Even if you think you are really out of money and your need for it is dire, you still need to keep your brains working so that you may keep payday loans as your last resort. The Consumer Financial Protection Bureau is trying its best to completely eradicate this issuing of payday advances through which many people are tricked into lifelong debt traps on a daily basis. The director of this bureau made people aware of their actions through which they intend to put a stop to this practice which completely ensnares the common sense of people and strangles them in a debt of about 390% of the loan that they used.
These people will make sure that the lenders completely give up their way of renewing the loans which is their method of putting the borrowers under long-term burdens of fees and additional charges and the borrowers also will undergo some honest kind of a test through which they will ensure that they will be able to pay back the loan on the date fixed by them and their lenders. The borrowers that will not fulfill these requirements would be given some alternatives like short-term loans or less risky long term loans.
Other methods through which lenders of these payday loans have always managed to financially harass the borrowers if they have failed to return the loans is by penetrating deep into the borrower’s bank accounts and retrieving the money the borrowers have failed to give until then. This over drafting causes a further burden of fees on the borrower’s shoulders through the bank or also might end up in the closing of the bank account completely. This strategy is called as a hard and successful blow which will finally cut off consumer’s access to credit by The Community Financial Services Association of America.
Bruce McClary, responding to these words that those people who go for payday loans do not have a choice, said that nine out of ten times when you need money and plan to borrow it, you will definitely end up in a bad deal. Therefore, a better proposition is to completely avoid borrowing money but if you still need to borrow money direly then go for the companies that give interest-free loans. One needs to be aware of the rules of this business and it is very important to know what laws and policies govern the in-person and online borrowing.