Banks and Banking

Banks Overcharge with Overdrafts, How Can Payday Loans Help?

5412081717_754ac187cd_zYou know that overdraft fees are a big hassle. Of course! Everyone knows that. When you have no money, the bank lets you spend money you don’t have, and then charges you an extra fee on top of it: going over your checking by even one penny can cost you upwards of $50. It is, as we have documented here before, the biggest ongoing scam in America.

But here is what you might not know – the Big Banks are counting on your overdraft. They encourage it, they support it, they even re-structure their charges to maximize the number of fees you have to pay.

In other words, an overdraft fee isn’t just an inconvenience, it is a weapon used by the banks to rob you of every single dollar they can. (more…)

Banks Encouraged to Start Offering Payday Loans

payday_loansAll over the country payday loans are being revamped and revitalized. North Carolina, Pennsylvania, Missouri, and a growing list of states have officials tackling the issues of short-term and predatory lending.

The economy is weak, and people need more financial help. Banks are not meeting this need, forcing people to turn to short term, high interest loans. Instead of pushing more laws to restrict these lenders, some people want to make loans more readily available from banks.

Raj Date is one of those people. As a former deputy director of the Consumer Financial Protection Bureau (CFPB), he has a lot of hands-on experience with these loan issues, and recently spoke up about them. (more…)

Payday Loans and Banking

The banking industry often refers to payday loan companies as unworthy. Banks will argue that payday loan companies are designed for low-income people and individuals without established credit.

The truth of the matter is that payday loan companies assist individuals with all different types of income and credit throughout the world. Banks lick their chops on long-term loans and somewhat despise the short-term solution available from payday loan companies. In reality, payday loan companies are taking business away from the traditional bank loans. Banks look at the bottom line and they do not concern themselves with the short-term needs of many borrowers. Many people feel that banks will encourage the borrower to get a bigger loan than necessary. (more…)

More Regulations? Payday Lenders Say Enough!

4626254830_2d3d69eaccFinancial reforms were originally debated to regulate banks and financial lenders once it became clear that the applications for securing a mortgage for subprime lenders had been mismanaged. In addition, once money got tight for banks, they turned to pick the pockets of the consumers by adding ATM fees, increasing interest rates on credit cards, and reducing equity lines of credit. In the past, financial institutions made most their money on attracting people to save with them. These days bank fees and interest have produced a windfall for the very people who had to be bailed out due to poor financial management of the banks. The government has decided it’s time now to protect the consumer by producing legislation to make financial lenders behave better, but payday lenders and cash checkers are already heavily regulated. They believe they should be excluded from current legislation otherwise the new laws may be enough to put them out of business.