Monthly Archive for: "September, 2012"
Payday loans are currently illegal (or HIGHLY regulated) in 14 states (Arizona, Arkansas, Connecticut, Georgia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Vermont and West Virginia), but that hasn’t stopped payday loan lenders from making loans in those states!
How exactly are they LEGALLY doing it? Some have partnered with banks with out of state headquarters, while others have partnered with Native American Tribes that have been, in essence, granted a free pass thanks to the Indian Reservation System.
CNBC recently reported on this loophole and showed us how Native American Indian tribes are not held to the same legal standard. In fact, as long as you get your payday loan online from a payday loan lender that is partnered with or is run by a North American Tribe, it’s apparently not illegal at all.
To me, this is proof of how the payday loan industry will be run in a few years. As more and more states outlaw payday loans, the only place you’ll be able to turn to for a fast, cash advance is the Indian Tribes. As far as I’m concerned, this is karma coming full circle. When our forefathers arrived in the New World, they decimated the Indian population and took their land from them, pushing the few remaining Indians to the least hospitable pieces of land known to them at the time. For years, Native American Indian tribes have struggled to find a way to survive and prosper the way they once had.
Indian casinos have definitely helped, but its not easy getting everyone to drive a couple of hours to your remotely located casino where they will gamble enough to pay for all the casino employees’ salaries AND bring in enough money to help the rest of the reservation rise out of poverty.
Online payday loans are definitely the wave of the future for Native American Indian tribes that want to help their people break the cycle of poverty. They can lend to anyone in the United States at incredibly high rates (although often lower rates than other payday loan lenders offer) and are not restricted by any states boundaries. My prediction is that in a couple of years, most of the payday loans made in the United States will be made by Native American Indian tribes or their partners.
The truth of the matter is that Payday Loans are a necessary evil. According to a 2009 CNN article, 17 million people didn’t have bank accounts in the United States in 2009. That number has risen to 30 million people in 2012 according to a recent Business Insider article! That’s over a 76% increase in 3 years. That shows you just how hard economic times have become.
Most people turn to their bank when they need a quick, short-term loan, but if you don’t have a bank account, you can’t qualify for a loan from the bank. It’s a Catch 22. You need money to open a bank account in order to get a loan, but if you had money in the bank, you wouldn’t even need a payday loan in the first place.
So, if you ever find yourself in a situation where you NEED a payday loan, be sure to read as many online payday loan reviews as possible before proceeding with the lender you trust the most. Remember to always check out their lender rating and understand the terms of the loan before fully committing.
It looks like Payday Loans are finally becoming legal again in North Carolina according to a recent story from news station WRAL. Payday Loans made a brief appearance in North Carolina from 1997 to 2001 before they were allowed to expire by lawmakers due to public pressure. But even then the smart payday loan lenders simply teamed up with local banks to legitimize their operations.
Now several banks have come out with their own version of a payday loan to tap into the incredibly lucrative payday loan business. One such bank is Alabama based Regions Bank. In fact, Regions Bank has been offering their own version of the pay day loan (known as Ready Advance) for a year and a half here in North Carolina at the low rate of 365% APR.
The only catch with Regions Bank payday loan is that you have to have been a bank account holder of Regions Bank for at least 9 months in order to qualify for their payday loan So, looks like online payday lenders still have a viable market for those that don’t have a Regions Bank account. But now other local banks, like Suntrust Bank, are taking notice and considering bringing out their own version of the pay day loan. Everyone wants a piece of the pie and consumers apparently always need short-term loans in times of emergency.
So, which is better, getting a payday loan from your local bank or from an online lender? Well, unless you have a bank account with Regions Bank, then your only other choice is going with an online payday loan lender. Be sure to read the reviews on the payday lender you go with first though, so you know what you’re in for.