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March 30, 2010 12:04 AM UTC

"How Did I Get Myself In This Payday Loan Mess?"

  • 9 Comments
  • by: TheBell

(And stop spamming us! – promoted by Colorado Pols)

The following letter came to us because we are part of a coalition that is trying to make payday lending less harmful for Coloradans. After an initial email, the writer decided to share her story in greater detail. We think it paints a revealing picture of payday lending in Colorado.

Ever since I wrote to you I have been thinking, how did I get myself in this payday loan mess?

I just got a bonus from work, of $1,500.00 I am vowing to cut myself off payday loans.

I am thinking how can I be so stupid, and borrow all this money? But I am not stupid, payday loans dangle this money in your face, they are not like my Credit Union that looks at my debt ratio, ask why I need the money, looks at my credit to see if I am in debt and in financial trouble.

Payday loans are out to make a buck. A high buck for that matter.

I am ashamed that I did this, this payday I paid, $288 To Money Tree, $198 to Speedy Cash, $575 to EzMoney, $575 to Express cash. I still owe Emergency Cash $240 which I will pay off next payday.

And National Payday Loans is taking me to court because they wouldn’t give me a payment plan and I stopped payment on there check to force them to offer me a payment plan. I felt I had paid them at least $1,000 back and I wasn’t being unreasonable in my request. I have a court date of April 14, 2010, in which I will go to court and ask for a payment plan. Except now, I don’t owe $575 I owe $1,100. My first thought when I got the summons was to get two payday loans and pay them off, because I don’t want this on my credit record. But, I have to face this as having one choice, and erase payday loan from my choices.

I don’t have any dependents, and I work and make a middle class living. I was able to crunch numbers and come up with the money to pay all these payday loans off. I left my car payment behind to do this, and now I have to work with them to allow me time to catch up. This is the real world.

But when payday loan companies make it so easy to borrow, and so hard to payback, because of the high interest they charge, people don’t realize it until it is to late. It would be so easy for me to get in my car today and go to any of these payday loans and they would give me the money for my car payment, but like a drug or alcohol addiction, I am kicking the habit.

I feel sorry for the people who have payday loan habits and don’t have the resources to do what I am doing. Money is like a drug. If you don’t have it you crave it, and if somebody makes it easy to get it, without checking if you can afford it or not, that company is  like drug dealer.

So I pray for my court date, the Attorney General’s office said they would try to help. I pray for a payment plan, and I pray that we succeed in getting payday loans out of town.

Please tell me who to write to besides you. Ez Money gave me a list of representatives, shall I send them all a email or letter, will that help?

I know we’re pressed for time. EZ Money said they will not survive if House Bill 1351  passes. She thought I was asking for a list of representatives because I was on her side. I didn’t say anything to her about this, but I have spoken up before about how unreasonable they are. Some of those employees just tell me, they just work there.

I wanted to write this email, to put my thoughts in writing while there fresh in my mind. I paid off these payday loans yesterday.

God Bless You for being a voice for the people.

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9 thoughts on ““How Did I Get Myself In This Payday Loan Mess?””

  2. Got some literature from them recently, asking me to support their efforts to kill the payday loan bill. They didn’t even say who they were; they were too ashamed.

  4. 1. Keep your checking account sized at only that amount you need each month to meet obligations.

    2. Scrape everything else into an account that yields something, but is easily accessible. When you get to 6x no. 1, see no. 3

    3. Scrape everything else into a brokerage account and buy bonds or equities.

    4. Use your employers saving modes, 401k, etc…

    5. Plan for major purchases and use a budget. nos. 2 & 3 are there to protect you from your fuck-ups.

    I know, being responsible can be so “not fun” and it makes it hard to go to Hawaii or Miami on a whim.

  5. I just don’t get this.  How is this different than irresponsible gambling at the Casinos?  I’m not trying to be a smart-ass here.  I just don’t understand how making terrible personal decisions is ok in the story above, but when people gamble their lives away making the same astonishingly catastrophic decisions, the business is not at fault.

    Why isn’t the Bell screaming to shut down the Casinos?  They prey on irresponsible idiots too!

    Seriously, please explain the difference, because I am mystified.

    1. What’s to stop someone from opening up a credit card and maxing it out or buying alcohol instead of food for their kids? I’m a staunch Democrat but there needs to be some personal accountability. If the person above had an emergency where would she have turned to if not Payday stores? She likely didn’t turn to the credit union because they wouldn’t have loaned her money. This is a very sad situation and I’m glad to hear things are improving for her however the solution isn’t always that easy.  

      1. It’s pretty apparent that most of the population thinks these payday stores are predatory. I think folks know what they’re getting into these days…

        1. Look it up: usury.

          Then look up: Colorado special exemption for payday loans.

          I just joined a credit union – $5 minimum balance for a share.  They’ve got a payday loan solution that fits within the usury laws.

          And really – how is it that a company can’t make a profit on 36-39% APR?

          Here’s an example from Oregon from 2006, courtesy of USA Today:

          Blaine has a PowerPoint presentation showing that at a 12% interest rate and 4% default rate, the SECU makes a healthy 2% on its cash advances. In reality, he says, the default rate is far less. “We don’t put that in there because people don’t believe it.”

          With 40,000 people using the program monthly, the SECU became the largest payday lender in the state.

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