The payday loan industry has always been big business. There are more payday loan lenders than McDonald's franchises in the US. In economic recessions payday lenders become a convenient option for cash-strapped borrowers who live paycheck to paycheck. The industry has been simultaneously lauded as an important resource that enables the poor to stay afloat on their bills and condemned as an unscrupulous exploitation of desperate people, similar to a loan shark.
When you look at case studies of borrowers who have received payday loans, the majority end up in a significantly worse financial situation than when they started. CBS did a segment on the industry last year, and reported one case wherein a woman ended up owing $1,500 in interest to float a base loan of $200.
With the advent of the Internet, the payday loan business has grown dramatically, virtually unchecked by regulators. Interest rates in this market have sky rocketed to unprecedented levels of 500% - 700%. The Senate is currently reviewing legislation to place caps on online payday lenders.
The video below is an excerpt of the CBS special that aired in July of 2008.
Friday, July 10, 2009
Monday, July 6, 2009
Consumers Beware: Mutual Consolidated Savings
Mutual Consolidated Savings, based in Tacoma Washington, is under investigation by the Federal Trade Commission and had its assets frozen this month.
The Company is being sued for aggressively soliciting debt-burdened consumers and charging up-front fees of $690 to $899 while providing little or no assistance in debt negotiation.
The Attorney General Robert McKenna made the following statement:
“Mutual Consolidated Savings has been the source of numerous consumer complaints,” McKenna said. “The Federal Trade Commission’s move to shut down its Tacoma call center means that fewer consumers will be misled by the company’s promises to bail them out of debt.”
The Better Business Bureau has has processed a total of 112 consumer complaints against the company during the past 36 months, which include fraudulent refund policies, contract dispute issues, billing or collection issues, sales practice issues, and difficulty in being removed from the company's call list, among others.
Have you done business with Mutual Consolidated Savings? If so, what was your experience?
Mutual Consolidated Savings
1215 Earnest S Brazill St Ste 33
Tacoma, WA 98405-4005
Ms Rachel Derricks, Service Manager
Phone: (800) 943-3250
Fax: (877) 669-9864
The Company is being sued for aggressively soliciting debt-burdened consumers and charging up-front fees of $690 to $899 while providing little or no assistance in debt negotiation.
The Attorney General Robert McKenna made the following statement:
“Mutual Consolidated Savings has been the source of numerous consumer complaints,” McKenna said. “The Federal Trade Commission’s move to shut down its Tacoma call center means that fewer consumers will be misled by the company’s promises to bail them out of debt.”
The Better Business Bureau has has processed a total of 112 consumer complaints against the company during the past 36 months, which include fraudulent refund policies, contract dispute issues, billing or collection issues, sales practice issues, and difficulty in being removed from the company's call list, among others.
Have you done business with Mutual Consolidated Savings? If so, what was your experience?
Mutual Consolidated Savings
1215 Earnest S Brazill St Ste 33
Tacoma, WA 98405-4005
Ms Rachel Derricks, Service Manager
Phone: (800) 943-3250
Fax: (877) 669-9864
Thursday, June 25, 2009
Fidelity Debt Solutions
Fidelity Debt Solutions, based in San Diego California, offers debt settlement services for credit cards, unsecured loans and lines of credit, auto debt and medical debt. The Company was founded in 2004 and also operates as the Aaron Mortgage Group.
Since its inception, the company has received 14 consumer complaints filed with the BBB. The complaints have involved the following:
5 complaints for Service Issues
4 complaints for Billing or Collection Issues
2 complaints for customer services issues
1 complaint for contract disputes
1 complaint for refund Or exchange issues
1 complaint for selling practices
Of these 14 complaints, 5 were resolved with the consumer. In addition to the complaints filed with the BBB, the company has recieved several complaints on ComplaintsBoard.com that involved service and billing issues. If you are considering working with this company, please do your research beforehand.
Since its inception, the company has received 14 consumer complaints filed with the BBB. The complaints have involved the following:
5 complaints for Service Issues
4 complaints for Billing or Collection Issues
2 complaints for customer services issues
1 complaint for contract disputes
1 complaint for refund Or exchange issues
1 complaint for selling practices
Of these 14 complaints, 5 were resolved with the consumer. In addition to the complaints filed with the BBB, the company has recieved several complaints on ComplaintsBoard.com that involved service and billing issues. If you are considering working with this company, please do your research beforehand.
Fidelity Debt Solutions
Aaron Mortgage Group Inc
591 Camino De La Reina #305
San Diego, CA 92108
TJ Belfanti, Vice President
Phone Number: (888) 241-2416
Fax Number: (866) 996-0995
591 Camino De La Reina #305
San Diego, CA 92108
TJ Belfanti, Vice President
Phone Number: (888) 241-2416
Fax Number: (866) 996-0995
Monday, June 8, 2009
Advanta Cancels Small Business Owners Lines of Credit
Advanta, a lender that specializes in providing credit to small businesses, announced today that it is retracting all of it lines of credit to small business owners.
The root of Advanta's problems stems from its need to re-pay the principal on bonds sooner than expected. In short, Advanta no longer has investor capital to lend to small businesses.
Ironically, Advanta was offered TARP money last year, but declined saying their balance sheet was in healthy shape.
This is the largest cancellation of lines of credit in recent history, and will affect more than 1 million small businesses.
Read the actual letter that Advanta sent to its employees on May 11th at the consumerist website.
The root of Advanta's problems stems from its need to re-pay the principal on bonds sooner than expected. In short, Advanta no longer has investor capital to lend to small businesses.
Ironically, Advanta was offered TARP money last year, but declined saying their balance sheet was in healthy shape.
This is the largest cancellation of lines of credit in recent history, and will affect more than 1 million small businesses.
Read the actual letter that Advanta sent to its employees on May 11th at the consumerist website.
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