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| Group Urges Staying Clear of Payday Loans |
A public interest organization is warning you to steer clear of payday loans this holiday season.
Citizen Action Illinois warns the dangerous payday installment loans could end up costing your future.
"Payday loans create more problems than they solve," said Dory Rand, president of the Woodstock Institute. "One $200 loan could easily lead to thousands in interest and even send the borrower into the court system of bankruptcy."
Citizen Action Illinois is calling for passage of legislation sponsored by State Sen. Kimberly Lightford (D-Maywood) that would close a so-called loophole in the 2005 Payday Loan Reform.
"For the past five years in a row some players in the Illinois payday loan industry have used their clout to convince members of the state legislature to either stall or defeat attempts to close the payday loan reform loophole," said Lynda DeLaforgue, co-director Citizen Action Illinois. "The time has come to put an end to the 700 percent interest rate in Illinois."
The so-called loophole is that payday lending laws apply to loans up to 120 days, and lenders are offering products for terms of 121 days. The payday lenders point out that they are not getting around the law, but rather complying with it.
The group would like to see the legislation passed by the end of February.
Rather than going for a payday loan, the Monsignor Egan Campaign for Payday Loan Reform offers this advice:
* Look for lower cost sources of credit such as a credit union.
* Obtain a cash advance from your employer
(Illinois Radio Network) |
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| 12 18 09 by Newsroom |
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