July 11, 2008 • June Walbert
Q: My husband keeps taking out pay day loans even though I have done everything but leave him to make him understand they are BAD. The last one he took out, he gave them a check from my account. I read that Bush passed a new law so they can't connect anything to an account, especially mine. It doesn't even have his name on it. I feel like I am never going to get out of this hole he put us in. What can I do to get rid of these loans instead of getting rid of him?
- Tera
A: Bad is right! And you are right! For years I’ve been an outspoken critic of payday loans and you’re now living the vicious cycle nightmare – borrowing to pay off one loan and then borrowing to pay off that loan too. I am so sorry to hear that and I understand your frustration. As part of the 2007 Defense Authorization, a 36% rate cap was placed on payday loans to military servicemembers. The same legislation forbids the use of personal checks to access the borrower’s bank account. If you have concerns of non-compliant loans, I would recommend you contact your state’s attorney general.
I don’t know how you can fix your husband. Borrowing that money has become an easy fix for him and he needs to understand the long term ramifications of those decisions. By continuing to borrow at super high interest rates, he is possibly robbing your family of the opportunity to own a home, educate children, retire later down the road. He also needs to know that the military my revoke, suspend or deny a security clearance based on personal debt. Family and financial counseling may be in order. You may consider starting at the chaplain’s office. USAA does offer free financial advice as well. Best wishes to you both.
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The Law that Bush supposedly put into place is DOD 32 CFR 232 states in that the Local States Laws take precedence over the DOD policy....so if State law allows payday loan businesses to charge high interest, there's nothing DOD can do....the military has also issued rules and regulations that military members are not allowed to go to pay day loan places.... there are other companies that can help who are Licensed Financial Lenders who will allow military members borrow from them even if they have horrible credit score and these loans are unsecured....These licensed financial lenders are not pay day loans businesses.
Posted by: Phil | February 14, 2009 at 07:50 PM
There are many types of personal loans available in the market. Its very important to examine all your options first before settling with your final choice. Thanks for the info!
Posted by: personal loans | July 11, 2008 at 10:51 PM