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payday loans
short term loans
place where people
loan companies
vicious cycle
Native American Payday Loans Are Booming
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Native American Payday Loans Are Booming

It seems that regardless of what individual states do to curb these money pits, Native American payday loans are booming.

Seems they have changed their names to short term loans to get around usury laws, and claim they are not covered by the laws of the states.

Not covered by state laws?

In recent months federal regulators have been putting the squeeze on lenders to stop working with online loan companies, as they are skirting the laws of some states banning payday loans.

Of course the industry is fighting back in court, claiming that many of their websites are run by Native American Tribes which have sovereign status and are not subject to the state of federal laws.

Can they get away with this?

The Lac Vieux Desert Band of Lake Superior Chippewa Indians in Michigan who own the website that runs Castle Payday has joined one other tribe to stop legal action in New York, claiming the state has no jurisdiction over them.

Payday loans in new York are illegal, and New York superintendent of financial services Benjamin Lawsky has sent out cease and desist orders to at least 34 companies doing business illegally in new York. Castle Payday is on that list.

Yet it is business as usual for these companies.

Why are people so against these loans?

Payday loans originally were a good idea. A place where people who could not get under a thousand dollars in emergency situations and pay it back quickly without worry of not being able to raise the money.

The industry quickly figured out they could take advantage of these peoples situations and exploit them by charging huge interest rates and trapping these people in a payday loan trap.

What is the payday loan trap?

This is a situation where you end up borrowing more and more money from these companies just to keep your payments current. It is a vicious cycle that seems to never end, and can cost you literally thousands and thousands of dollars in interest.

It is so simple to get the money and so hard to pay it back.

Can people fight back?

People sure can! If you have payday loan debt right now you can step out of the trap and get your finances back in order by contacting a payday loan consolidation company.

These people will get your interest stopped and set you up on a payment plan you can afford.

Summary

No matter what they come up with for names these loans are all just a way to make the companies rich at your expense. They will not rebuild your credit or get you out of any emergencies without creating a whole batch of new ones!

Do yourself a favor and stay clear of them.

Please feel free to share this article and leave any questions or comments below!


Street Talk

Emma Lee  

Good info to know...

Reply
  about 5 years ago

It sure is Emma, thanks for reading!

Reply
  about 5 years ago

If they want to believe they can operate outside the law, then they shouldn't expect legal system to help them when people can't pay these loans back.

Reply
  about 6 years ago

They usually do not, they just threaten legal action but rarely put it into action. When they have a direct link to your checking account, they just bide their time till you have funds available then they take them.

Reply
  about 6 years ago

Look who's getting scalped now. :-) I had no idea ANY state had the backbone to abolish payday loans. How did New York manage to pass a law that actually helps the average Joe? Obviously they're having trouble enforcing the law, but...

Reply
  about 6 years ago

Surprisingly enough New York is leading the way.

Reply
  about 6 years ago

Great advice Shawn. We should run as far away as we can from these monsters. Great article. Cheers!

Reply
  about 6 years ago

Thanks for reading!

Reply
  about 6 years ago
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