For the Protection Of Debtors

Most states have usury laws designed to protect people from modern day “moneychangers.” These laws prohibit lending money at an interest rate in excess of a certain statutory maximum. This is a “usury limit.” rates vary quite a bit from state to state, but they average about sixteen percent maximum. Why then, do some “predatory lenders” get away with charging twenty five percent, thirty five percent, even forty five percent in states that have much lower limits? We should thank the Federal government, with its special interest driven law making system. Well usury law has been abolished in some states. This is for the protection of the people for paying an interest that is against the law or against the conscience. Since payday loan has great demand on most people, government has to protect all of them. Or else they will pay interest that is not regulated by law or the lenders will just impose huge interest anytime they want. And those who rely help of money lenders will find hard time on adjusting and coping up with their financial problem. Fortunately, there are some people who suffer bankruptcy due to huge payment of interest on payday loans and because they find it hard to pay the interest and the penalty in case of late payments.

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