Birmingham's payday lending moratorium set for vote, public hearing

BIRMINGHAM, Alabama -- The future growth of payday loan, title pawn and check-cashing businesses in Birmingham will be decided Tuesday when the Birmingham City Council votes on a proposed year-long moratorium.

The ordinance proposed by Councilwoman Lashunda Scales would ban any new title loan or payday loan businesses from opening for one year or until the city's comprehensive plan is complete.

Representatives of the payday lending industry say the proposed restrictions are unneeded.

But Scales, who is chairwoman of the council's Economic Development Committee, said Birmingham has been inundated with the businesses. "The law department has come up with an ordinance that will protect the citizens of Birmingham," she said of the proposal, which has been revised since she first presented it two months ago. "With the law department's official input, it answers all of the questions that council members had."

The businesses' negative impact is twofold, Scales said.

She said businesses offering short-term loans have high interest rates that keep financially strained customers trapped in a cycle of making interest-only payments.

Secondly, she said, the presence of too many of these businesses repel other commercial development.

"Our citizens deserve first-class businesses at an affordable price," she said. "However, if you have a string of these kind of predatory lending agencies in those same communities, then the likelihood of those (other) businesses locating in that area is nonexistent."

Scales said she has been contacted by representatives of AARP who support her ordinance.

"We're talking about senior citizens and the working poor," she said. "This is to be a voice for those who don't have a voice."

Industry response

However, industry officials said their industry provides a necessary service and is unfairly characterized.

"A moratorium on state-regulated storefronts is going to push consumers in need of short-term loans to unregulated Internet options with steeper fees," said Charles Hunter, spokesman for Borrow Smart Alabama, the industry's trade group. "This moratorium may be well-intentioned, but it is an unnecessary piece of legislation that will have unintended negative consequences including reduced city revenue and empty storefronts.

Be Smart About It: Paycheck Loans - payday loans online

Dealing with money can be dangerous. Chance is even greater when it is your money. The world of money advancements is no diverse. When handling these brief-term loans it really is crucial to be entirely conscious of what is going on.

Very first of all you want to know that the firm you happen to be borrowing from is genuine. If you go to a payday mortgage organization, it’s fairly straightforward to judge. The world of on-line lending is much various. As men and women struggle to uncover employment and shell out payments, on-line loan providers promising money can capitalize. If you want to get a cash mortgage, it can be essential that you believe in your lending organization. A great sign is if the loan provider posts or sends you its lending policies. Before you borrow cash, make certain you know how a lot you are expected to repay. There are a lot of lenders, so do not settle for a shady one.

A very good lending historical past is also an essential aspect. Attractive loan choices do not make up for a company that is not trustworthy. Even even though the payday loan method is straightforward, you want to have intelligent standards. Yet another great rule is this: if it looks too good to be correct, it almost certainly is. You can easily check out websites to see if a loan provider has a great status. There are a handful of distinct sources you can use to uncover helpful info about payday loans.

No doubt you do not want to be overdue on your payday loan repayment. The penalties can be extremely substantial, and it can further more harm your credit score. Really should you find yourself with late payments, you want to know your legal rights. A organization can not and should not call to harass you in any way. Remember not to inform personal or financial institution data around the phone. Will not hesitate to request for bank loan info to be mailed to you if you have doubts or inquiries. There are a number of government organizations exactly where you can report unlawful practices.

What Day Is It?

Day

One Day

Day Trading For Dummies

The Day Watch