection industry. S insider stated, once sold, the debt is out of the original creditors control.

[QUOTE=paulmergel;699650]i agree there owner.however,alot of even legit places sell the debt to places that couldn't give a fig about the FDCPA.if every pdl went by the book though there would be no need for this great site.most do not sad to say.:(:([/QUOTE]

Unfortunatley for all of us on both sides, the issue has to due with the illegal lenders. This forum is needed to aid individuals that get trapped of IPDL's and the posts here demonstrate that 95%+ of the problems do not deal with the legal licensed lenders. Are you going to have people that start threads about legal lenders? Yes, but how many times do the threads mention that they chose to take out 5+ loans or are just looking for a way out of paying the money back with advice that would work with illegal lenders?

The fact is that the numbers are very low with regards to complaints filed against legal lenders with state regulators. I would surmise that they are probably some of the lowest in the lending industry if you wanted to do some checking. The problem is that the opponents of the industry do not want to investigate this for fear of of justifying our very existence.