Welcome to the latest series at the wildly popular JosephSangl.com: “5 Things That Will Help Fix The Economy” In this series, I will be sharing some principles I believe will help fix the economy long term.
The economy has been stuck for some time. The words “Great Recession,” “Fiscal Cliff,” “Sequestration,” “Stagnant,” and “Jobless Recovery” have become common everyday language.
Number 5: Make rip-off loans illegal
I know this seems a little out of place when compared to the other four items, but I really feel this needs to be included. When economies allow organizations to charge OUTRAGEOUS fees and interest to citizens, it is positioned to eliminate the middle class.
In a coaching appointment, I had a person who had signed up for a “payday” loan. The loan agreement clearly outlines that the “annual percentage rate” was 782.14%. That is not a typo! The interest being charged to this person was 782.14%.
I’ve heard arguments from those who make these types of loans:
- We help people who are “in a pinch” You can actually say that with a straight face?
- People voluntarily sign up for these loans. This doesn’t make it right!
- These are smaller loans, so it’s not that big of a deal. Yes, it is!
Have you noticed where these rip-off loan businesses are located? Near rich neighborhoods? Nope. They are located next to communities where people have little money education. It’s my goal to help educate everyone to the point that no one would ever borrow money with such horrific financial terms and these types of organizations have to go out of business!
This type of lending is awful, and it should be illegal. Who’s with me?
Read the entire series (available after 3/14/2013)