DALLAS — Three years ago, Dallas passed an ordinance making it harder for payday lenders to operate. Today, only half of the 240 storefronts still exist.
"I heard it over and over again from payday and auto title [lenders]. 'Who else will lend to these poor people? That's why we have to charge 400-500 percent.' Well, guess what? We just came up with an alternative," said City Council member Jerry Allen, a former personal banker.
The alternative is a non-profit called Community Loan Center of Dallas, which will soon start lending up to $1,000 for a one-year term at 18 percent interest through its website, CLCofDallas.org.
Councilman Allen officially announces the program Wednesday at City Hall.
"You have to have a job to get the loan, and these are hard-working people," he explained. "If we can keep more of that money in their pockets and they're helping their families and their kids, how can that not be a win-win for everybody?"
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3 comments:
Ya good luck with that, you will soon find out why those payday lenders were charging 400-500 percent. These people are deadbeats thats why they are same ones who got home loans thru our Liberal wackos and did not pay that either
GOOD LUCK !! The risk is so high with those loans They will be Bankrupt within 18 Months !!
On a $1000 Loan at 18% The interest in 18 Months is $148.50. That is a 6.7% Return on investment. Most High Risk loans of this type are lucky to perform at an 80% total payout and a big percentage of the total payout is way past the due date. So using the Watermelon Theory (buying watermelons @ 50 cents each and selling them @ 3 for $1.00) They will need a bigger truck.
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