Ball State

» payday loan

By China at 9:39 PM

The government is trying to pass a bill that will effectively eliminate the payday loan industry, leaving many people without an alternative means of borrowing money. I used to feel that payday advances were just a legalized form of loan sharking (the illegal practice of loaning money at outrageous interest rates for short periods of time), then I realized what an important service this really is.

What if you are a person struggling to make ends meet and an unexpected expense comes up, like your car breaks down? You need to get your car repaired so that you can go to work and earn some more money. You don't have time to take a loan out at a bank, and for many that is not an option anyway due to credit problems. Sure, you could call your family members, but you don't want to have to burden them, so you get a quick cash advance, and you go on.

Many Americans are living day to day and paycheck to paycheck. In this type of situation, one unexpected event could send their lives spiraling out of control, and maybe even put a family out on the street.

It is great in theory that our government wants to protect us from the high interest rates of these loans, but where will these people get money from in their times of need. Will the closing of these places possibly land some families on the street? I just am not sure why the government finds a need to close these places. Obviously, there is a need for them based on how many people are using their services. And is it really such a bad thing, I mean so what they are making money off loaning money, isn't that called free enterprise. These companies found a need and filled it and now people are using it, so really if the people using these services don't care about the interest rate, then why does the government?

I personally think that the government should leave these businesses alone and allow them to make money and help people, especially in these hard economic times. I mean with the cost of everything going up, and more and more people getting laid off, I am sure that there will be a definite need for these payday advance places. Why not allow people to borrow money for the short term at a higher interest rate?