Payday Loan Crackdown – Predatory Lending
There is a massive payday loan crackdown that has been happening in Ontario in the last few years as the governments wants to get to an idea state of having no payday loans at all. In Quebec, there are no payday loan lenders, and that is the ideal state that the Ontario government wants to get to in order to protect Ontario citizens from being ripped off by short term loans. A payday loan is a short term loan with a very high interest rate. These loans are given to the poor and the desperate. Paycheck loans are always predatory and no one should ever get a payday loan online or in person.
The loans until payday crackdown is an attempt to punish predatory lenders for the harm they inflict on people who need fast advances. The high interest rates in these loans turn out to be more than most of the people who take out the loans can afford. They are unable to pay the loan back and they are then constantly and chronically in debt. Some of the tactics that loan lenders use to get their money back is questionable and harmful. The government has started out by banning back to back these kinds of loans. That means a person must pay back their first loan in full before they will be allowed to take out another loan.
Capping interest rates is another step the government is thinking about taking as part of their paycheck advance loan crackdown. Making sure that interest rates don’t rise too high would protect vulnerable people who want to borrow from being taken advantage of. Cash in the form of a paycheck loan can be given up to $300 and there are hundreds of paycheck loan lenders in Ontario. The government in Ontario would like to model their approach after Quebec in order to stop the paycheck loan advance industry from growing any further.
Sometimes people are in need of a short term emergency advances and that is the hole that payday loan lenders fill. Unfortunately, they all too often victimize the people who take out the loans by making them indebted over their heads for amounts they are unable to pay back. The most important thing to remember about paycheck advances is that they should never be used unless you are absolutely sure you can pay back and you are absolutely sure the high interest rate is worth it. There are few situations in life that are this desperate.
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