Coming Soon To Your Suburb
This is a story that repeats itself across small towns and suburbs of America. Till two years ago, you’d not be able to find a single payday loan company in these places and suddenly, they’ve mushroomed all over the place. With increasing frequency, payday loan stores — offering short-term loans at high interest rates — are surfacing across the country. So, weren’t these guys supposed to be in low-income neighborhoods — areas where people were usually short of cash and would need help from the store? And what are these stores doing in moderate-income neighborhoods? Well, according to experts, the businesses have now saturated low-income neighborhoods. So, they are forced to expand into moderate-income communities where more families are piling up debt.
However, the payday loan industry does take umbrage to this description of theirs. Some payday lenders are quick to point out that you HAVE to qualify for that loan and that they don’t attract trashy people (just what they mean by trashy people is a mystery to me). Well, so is that why they are now proliferating into moderate-income neighborhoods?
A recent report by the Brookings institution shows that there is a huge number of payday loans and check-cashing services in these kind of suburbs. So, is this the beginning of a new trend? Experts believe it is as middle-income households are now looking for new ways to borrow money. That’s because their wages are falling behind inflation and many have maxed out their credit cards.
In reality, these guys don’t have a choice. They cannot use their credit cards, their income is not enough to stretch across the month and they need to pay for at least the necessities. So what do you do? Borrow from the payday-lending store next door, of course!
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