Our venerated senior citizens shouldn’t have to rely on payday lenders to get by, but it happens all too often, and lenders walk away with their limited, hard-earned dollars. Such is the case of S. McWilliams.
The Boise, Idaho, resident relies on a fixed income that, unfortunately, hasn’t always been enough to meet her needs. In this instance, McWilliams needed some quick cash to pay her bills and to stock up on groceries. The EZ Money store in the city was ready to hand over the funds she needed, but McWilliams wasn’t ready for what happened to her once she accepted them.
The initial loan of $350 was supposed to be paid back in one month’s time. But payday lenders operate on the notion that borrowers won’t be able to pay back their loan within the allotted time. They prey upon the vulnerable, using a borrower’s tight financial situation to trap them in a vicious debt cycle that lines lender pockets. In McWilliams’ case, EZ Money has renewed her loan more than 24 times! So far, the Idaho senior has paid more than $3,000 in fees.
This business model is clearly not working for consumers.
“As a senior with a fixed income, it is hard to get by each month and now that I have this loan payment, I find myself trapped because I have to get behind on other bills to stay current on my loan,” McWilliams explained. “Then I have to re-borrow to get current on my other bills.”
Because of her desperate situation, McWilliams has had to turn to food banks, local charities, family, and friends to help her through these trying times. She’s also still trying to pay back that $350 loan and admits that she might have to renew it again.
McWilliams’ story is a common one, similar to the others that we’ve featured in this series, but there is a government agency that has stepped up put a stop to this abuse. Currently, the Consumer Financial Protection Bureau (CFPB) is weighing a rule that would regulate payday lending operations, and put in place critical protections for consumers. NCLR supports this rule and is working hard to see it adopted.
You can lend your voice to the chorus of supporters who want to see payday lenders curbed in their communities. Visit our site and add your name to the petition to let CFPB Director Rob Cordray know that you support a strong rule that protects consumers and curbs underhanded lending practices.
If you’re a senior on a fixed income, visit the CFPB website for resources to help you protect yourself.