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US Government issues a new rule which can put out of business many payday lenders
#1
Just three months ago the The Consumer Financial Protection Bureau (CFPB) released a regulation  requiring lenders to determine if borrowers can repay their debts. This new rule will inevitably make lenders loan smaller amounts of money to people who seek their service. CFPB has estimated that the industry revenue will fall by 60%! That would be such a major hit for this business. 

However Republicans are against this new regulation and will try to nullify it in Congress. If they don't succeed, the new rule will become effective in 2019.

You can read more about it here: https://www.reuters.com/article/us-usa-c...SKBN1CA24K
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#2
Good, I think that unscrupulous payday lenders need to be reigned in. They tend to prey on those that aren't financial savvy. It is a vicious cycle and these lenders need more oversight.
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#3
(01-05-2018, 11:45 AM)chikatilo Wrote: Just three months ago the The Consumer Financial Protection Bureau (CFPB) released a regulation  requiring lenders to determine if borrowers can repay their debts. This new rule will inevitably make lenders loan smaller amounts of money to people who seek their service. CFPB has estimated that the industry revenue will fall by 60%! That would be such a major hit for this business. 

However Republicans are against this new regulation and will try to nullify it in Congress. If they don't succeed, the new rule will become effective in 2019.

You can read more about it here: https://www.reuters.com/article/us-usa-c...SKBN1CA24K

It is a welcome development on the surface in the sense that anyone that reads about it will feel that the government are really doing all they could to protect the people. However, there is need to monitor the process closely to avoid abuse of the new policy for that is the only way things will work out at the end. Also, there is need to provide other solutions such as corporative loans schemes and others that will give the people the opportunity to make a choice.
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#4
Interesting concept, but it does leave me a little concerned for the desperate people who are turning to these loans. It's gonna be a lot easier for them to get turned down or rejected when they apply, and they probably already have nowhere else to go.
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#5
(01-07-2018, 01:43 AM)Sase3119 Wrote: Interesting concept, but it does leave me a little concerned for the desperate people who are turning to these loans. It's gonna be a lot easier for them to get turned down or rejected when they apply, and they probably already have nowhere else to go.

It is going to be harsh on people that seeks loans from these people, if they could not get the loans. I think there is need to have feasible alternatives setup by government if they really want this to work out. Else, I don't think asking the payday loans scheme to turn down loan applications is going to work. 
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#6
(01-07-2018, 01:43 AM)Sase3119 Wrote: Interesting concept, but it does leave me a little concerned for the desperate people who are turning to these loans. It's gonna be a lot easier for them to get turned down or rejected when they apply, and they probably already have nowhere else to go.

Ultimately it's for their own good. This new regulation will prevent people from borrowing money they are unable to pay off. There are numerous articles on the news websites about folks who are sunk in debt, who eventually lose everything and commit a suicide because they can't pay 1000% interest after they've taken several loans to pay off previous ones. 

It will be very interesting to see if the republicans will prevent this regulation from becoming an official law. It's going to be a tough battle.
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#7
(01-07-2018, 05:54 PM)chikatilo Wrote:
(01-07-2018, 01:43 AM)Sase3119 Wrote: Interesting concept, but it does leave me a little concerned for the desperate people who are turning to these loans. It's gonna be a lot easier for them to get turned down or rejected when they apply, and they probably already have nowhere else to go.

Ultimately it's for their own good. This new regulation will prevent people from borrowing money they are unable to pay off. There are numerous articles on the news websites about folks who are sunk in debt, who eventually lose everything and commit a suicide because they can't pay 1000% interest after they've taken several loans to pay off previous ones. 

It will be very interesting to see if the republicans will prevent this regulation from becoming an official law. It's going to be a tough battle.

It's a shame that the Republicans are actually going against such policy. Does it mean they've got a new way out of the current situation where people are finding it difficult to pay off debts they owe and going through depressive situations. One thing that's I've always said is that money is not the path to getting rich, but the need to have ideas. 
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#8
(01-08-2018, 07:40 AM)Henrywrites Wrote:
(01-07-2018, 05:54 PM)chikatilo Wrote:
(01-07-2018, 01:43 AM)Sase3119 Wrote: Interesting concept, but it does leave me a little concerned for the desperate people who are turning to these loans. It's gonna be a lot easier for them to get turned down or rejected when they apply, and they probably already have nowhere else to go.

Ultimately it's for their own good. This new regulation will prevent people from borrowing money they are unable to pay off. There are numerous articles on the news websites about folks who are sunk in debt, who eventually lose everything and commit a suicide because they can't pay 1000% interest after they've taken several loans to pay off previous ones. 

It will be very interesting to see if the republicans will prevent this regulation from becoming an official law. It's going to be a tough battle.

It's a shame that the Republicans are actually going against such policy. Does it mean they've got a new way out of the current situation where people are finding it difficult to pay off debts they owe and going through depressive situations. One thing that's I've always said is that money is not the path to getting rich, but the need to have ideas. 


It doesn't seem like Donald Trump's Republican Party have an alternative solution. What seems is they care about the industry's business interests. The payday industry is worth 6 billion dollars. Republicans want everything to stay the same regarding this matter.
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#9
(01-07-2018, 01:43 AM)Sase3119 Wrote: Interesting concept, but it does leave me a little concerned for the desperate people who are turning to these loans. It's gonna be a lot easier for them to get turned down or rejected when they apply, and they probably already have nowhere else to go.

Getting those people into debt is not really a good alternative. It's for their own good. The government should do something so those people don't get into that kind of situation in the first place.
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#10
I don't see the sense in this room. The government should stay out of people's lives. People are grown up and the can make their own decisions. This legislation comes too late. Where was the government when credit led to the subprime crisis in 2007 -2008? They should have made the laws before then. They should legislate on interest rates instead. This makes more sense.Make the loans more affordable to repay first. There are people who desperately need the credit, especially in America where people can't afford basic health care.
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