Our veterans are not immune to the pitfalls of payday lenders. While laws like the Military Lending Act provide some protections against unscrupulous lenders, veterans are left with little guidance to navigate the wide variety of payday lenders who are all too happy to give loans to veterans in need.
Joe is one such veteran. He’s a Marine Corps combat veteran who fought in the Iraq War and who was honorably discharged in 2008. He now lives in Washington state.
Not too long ago, Joe found himself in need of cash to buy groceries and other basic necessities. It was only supposed to be a two-week loan, and he only borrowed $200. The Marine veteran has yet to pay back that initial loan and has been forced to renew it four or five times, though he’s unsure of the exact number.
“I’ve probably paid between $1,500 and $2,500 in fees,” said Joe.
He’s not paying just one company, either. Often, borrowers will take out loans from one lender to pay back another. In Joe’s case, he’s had to borrow from three lenders: Moneytree, Alpine Loan Spokane, and ACE Cash Express. Like so many people who have felt the brunt of shady lending and collection practices, Joe has experienced tremendous stress in paying back his loans.
In addition to his loan fees, he’s had to pay overdraft fees to his bank. He’s been hounded both at home and work with calls about twice a day. He often had to choose between paying back his loan or spending his hard-earned dollars on basic living expenses.
“It felt horrible. It felt like I was suffocating,” said Joe.
Despite all this and knowing the dangers of payday lending, if he was in another tight financial situation, Joe says he would still consider taking another loan out. Though it would have to be a life-or-death situation. Unfortunately, many borrowers in similar situations simply do not have other options.
We’re fighting back against these lenders who have wreaked havoc on the financial security of so many in our community. You can join the fight, too. Help us tell the CFPB to adopt a rule that would end payday lending debt traps.