Proposition 200 is coming up for a vote on November 4, and Arizona media is doing their best to cast unwarranted aspersions on an industry – short term installment loans – that wants to maintain its livelihood and continue to compete with other financial institutions in the spirit of the free market.
Installment loans offer consumers the freedom of choice when it comes to those emergency situations where the budget won’t stretch quite far enough to cover an unexpected expense. However, if we are to buy into Melissa Blasius’s of NBC 12 News report, we would assume that just because the bad credit installment loans industry has spent a large amount of money to support YES on 200 efforts means that they are self-serving and are not interested in real reform.
Blasius breaks out the common and oh-so-misinformed “400
PERCENT APR!” yawner, which has no bearing on payday loans, short term loans or anything related. Payday loans are TWO-WEEK loans, not annual loans. The percentage rate a consumer pays is 15 percent if their lender charges $15 per $100 loaned. The fixation on APR (annual percentage rate) that the media, banks and credit unions have is based originally upon the 1968 Truth in Lending Act, but now it’s merely a false rallying point.
Short term installment loans operate differently. As the name implies, they work on an installment basis, making repayment much easier. Plus, the consumer is the one who chooses their debit date.
Banks and credit unions want short term lenders put out of business because they pose too much competition for their big moneymaker: check overdraft protection fees. If you want to talk scary interest rates, take a gander at this report from the Center for American Progress. Americans are paying in excess of $17.5 billion per year. Ouch!
If you want to know the REAL deal about why you should vote YES on 200 in Arizona, check out this site. Then you’ll see why short term installment loans are useful, inexpensive compared to the options banks and credit unions would like you to have and essential if we are to maintain the consumer’s freedom of choice when it comes to how they will manage their finances.
If the citizens of Arizona were so concerned with tighter regulation of the industry, why wouldn’t they vote for 200? Seriously. 200 makes payday loans better for both consumer and lender. If everyone wins, what’s the problem?
Proposition 200 is just another example of why you should research the issues before you vote. Each side is going to try to persuade you based on the advantages of voting with their side. But really, you should look into the issue to get the details. That way you can be truly informed and make the right decision.
Payday loans have become a reliable resource that many people rely on during unexpected events. Banks and credit unions generally require you have a good credit report and even still, they provide annual loans. But when you’re unable to stretch your paycheck and need a little extra cash to hold you over, payday loans are without a doubt the best option to take. There are also short-term loans available if you are unable to repay the loan in full on your due date and allows you to make installment payments which fits well into your budget.