time for change- payday loans


Arizona and Ohio voters resoundingly defeat payday lenders. tide is turning accross the nation as the american public becomes aware of the diabolical greed and the huge cost of these loans that is destroying families caught in the pay day lending trap.


payday loans prey on the most vulnerable during economic difficulties and it is time for Montana to pass legislation regulating these businesses. from seniors to newlyweds, anyone with a checking account and a job or social security benefits can walk into these places and get up to 300.00 instantly. all they have to do is postdate a check for their next payday and make it out for 375.00. easy money right? it is, but anything that easy has to carry a big stinger. what happens if your upcoming paycheck in two weeks is too small to cover the check you wrote? you have two choices. let the check bounce, in which case the lender can and will prosecute you for writing a bad check and you will go to jail or at the very least pay a lot of fines and attorney fees or, you can pay the 75.00 interest each month and have them “rollover” the loan again and again.  the typical payday loan consumer does this rollover 10 months or more. thus paying $1500.00 for the original loan of $300.00. that same $300.00 loan if not paid within the year would cost you $1950.00- this is an interest rate of 650%!!!

what is the difference between payday loans and vehicle title loans or pawn shops? the difference is with a pawn shop or vehicle title loan you risk losing an asset like a rifle or diamond ring or a vehicle if you do not pay. this is fairly well understood and while pawning items and losing title to a vehicle can be painful, at least the loan is resolved and does not go on into perpetuity like a payday loan which traps the consumer every two weeks into insane interest rates. that is the insidious nature of this business, it traps the consumer in an endless cycle of debt that many people can never escape.

there are groups accross montana interested in introducing legislation in the next montana state legislative session which convenes on Jan 5, 2009 (less than two months away) there is already a group in billings working on it and they have already begun to garner support from both parties on this important issue of curbing payday lenders and regulating this business so that the terms are  more fair for the consumer.

43 states accross america have already passed legislation to regulate this industry. Oregon, Ohio, and Colorado have managed to do this with both republican and democratic support. Montana should pass similar legislation and with strong leadership from both parties this session it can be done. these groups need our support and they need people willing to testify about their personal ordeals with payday lenders or about ordeals that friends and family members may have had. since this is early in the process i would like to invite anyone who has any dealings with payday loan lenders to share with us your story on this blog. you don’t have to give us your name and we will not ever divulge identities to anyone. but, we need your stories about payday lending and would invite you to share them with us.

hopefully, we can limit the interest to 36% per year as most states have and make the payments one month out instead of two weeks out to give people more time to pay. together, we can accomplish much to achieve change in America. payday businesses should not be allowed to prey on our fellow financially vulnerable Montanans without some regulation and consumer protections to guide them. please join in this small but important change. with the worsening economic climate many more Montanans will fall prey to payday lenders if we do not act this winter. call your local legislators and let them know how you feel about this issue. together we can make a difference one change at a time.


  1. You’re right, Mr. bear, that the rollover of one payday loan into another is causing much pain to many people. There’s no incentive for the payday lender to help you learn how to manage your finances better.

    Next time they might want to wander across the street to the local credit union or bank. I know of at least one that will help you with a real loan and some counseling on how to manage the debt. There are other options out there, if only folks knew about them or had the time to figure it all out.

  2. I’m glad Ohio voters saw through the lies and deceptive advertisements of the payday lending industry and voted overwhelmingly to pass issue 5! This is a very positive development for Ohio’s families, particularly those who were caught in the never ending cycle of payday lending debt. Ohioans realized that payday lending is a defective and predatory product designed to trap people in debt. Voters strongly repudiated over a decade of predatory payday lending! This is a great victory for Ohio’s consumers!

  3. While that is sound advice for some states, Binky, it is not too easily done in Montana. There are currently several Credit Unions that are offering a different type of payday loan, one that is only an 18% annual interest rate. However those banks and credit unions are few and far between, and as far as I know none reside in the state of Montana. And you speak as if it’s so easy to walk into the bank and obtain a loan, usually these people are going to these predatory lenders because they lack the necessary positive credit scores that are required to obtain a proper loan…hence it is their only option shy of selling their goods. They are with the bulk of America in that they live paycheck to paycheck and have to resort to these measures to pay simple bills such as Electricity, or to buy groceries for themselves and their kids. Yes, there is definitely proper budget education available at these sources, they don’t want you to learn how to manage your money and stretch resources, then they would be out of a very profitable business. There are very few organizations that will offer these types of educational classes, and unfortunately they are not widely known. It’s hard to find the resources on these types of services available prior to resorting to the payday loan measures.
    It’s only at grassroots levels that we can change the laws that enable these businesses to thrive. They can still make a hefty profit while lowering their interest rates, but they will not do so unless forced to do so by state legislature. Unfortunately there is a lack of education to the common consumer the kind of detriment they are doing to society, without a proper working economy we run into the types of strife that we are now in under the Bush administration. And with the continued bailouts provided by designer suit wearing Senate and Congressmen for their friends on Wall Street but no relief to the average Joe who is facing losing their house or falling short on bills and resorting to those predatory lending providers, the cycle will only keep repeating. I only hope that with our much needed change in administration that will soon take power on January 20th, that we will see that much needed change in attitude from the higher-ups that we elected to represent our best interests. But then again, they can only support our needs and wants if we let them know what it is that we want…. Thus it takes the voices of you, the wandering blog peruser and webophile to get out there and garner support for this much needed legislation. Montana is not the only state affected, and unfortunately the largest hit population that is suffering from these sharks are that of our troops. You see, while the Bush administration was busy pumping billions of dollars each month into this reckless war, he failed to provide the troops with proper raises to account for the inflation that has occured naturally. So they are trying desperately to support their families on pitiful salaries from the federal government, all while they are left in charge of billions of dollars worth of equipment. Where is the justice you ask? I ask the same, and I will join the Bear in asking for you all to put down your complacency and rise up, even if you didn’t vote for Obama and don’t support him, just look at what he was able to accomplish with grassroots efforts. He did it all with the help of individuals, not large corporate sponsors. You can accomplish anything when there is unity. I suggest we all try it.

  4. A stop should be put to the greed of payday loan lenders. They prey on people who come from the lower paid section of the population. Lower interest rates will turn these loans into a welcome help for those who need emergency money

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