February 11, 2010 10:12 PM UTC

Where Do Payday Lenders Locate? Where They Can Easily Prey on People

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• by: TheBell

( – promoted by Middle of the Road)

Aracely Panameno, the director of Latino outreach for the Center for Responsible Lending, was in town recently to meet with Latino community leaders. She presented them with the results of a recent CRL study that shows payday lenders nationally are nearly eight times as concentrated in neighborhoods with the largest shares of Latinos and African-Americans.

The experience in Colorado is much the same. Researchers at Colorado College found that payday lenders are more likely to locate in Front Range communities with higher percentages of racial/ethnic minorities, young adults, senior citizens, military personnel and immigrants.

In Denver, three council districts with heavy Latino populations are home to 83 percent of all the payday lenders in the city.

• District 1, represented by Councilman Rick Garcia, is 49 percent Latino and has 12 payday lenders, or 18 percent of Denver’s total.

• District 3, represented by Councilman Paul Lopez, is 77 percent Latino and has 17 payday lenders, or 25 percent of the city’s total.

• District 9, represented by Councilwoman Judy Montero, is 62 percent Latino and takes the cake with 27 payday lenders, or 40 percent of the total in Denver.

But Denver is not the only area where this pattern exists. Colorado Springs is home to 66 payday lending locations — all of them clustered in 12 of the city’s 56 ZIP codes. One of the lowest income neighborhoods has 19 payday lenders, or almost one-third of the city’s total, and eight payday lenders can be found in one of Colorado Springs’ highest minority neighborhoods.

Payday lenders are concentrated in six of Aurora’s 21 ZIP codes, most of them with large minority populations.

That might explain why more than seven out of 10 Latinos in Colorado support proposals to better regulate payday loans and cap them at the state’s 36 percent usury limit.

What is interesting is that most Coloradans feel the same way. More than six out of 10 Republicans, Democrats and independents support making payday lenders abide by the state’s 36 percent usury limit.

Coloradans get it! They understand that charging more than 300 percent for a loan is just not right.