Monday, October 25, 2004

The Manhole Thieves

Manhole covers are being stolen in Newham. Who are the potential culprits, according to the police?

- Irate feminists insisting that the manholes be renamed personholes.
- Cave-dwelling troglydytes attempting to gather more food.
- Subterranea Britannica on a recruiting drive.
- Jewellers on a hunt for larger, more distinctive "bling"-style meddallions.
- The provisional wing of the Ultimate Frisbee movement.
- Thames Water. Lifting manhole covers consumes valuable time and eats into dividends. This bold initiative would save enough to buy each board member a new golf club.
- The Criminal Underworld. These thefts would make the Underworld much easier to commute from.

95 Comments:

Anonymous Anonymous said...

I think they're hiding the real story: Thames Water are saving money by making their manhole covers out of crushed Digestive biscuits and grey camoflage paint. They're dissolving in the rain, dammit. Without a single thought of the children.

8:13 pm  
Blogger Hypatia said...

Manhole is such a rude word. I'm with the feminists on this one: non-gender-specific holes is far more genteel.

10:18 am  
Anonymous Anonymous said...

No, no no. This is all connected with the iron and steel shortage in China. Vast amounts of stolen man-hole covers are being illicitly exported to Shanghai by the London branch of the Triads.

The relevant authorities are now replacing them with recycled plastic covers.

2:53 pm  
Blogger jon said...

After we paid for our kids summer camp california we found it tough to recover! I totally agree with you!

11:26 pm  
Anonymous Anonymous said...

Hey i noticed your site is about united kingdom time i found somewhere if your in the UK that allows you to send spoofed sms!

send a TXT "EN SPOOFING 07712345678 Hi i really fancy you" to 69911, Hi i
really fancy you is sent to 07712345678 and the user gets a standard reply.

Changing 07712345678 with the number you want to send too!

The SMS Costs £1.50 per msg but its really good!

I hope you enjoy this :) i did so pass on the word!

Remember its UK Only

7:32 pm  
Anonymous Anonymous said...

Hey i noticed your site is about call united kingdom i found somewhere if your in the UK that allows you to send spoofed sms!

send a TXT "EN SPOOFING 07712345678 Hi i really fancy you" to 69911, Hi i
really fancy you is sent to 07712345678 and the user gets a standard reply.

Changing 07712345678 with the number you want to send too!

The SMS Costs £1.50 per msg but its really good!

I hope you enjoy this :) i did so pass on the word!

Remember its UK Only

7:33 pm  
Anonymous Anonymous said...

"Help me if you can I'm feeling down" - I also think I must be lost.

I was searching for Elvis and somehow ended up in your blog, but you know I'm sure I saw him on the golf course yesterday. Now this is strange because usually I see him in the supermarket.

Honest really, last time I saw him there he was right in front of me, next to the steaks singing "Love me Tender".

He said to me (his lip was only slightly curled) "Boy, you need to get yourself a shiny, new lcd tv to go with that blue suede sofa of yours.

But Elvis said I, In the Ghetto nobody has a lcd tv .

Dude I'm All Shook Up said Elvis. I think I'll have me another cheeseburger.

Then I'm gonna go home, put ma dancin' suit on, munch me some uppers and freak out to that maaaaaaaaad surfing scene in Apocalypse Now on ma lcd tv .

How cool is that boy?

And then he just walked out of the supermarket singing. . .

"You give me love and consolation,
You give me strength to carry on "

Strange day or what? :-)

6:00 am  
Blogger George said...

Quick And Easy Holiday Planning. System There's a lot to think about when planning a holiday and no matter how hard you try, you almost always forget something. The solution...
System

4:41 am  
Anonymous Anonymous said...

Very cool blog you got! I just added you to my bookmarks!

I have a great article resource you might want to check out.

11:29 am  
Anonymous Anonymous said...

Hi... Looks like this paid to drive thing is really taking off on the net...How about paid to drive in UK. I came accross this website that speciallizes in only paid to drive programs in the UK.. Go to paid to driveand check it out. Spread the word and get paid 300 pounds a week or more for driving your own car or get given a car---WOW!!!. Thats the best.

11:56 pm  
Blogger George said...

Well, here's a refreshing new idea for you, specially and it won't cost you an arm and a leg. specially

1:31 am  
Anonymous Anonymous said...

Great blog you have! I really enjoyed it. I heard of a great site that is giving away a free set of Nike Golf Clubs. I think your readers will enjoy it. Just click the link below and enter your Zip Code to see if you qualify!
Free Nike Golf Clubs!

6:15 am  
Anonymous Anonymous said...

Great blog you have! I really enjoyed it. I heard of a great site that is giving away a free set of Nike Golf Clubs. I think your readers will enjoy it. Just click the link below and enter your Zip Code to see if you qualify!
Free Nike Golf Clubs!

7:47 am  
Anonymous Anonymous said...

I would also check out volkswagen jetta part

2:43 pm  
Anonymous Anonymous said...

I'd have to say that I agree with you 100%. You might like this golf tip golf site that I came across. Thanks again for your insight.

5:02 am  
Anonymous Anonymous said...

I'd have to say that I agree with you 100%. You might like this golf picture golf site that I came across. Thanks again for your insight.

10:14 am  
Blogger Google Page Rank 6 said...

Want more clicks to your Adsense Ads on your Blog?

Then you have to check out my blog. I have found a FREE and Legitimate way that will increase your earnings.

Come Check us out. How to Boost Your AdSense Revenue

4:27 pm  
Blogger Johnny said...

Traffic is the life of every website. This free traffic handbook is helpful and update, read it carefully and apply the methods it mentioned, your website traffic will boost!

11:47 am  
Anonymous Anonymous said...

GET PAID TO DRIVE YOUR OWN CAR.... BETTER YET GET A FREE CAR -- GET PAID UP TO £1200 A MONTH
This is no scam. This is a genuine offer for you to earn some good cash for doing nothing but drive a car.
Get Paid To Drive in UK Now

The BIGGEST advertising coup has been taking the United States of America by storm and now it's
available in the United Kingdom! Companies will pay you a monthly fee to display ads on your car!

We offer an introduction to the UK companies that are operating in a fantastic new media, Car Wrapping. You will have seen the promo cars driving around in your area and possibly thought the driver worked for the company.

Get Paid To Drive in UK Now

You were most likely wrong. The driver was driving around in a free car or was being paid. Now you can have access to all the companies in one place.

Get Paid To Drive in UK Now

People all over the World are being paid to drive their cars and now if you live in the UK you can also be paid. By simply driving their car the way they ordinarily would, they are also making up to £1200 per month!

If you are willing to drive your car with a company advertisement on it to your job, the shops, school runs etc., there are companies in the UK looking to pay you to do this - GUARANTEED. This is an ideal way for anyone to earn some additional income!
Companies want to give you money for you to DRIVE your own car. They just add advertisements on your car. That's it!

Get Paid To Drive in UK Now

WHAT'S THE CATCH? There isn't! You can drive as you normally do and get paid for it
Who Qualifies...

You must be 18 years of age or older, possess a valid drivers license and fill out the required application for each programme you wish to join.
You must be a citizen or permanent resident of one of the The United Kingdom.
Get Paid To Drive in UK Now

Your driving record, driving habit, location etc will be taken into consideration by the advertiser during the selection process. Most companies require a minimum monthly driving mileage and a clean driving record (at least no driving offences within the past 12 months). PaidtoDrive.co.uk does not pay you to advertise and cannot guarantee your acceptance into any programmed you sign up for. We can, however, guarantee the legitimacy of these programs and the application process.
Get Paid To Drive in UK Now

In the event you have been convicted of a driving offence, driving under the influence of drugs/alcohol, or had more than two serious motor accidents in the last two years, we cannot guarantee that your application will be accepted and strongly urge you not to continue any further.

Please visit our frequently asked questions section if you have further questions. Alternatively you can email me at sales@paidtodrive.co.uk
Yours Faithfully,
www.PaidtoDrive.co.uk
Team

Get Paid To Drive in UK Now

3:29 pm  
Blogger Tonythebest said...

casino free online To play free of charge casino free online Free software. casino free online

11:12 am  
Blogger Infactahost.com said...

Hey, you have a great blog here! I'm definitely going to bookmark you!

I have a exchange portal traffic site/blog. It pretty much covers exchange portal traffic related stuff.

Come and check it out if you get time :-)

11:51 am  
Blogger Infactahost.com said...

Hey, you have a great blog here! I'm definitely going to bookmark you!

I have a qualified web site traffic site/blog. It pretty much covers qualified web site traffic related stuff.

Come and check it out if you get time :-)

1:27 pm  
Blogger Mike said...

Bling Bling everyone. Good to see some bling ice stuff around. Good work with your blog. Check out some great bling ice goodies here.

1:32 pm  
Anonymous Anonymous said...

RSS Announcer instantly and automatically submits your RSS feeds

5:28 pm  
Anonymous Anonymous said...

What If This Could All Happen Automatically,
with a simple push of a button.....

6:56 pm  
Anonymous Anonymous said...

which sends to over 700 MILLION people a day.

8:50 am  
Blogger Goodman441 said...

Does anyone here know of better ways to increase Adsense income? I have been trying to get people to my site at: www.ickaboo.com for some time. Can anyone help me out?

10:55 am  
Anonymous Anonymous said...

Hey, you have a great blog here! I'm definitely going to bookmark you! The information and Internet marketing product evaluations that you provide are great for beginner webmasters.

I have a online business auction site/blog. It pretty much covers online business auction related stuff.

Come and check it out if you get time :-)

2:04 pm  
Blogger Infactahost.com said...

Hey, you have a great blog here! I'm definitely going to bookmark you!

I have a travel link exchange site/blog. It pretty much covers travel link exchange related stuff.

Come and check it out if you get time :-)

11:55 pm  
Anonymous Anonymous said...

Great blog, I also have a casino related site, If you want or need more exposure get casino traffic by the thousands at **casino traffic** Works for me!

5:47 am  
Anonymous Anonymous said...

GROW IT YOURSELF!

7:13 am  
Blogger Brian said...

Hey, you have a great blog here! I'm definitely going to bookmark you!

I have a internet advertising consultant site/blog. It pretty much covers internet advertising consultant related stuff.

Come and check it out if you get time :-)

8:46 am  
Blogger Johnny said...

Every online business need free traffic. This free traffic handbook is very update and helpful.

9:29 pm  
Anonymous Anonymous said...

Last month I made $12,124 with Google Adsense...Click
here for free on how you can do the same!

11:49 pm  
Anonymous Anonymous said...

Hey, you have a great blog here! I'm definitely going to bookmark you!

I have a ffa site/blog. It pretty much covers ffa related stuff. Plus you can advertise to billions using our ffa tools.

Come and check it out if you get time :-)

10:38 am  
Anonymous Anonymous said...

I like your blog, and will add it to "my favorites". I am new to blogging, but not new to car clubs. I have furnished custom made car badges to dozens of car clubs all over the country. I have a web site that I feel you will find both interesting and informative. Please pay me a visit when you have time.
**car clubs**car club pittsburgh

6:05 pm  
Blogger clandis said...

Considering free checking richmond ? You'd do better by checking out Fee Free Bank .com . At least a $25 bonus for opening a new account, with bonuses as high as $1,500 ! You save more and get a higher interest rate to make YOUR money work for YOU.

10:32 pm  
Blogger Living in Thailand said...

Nice site maybe we can do something!Free SMS and Free Fax

8:45 pm  
Blogger Living in Thailand said...

Hi Nice blog please take look at my website as well *My free sms website**

10:05 pm  
Blogger Roberto Iza Valdes said...

This comment has been removed by a blog administrator.

2:42 am  
Blogger job opportunitya said...

Irresistible blog. I look for blogs like this one
when time allows me to. I enjoyed the site and I'll
check it next time!
Please consider looking at my plastic surgery chicago blog.

9:30 am  
Anonymous Barry said...

For great prices and those hard to get items just check us out at http://www.bnbshoppersnetwork.com

2:10 am  
Anonymous My Bonus Area said...

legitimate work at home jobs,http://allmyvista.com,legitimate work at home jobs

free downloads of software, php scripts, audio, ebooks and seminar interviews. Make work from home incredibly easy

legitimate work at home jobs

http://allmyvista.com

legitimate work at home jobs

7:53 am  
Blogger William said...

Great blog you have here I will deffinitely be back, I have a website that is about restoring wooden boats

http://www.classicwoody.com/ : complete wooden boat restoration guide

6:26 am  
Anonymous Anonymous said...

Hi :)

You have a great blog! I'll make sure to visit regularly. Keep blogging!

I have a website on Website Traffic which you might be interested in. Please check it out if you get some time :)

6:34 am  
Blogger William said...

Great blog you have here, I will definitely be back. I have a website that might be of interest to you. It has products at wholesale prices, great place to hang out.
wholesale furniture

4:59 am  
Anonymous Golf Schools said...

Thanks for all the great comments and insights..By the way, are you looking for more information on Golf Set ..If so here is a fantastic resource for everything related to biking and Golf Set with information, products, articles and more..Check it out here...http://www.kgolf.net/

10:14 pm  
Anonymous Anonymous said...

http://www.365dayz.comOpen365dayz.com is now open. Click http://www.365dayz.com

9:46 am  
Anonymous Anonymous said...

Great blog. Visit my home business page.

3:59 am  
Anonymous Anonymous said...

Good post

1:41 am  
Blogger James Baker said...

Hi, Fellow!I like your blog!
I just came across your blog and wanted to
drop you a note telling you how impressed I was with
the information you have posted here.
I have a buffalo news job finder
site. It pretty much covers buffalo news job finder related subjects.
Come and check it out if you get time :-)
Best regards!

7:14 am  
Blogger Casino Online said...

Hi, Thanks for your interesting blog. Keep up the great work! I also have a site & blog about casino gambling.casino light.com, please feel free to visit.

4:22 am  
Blogger born2-live said...

Great blog. I surf the web looking for blogs like
this. Your site was on point and will be back again!
Please go over my fast cash advance blog.

12:42 am  
Blogger Joe Berenguer said...

Hi Blogger!I like your blog! Keep up the
good work, you are providing a great resource on the Internet here!
If you have a moment, please take a look at my site:
yahoo job bank
It pretty much covers yahoo job bank related issues.
Best regards!

6:01 am  
Blogger All about Golf said...

Hi thanks for your blog, I liked it! I also have a blog/site about vegas golf that covers vegas golf related stuff. Please feel free to visit.

8:01 am  
Anonymous scientific marketing said...

I have a request in regards to scientific marketing... What are a few ways you've tested that has brought you a great deal of quality, high-conversion web traffic?

Thanks for your suggestions!

-The Marketing Machine
scientific marketing

12:20 pm  
Anonymous ADVERTISING said...

Want top search engine ranking? try my software Free ADVERTISING check it out.

10:01 am  
Anonymous Anonymous said...

Hi ##name##. There are many different ways to earn money onlineadvertising. I continue to look for different ways to promote my sites and business without going broke. let me know what you all are seeing out there.advertising

2:37 pm  
Anonymous Anonymous said...

Unbelievable! Thanks.
Was searching for traffic broker.
http://www.1st-choice-4-website-traffic.com
traffic broker

6:31 am  
Anonymous Fast said...

Hello,

I am writing to tell you that your site is wonderful. I would be pleased if you could send me some further information as soon as possible.

Regards,
start online business

11:48 pm  
Anonymous Search Engine Related Traffic said...

Want top search engine ranking? try my software Free Search Engine Related Traffic check it out.

4:09 am  
Anonymous Anonymous said...

Pleasing blog. Thanks!
http://www.1st-choice-4-website-traffic.com
Searching blogs for improve traffic.

8:50 am  
Blogger Scott A. Edwards said...

Here it is... FREE advertising, FREE download. No cost to you! Get your FREE download NOW! Make money and get FREE advertising! This is a great program for you to take advantage of... Check this out now for FREE!

To find out more visit: money making opportunity on the internet site. It successfully exposes FREE information covering traffic and money making opportunity on the internet related stuff. Don't forget, FREE, FREE, FREE!!!

1:19 pm  
Anonymous Scott Arthur Edwards said...

As a special token of my appreciation for all your kind help and the wonderful business you have sent my way---I want to give you a free gift.
It is called the "$25000.00 Idea". It will help you in all your endeavors.
Click here: FREE GIFT

9:09 am  
Anonymous Scott Arthur Edwards said...

The fact is that the INTERNET is making people RICH! Shouldn't YOU be one of them? Click here: FIND OUT NOW!

2:35 am  
Anonymous SEO said...

Want top search engine ranking? try my software Free SEO check it out.

11:03 am  
Anonymous Anonymous said...

Want top search engine ranking? try my software Free check it out.

3:57 pm  
Anonymous Anonymous said...

Want top search engine ranking? try my software Free check it out.

9:04 am  
Blogger Advertising Center said...

I just came across your blog and wanted to drop you a note telling you how impressed I was with the information you have posted here.
I also have a web site & blog about yellow page advertising
so I know what I'm talking about when I say your site is top-notch! Keep up the great work!

12:02 pm  
Anonymous Anonymous said...


job posting Earn $5 to $75 per survey.

Earn Extra Income Part-Time Anytime Anywhere. How Much Does Your Opinons Worth? Supplement Your Salary. Earn Extra Money Part-time.

Do you have an opinon? Get paid to take Online Paid Survey. Participate in Online Paid Survey and get paid for taking online paid surveys. You can earn between $5 to $75 per survey.

Earn money part-time for taking online surveys. job posting

1:34 pm  
Anonymous make money online said...

Hi, did you know you can make money online using Google Adsense and clickbank.com totally for free? Come see bestinternetearnings.com

11:25 am  
Blogger make money online free! said...

Sure, making money online is possible! Take www.richin2006.com. This guy will show you how to work from home and earn cash. It belongs to a marketer who wants to help you succeed online. Check it out! Become Rich in 2006!

10:25 am  
Blogger Kate said...

Your blog is a nice source of builder site traffic web related information. I liked reading it.
Regards, Website Traffic Info

6:43 am  
Anonymous grcr1 said...

All I can say is ...wow! Simply liking your site, good posts and very cool.

Have A Nice blogging day,
work from home doing data entry

10:53 pm  
Anonymous Anonymous said...

Debt Settlement
Debt Relief can help you reduce your interest burden by charging an interest rate lower than the rate on your existing loans. Debt consolidation loan can also allow you to make small monthly payments by extending the loan period
http://www.debt1consolidation.com
Debt Settlement
Debt Relief can help you reduce your interest burden by charging an interest rate lower than the rate on your existing loans. Debt consolidation loan can also allow you to make small monthly payments by extending the loan period
http://www.debt1consolidation.com

11:28 am  
Blogger Michelle said...


jobs Earn $5 to $75 per survey.

Earn Extra Income Part-Time Anytime Anywhere. How Much Does Your Opinons Worth? Supplement Your Salary. Earn Extra Money Part-time.

Do you have an opinon? Get paid to take Online Paid Survey. Participate in Online Paid Survey and get paid for taking online paid surveys. You can earn between $5 to $75 per survey.

Earn money part-time for taking online surveys. jobs

11:15 am  
Anonymous Anonymous said...

Walter Sucks
Walter is A THIEF Scam Walter owes me $4000.00
http://www.Superblogsubmittersucks.com

5:11 am  
Anonymous Anonymous said...

Your Blog is Awesome. I am glad that I got a chance to come by and check it out. I am always looking for hot information that will help my online business to flourish.http://www.affiliatehomebasedbusiness.com

1:37 pm  
Anonymous Scott Arthur Edwards said...

Check this out for FREE...

This opportunity says:

"Your Ad" Will Be Instantly Displayed on Thousands of Websites and Read By Over 10 Million People Per Week For FREE, and It Only Takes 60 Seconds To Get Started!

To find out more visit: partners site. It successfully exposes FREE information covering Traffic and partners related stuff.

8:18 am  
Blogger TonyJ said...

Looking for the best in electronic products? Well, a visit to http://www.make-money-online-biz.info can solve all your problems today. Browse the various categories like tpye at home and find the product that you have been searching for.

2:32 am  
Anonymous Anonymous said...

Hey Guys if you have been dumped by adsense or given the run around by Yahoo then you need to look at this, Fair Ads Network are only taken 10,000 members then they are closing the doors, I suggest that you take a look Now before its too late : http://fairadsnetwork.com/034704959097

1:03 am  
Anonymous Anonymous said...

Great blog....now...ADVICE TIME!! - If you need more guaranteed targeted web site traffic then congratulations I've come to the right place, try guaranteed targeted web site traffic - this is the best place online to get massive volumes of internet traffic back to your blog for blog publicity purposes. Within a week I had trippled my volume of traffic - Signup is free and before you know it you will flying up the Google search egine - guaranteed!! - Signup is free you have nothing to lose. Best of luck with it and continued success with your blog!!

6:24 am  
Anonymous Anonymous said...

Nice blog!! I'm into making money in real estate and to drive traffic to my website I signed up free for this superb traffic gereating tool - I now have loads of hits to my websites and blogs. This can see your affiliate commission shoot through the roof - meaning lots of extra money coming in for you and your family. Sign up now - it's free.. Best of luck, cheers for now, dave.

2:30 pm  
Anonymous Anonymous said...

american express job site web

1:34 pm  
Blogger Scott A. Edwards said...

Warning: If you would like to make big money doing only 30 minutes per day of the easiest work you've ever done... Without having to leave your home, talk to anyone or sell anything... Then READ the following message to find out more... The AntiBusiness

11:40 pm  
Anonymous Anonymous said...

BUILD YOUR LIST, WIN THE WEEKLY DRAW, EARN MONEY! Learn more about it here: home business site. It pretty much covers home business related stuff and it is FREE to join.

11:54 pm  
Anonymous Anonymous said...

http://www.adquity.com
Classifieds for our community. Buy, sell, trade, date, events... post anything. Adquity Classifieds.

http://www.adquity.com

8:45 pm  
Anonymous Anonymous said...

i love new show television york

8:13 pm  
Anonymous Anonymous said...

business dispute lawyer new york

7:52 pm  
Anonymous Anonymous said...

business dispute lawyer new york

10:18 pm  
Anonymous Anonymous said...

ecommerce business

2:56 pm  
Anonymous Anonymous said...

it has become very easy to borrow loans these days. Advancements in technology particularly with the Internet have made it convenient for loan seekers to track the loan of their choice. With just a few clicks on a lender's website you can access the desired loan online. The ease with which loans are available online nowadays is the main reason behind the growing number of debt-related problems.

The vast number of loans taken on different occasions may have benefited you many times and may have even been a lifesaver in an urgent situation. However, you may not have known that these loans can pose a threat to you. Now you have to remember which lender to pay, how much and when. Failing to pay any of the installments on the loan may affect your credit score adversely. In such circumstances, debts become a burden. You may get into a life-long debt trap if you don't know how to handle these debts. A debt management program in such conditions can work as an effective debt management tool helping you in reducing the debt burden.

Here are a few debt management tips that can help you in managing your debts and getting your life back on the right track:

Create A Budget
An organized and well-planned budget can help you in keeping control over your monthly expenses. Write down each and every financial transaction you do each month; this will help you stay on track. It will give you a real idea of your finances and thus you can make the decision accordingly. A budget will give you an overview about how many funds you do have and how you are going to disburse the expenses with the available money. Setting up the budget is not enough: what is important is to stick to it.

Consolidate High Interest Loans
Consolidate your debts that carry a high rate of interest with a debt consolidation loan. A debt consolidation loan can work as an effective debt management tool. It will help you in getting rid of the debt burden by reducing the monthly outgoings. With a debt consolidation loan, you will get freedom from all the hassles involved in dealing with several creditors, you will be accountable to only one loan, one lender and one lower monthly installment.

Avoid taking on new credit
If you are already in a debt trap, avoid taking up a new loan. Borrowing a new loan may be of great help to you, but it will be in the short term. It may increase the debt burden and will add to your troubles rather then solving them.

Debt Management Counseling
You can also seek for advice from debt management counselors. The majority of the lenders in the US engage debt management counselors who have years of experience and can provide you with an easy road map to get rid of the debt trap by paying off the existing debts.

Learn To Save
A need for a loan arises when you do not have sufficient funds in your saving account to meet your personal desires. Make saving a habit, try not to overspend on unnecessary things. No, don't become a miser but use the funds carefully, a little sum of money saved today will be highly beneficial for you in the future and will make it easy for you to deal emergency cash need with the available funds on the right time and in the right manner.

Debt management is a time-consuming process. You can save your time and hard-earned money by employing a debt management company who will take care of your debt and can offer effective solutions to all your debt-related problems.

Tips for managing debts employed in the right manner can curb the menace created by debts, helping you get out of debt in an easier way. Paying off the existing debts will help you in securing a smoother and easier life for the future

6:38 pm  
Anonymous Anonymous said...

it has become very easy to borrow loans these days. Advancements in technology particularly with the Internet have made it convenient for loan seekers to track the loan of their choice. With just a few clicks on a lender's website you can access the desired loan online. The ease with which loans are available online nowadays is the main reason behind the growing number of debt-related problems.

The vast number of loans taken on different occasions may have benefited you many times and may have even been a lifesaver in an urgent situation. However, you may not have known that these loans can pose a threat to you. Now you have to remember which lender to pay, how much and when. Failing to pay any of the installments on the loan may affect your credit score adversely. In such circumstances, debts become a burden. You may get into a life-long debt trap if you don't know how to handle these debts. A debt management program in such conditions can work as an effective debt management tool helping you in reducing the debt burden.

Here are a few debt management tips that can help you in managing your debts and getting your life back on the right track:

Create A Budget
An organized and well-planned budget can help you in keeping control over your monthly expenses. Write down each and every financial transaction you do each month; this will help you stay on track. It will give you a real idea of your finances and thus you can make the decision accordingly. A budget will give you an overview about how many funds you do have and how you are going to disburse the expenses with the available money. Setting up the budget is not enough: what is important is to stick to it.

Consolidate High Interest Loans
Consolidate your debts that carry a high rate of interest with a debt consolidation loan. A debt consolidation loan can work as an effective debt management tool. It will help you in getting rid of the debt burden by reducing the monthly outgoings. With a debt consolidation loan, you will get freedom from all the hassles involved in dealing with several creditors, you will be accountable to only one loan, one lender and one lower monthly installment.

Avoid taking on new credit
If you are already in a debt trap, avoid taking up a new loan. Borrowing a new loan may be of great help to you, but it will be in the short term. It may increase the debt burden and will add to your troubles rather then solving them.

Debt Management Counseling
You can also seek for advice from debt management counselors. The majority of the lenders in the US engage debt management counselors who have years of experience and can provide you with an easy road map to get rid of the debt trap by paying off the existing debts.

Learn To Save
A need for a loan arises when you do not have sufficient funds in your saving account to meet your personal desires. Make saving a habit, try not to overspend on unnecessary things. No, don't become a miser but use the funds carefully, a little sum of money saved today will be highly beneficial for you in the future and will make it easy for you to deal emergency cash need with the available funds on the right time and in the right manner.

Debt management is a time-consuming process. You can save your time and hard-earned money by employing a debt management company who will take care of your debt and can offer effective solutions to all your debt-related problems.

Tips for managing debts employed in the right manner can curb the menace created by debts, helping you get out of debt in an easier way. Paying off the existing debts will help you in securing a smoother and easier life for the future

6:40 pm  
Anonymous Anonymous said...

A payday loan or paycheck advance is a small, short-term loan that is intended to cover a borrower's expenses until his or her next payday. Typical loans are between $100 and $1500, on a two-week term and have interest rates in the range of 390 percent to 900 percent (annualized). The loans are also sometimes referred to as cash advances, though that term can also refer to cash provided against a prearranged line of credit such as a credit card.

Though payday lending is primarily regulated at the state level, the United States Congress passed a law in October 2006 that caps lending to military personnel at 36% APR. The Defense Department called payday lending practices "predatory," and military officers cited concerns that payday lending exacerbated soldiers' financial challenges, jeopardized security clearances, and even interfered with deployment schedules to Iraq.

Some federal banking regulators and legislators seek to restrict or prohibit the loans not just for military personnel, but for all borrowers [citation needed, because the high costs are viewed as an unnecessary financial drain on the lower and lower-middle class populations who are the primary borrowers.

Lenders say these loans are often the only option available to consumers with bad credit or who cannot get a bank loan, credit card, or other lower-interest alternatives. Critics counter most borrowers find themselves in a worse position when the loan is due than they were when they took the loan, with many getting trapped in a cycle of debt.

The industry's fast-paced growth indicates a highly profitable business model. Statistics compiled by the Center for Responsible Lending show that the majority of the industry's profit comes from repeat borrowers who are unable to repay loans on the due date and instead repeatedly renew their loans, paying fees each time

Borrowers visit a payday lending store and secure a small cash loan, usually in the range of $100 to $500 with payment in full due at the borrower's next paycheck (usually a two week term). Finance charges on payday loans are typically in the range of $15 to $30 per $100 borrowed for the two-week period, which translates to rates ranging from 390 percent to 780 percent when expressed as an annual percentage rate (APR). The borrower writes a post-dated check to the lender in the full amount of the loan plus fees. On the maturity date, the borrower is expected to return to the store to repay the loan in person. If the borrower doesn't repay the loan in person, the lender may process the check traditionally or through electronic withdrawal from the borrower's checking account.

If the account is short on funds to cover the check, the borrower may now face a bounced check fee from their bank in addition to the costs of the loan, and the loan may incur additional fees and/or an increased interest rate as a result of the failure to pay. For customers who cannot pay back the loan when due, members of the national trade association are required to offer an extended payment plan at no additional cost. In states like Washington, extended payment plans are required by state law.

Payday lenders require the borrower to bring one or more recent pay stubs to prove that they have a steady source of income. They are also required to provide recent bank statements. Individual companies and franchises have their own underwriting criteria.



Online payday loans are marketed through e-mail, online search, paid ads, and referrals. Typically, a consumer fills out an online application form or faxes a completed application that requests personal information, bank account numbers, Social Security number and employer information. Borrowers fax copies of a check, a recent bank statement, and signed paperwork. The loan is direct deposited into the consumer's checking account and loan payment or the finance charge is electronically withdrawn on the borrower's next payday.



For example, a borrower seeking a payday loan may write a post-dated personal check for $460 to borrow $400 for up to 14 days. The payday lender agrees to hold the check until the borrower's next payday. At that time, the borrower has the option to redeem the check by paying $460 in cash, or renew the loan ( a.k.a. "flip the loan") by paying off the $460 and then immediately taking an additional loan of $400, in effect extending the loan for another two weeks. In many states, "flipping" or "rolling over" the loan is not allowed. In states where there is an extended payment plan, the borrower could choose to opt into a payment plan. If the borrower does not refinance the loan, the lender may deposit the check. In this example, the cost of the initial loan is a $60 finance charge, or 390% percent APR.

When the Consumer Federation of America conducted a survey of 100 internet payday loan sites, it found loans from $200 to $2,500 were available, with $500 the most frequently offered. Finance charges ranged from $10 per $100 up to $30 per $100 borrowed. The most frequent rate was $25 per $100, or 650% annual interest rate (APR) if the loan is repaid in two weeks.



Regulation of lending institutions is handled primarily by individual states, and this growing industry exists atop an active and shifting legal landscape. Lenders lobby to enable payday lending practices, while opponents of the industry lobby to prohibit the high cost loans in the name of consumer protection.

Payday lending is legal and regulated in 37 states. In Georgia and 12 other states, it is either illegal or not feasible, given state law.When not explicitly banned, laws that prohibit payday lending are usually in the form of usury limits: hard interest rate caps calculated strictly by APR.

In the United States, most states have usury laws which forbid interest rates in excess of a certain APR. Payday lenders have succeeded in getting around usury laws in some states by forming relationships with banks chartered in a different state with no usury ceiling (such as South Dakota or Delaware). This practice has been referred to as "Rate exportation", the "agency model" and the "rent-a-bank" model. Under the legal doctrine of rate exportation, established by Marquette Nat. Bank v. First of Omaha Corp. 439 U. 299 (1978), the loan is governed by the laws of the state the bank is chartered in. This is the same doctrine that allows credit card issuers based in South Dakota and Delaware — states that abolished their usury laws — to offer credit cards nationwide.As federal banking regulators became aware of this practice, they began prohibiting these partnerships between commercial banks and payday lenders. The FDIC still allows its member banks to participate in payday lending, but it did issue guidelines in March 2005 that are meant to discourage long term debt cycles by transitioning to a longer term loan after 6 payday loan renewals.

For usury laws to be effective, they need to include all loan fees as part of the interest. Otherwise, lenders can charge any amount they want as fees and still claim a low interest rate.

Some states have laws limiting the number of loans a borrower can take at a single time. Some states also cap the number of loans per borrower per year, or require that after a fixed number of loan-renewals, the lender must offer a lower interest loan with a longer term, so that the borrower can eventually get out of the debt cycle. Borrowers often circumvent these laws by taking loans from more than one lender.



On March 1, 2006, the North Carolina Department of Justice announced the state had negotiated agreements with all the payday lenders operating in the state. The state contended that the practice of funding payday loans through banks chartered in other states illegally circumvents North Carolina law. Under the terms of the agreements, the lenders will stop making new loans, will collect only principal on existing loans and will pay $700,000 to non-profit organizations for relief.



Georgia law prohibited payday lending for more than 100 years, but the state was not successful in shutting the industry down until the 2004 legislation made payday lending a felony, allowed for racketeering charges and permitted potentially costly class-action lawsuits.

New Mexico will cap fees, restrict total loans by a consumer and prohibit immediate loan rollovers, in which a consumer takes out a new loan to pay off a previous loan, under a new law that takes effect November 1, 2007. A borrower who is unable to repay a loan will automatically be offered a 130-day payment plan, with no fees or interest. Once a loan is repaid, under the new law, the borrower must wait 10 days before obtaining another payday loan. The law will allow the term of a loan to run from 14 to 35 days, with the fees capped at $15.50 for each $100 borrowed. There also will be a 50-cent administrative fee to cover costs of lenders verifying whether a borrower qualifies for the loan, such as determining whether the consumer is still paying off a previous loan. A borrower's cumulative payday loans could not exceed 25 percent of the individual's gross monthly income.



According to the Canadian Criminal Code, any rate of interest charged above 60% per annum is considered criminal. On August 14, 2006 the Supreme oBritishColumbiassued its decision in a class action lawsuit against A OK Payday Loans. A OK charged its customers 21% interest, as well as a "processing" fee of C$9.50 for every $50.00 borrowed. In addition a "deferral" fee of $25.00 for every $100.00 was charged if a customer wanted to delay payment. The judge ruled that the processing and deferral fees were interest, and that A OK was charging its customers a criminal rate of interest. The payout as a result of this decision is expected to be several million dollars The British Columbia Court of Appeal unanimously affirmed this decision. Federal legislation passed in the spring of 2007 transferred regulatory authority on payday loans to the provinces.



Payday lending is a controversial practice and faces both legal battles and public perception challenges in nearly every state.



Critics blame payday lenders for exploiting people's financial hardship for profit. Lenders target the young and the poor, particularly those near military bases and in low-income communities. Borrowers may not understand that the high interest rates are likely to trap them in a "debt-cycle," where they have to repeatedly renew the loan and pay associated fees every two weeks until they can finally save enough to pay off the principal and get out of debt. Critics point out that payday lending unfairly disadvantages the poor, compared to the middle class who pay at most 25% or so on their credit cards.

However, supporters argue that some individuals that require the use of payday loans have already exhausted or ruined any other alternatives. They may not be able to obtain a credit card, or rely on secondary sources (such as loans from friends and family members)



By law, a payday lender can use only the same industry standard collection practices used to collect other debts.

In many cases, the borrower has written a post-dated check to the lender; if the borrower defaults, then this check will bounce. Some payday lenders have therefore threatened delinquent borrowers with criminal prosecution, for check fraud. This practice is illegal in many jurisdictions and has resulted in regulatory action.



Defenders of the higher interest rates say processing costs for payday loans do not differ much from other loans, including home mortgages. They argue that conventional interest rates for lower dollar amounts and shorter terms would not be profitable. For example, a $100 one-week loan, at a 20% APR (compounded weekly) would generate only 38 cents of interest, which would fail to match loan processing costs.

Critics say payday lenders' processing costs are significantly lower than costs for mortgages and other traditional loans. Payday lenders usually look at recent pay-stubs, whereas larger-loan lenders do full credit checks and making a determination about the borrower's ability to pay back the loan.



A study by the FDIC Center for Financial Research found "operating costs lie in the range of advance fees" collected and that, after subtracting fixed operating costs and "unusually high rate of default losses," payday loans "may not necessarily yield extraordinary profits." Based on the annual reports of publicly traded payday loan companies, loan losses can average 15% or more of loan revenue. Underwriters of payday loans must also deal with people presenting fraudulent checks as security or making stop payments.

Critics concede that some borrowers may default on the loans, but point to the industry's pace of growth as an indication of its profitability. Consumer advocates condemn the practice as a whole, regardless of its profitability, because it "takes advantage of consumers who are already hard-pressed to pay their debts".

Proponents claim that cash advance loans provide a service that is not available from other sources. Many credit unions have attempted to offer similar products, but have been unable to do so without government subsidies or grants, a fact that many lenders and reports have highlighted. Furthermore, most of these programs offered by credit unions have ended due to the high default rates of lenders.

A staff report released by the Federal Reserve Bank of New York concluded that payday loans should not be categorized as "predatory" since they may improve household welfare. "Defining and Detecting Predatory Lending" reports "if payday lenders raise household welfare by relaxing credit constraints, anti-predatory legislation may lower it." The author of the report, Donald P. Morgan, defined predatory lending as "a welfare reducing provision of credit." Results of the report indicated that payday loans may actually do the opposite by improving the welfare of the consumer.



Many believe that payday loans are the only option for consumers with bad credit, but other options do exist and most financial counselors would direct people to explore the alternatives. Other options are available to most payday loan customers.These include credit union loans with lower interest and more stringent terms credit payment plans, paycheck cash advances from employers, bank overdraft protection, cash advances from credit cards, emergency community assistance plans, small consumer loans and direct loans from family or friends.

Payday lenders do not compare their interest rates to those of mainstream lenders. Instead, they compare their fees to the overdraft, late payment and penalty fees that will be incurred if the customer is unable to secure any credit whatsoever.

The lenders therefore list a different set of alternatives (costs expressed here as APRs for two-week terms):

$100 payday advance with $15 fee = 391% APR;
$100 bounced check with $48 NSF/merchant fees = 1,251% APR;
$100 credit card balance with $26 late fee = 678% APR;
$100 utility bill with $50 late/reconnect fees = 1,304% APR.


A minority of mainstream banks offer advances for customers whose paychecks or other funds are deposited electronically into their accounts. The terms are similar to those of a payday loan; a customer receives a predetermined cash credit available for immediate withdrawal. The amount is deducted, along with a fee, usually about 10 percent of the amount borrowed, when the next direct deposit is posted to the customer's account. After the programs attracted regulatory attention Wells Fargo called its fee "voluntary" and offered to waive it for any reason. It later scaled back the program in several states.

Income tax preparation firms often partner with lenders to offer "refund anticipation loans" to filers. These loans are not technically payday loans (because they are repayable upon receipt of the borrower's income tax refund, not at his next payday), but they have similar credit and cost characteristics. A car title loan is similar to a payday loan, but it is secured by the borrower's car. These loans are available only to borrowers who hold clear title ( i.e., no other loans) to a vehicle. The maximum amount of the loan is some fraction of the resale value of the car. These loans may be available on slightly better terms than an unsecured payday loan, since they are less risky to the lender. If the borrower defaults, then the lender can still recover costs by repossessing and reselling the car

9:09 pm  
Anonymous Anonymous said...

A payday loan or paycheck advance is a small, short-term loan that is intended to cover a borrower's expenses until his or her next payday. Typical loans are between $100 and $1500, on a two-week term and have interest rates in the range of 390 percent to 900 percent (annualized). The loans are also sometimes referred to as cash advances, though that term can also refer to cash provided against a prearranged line of credit such as a credit card.

Though payday lending is primarily regulated at the state level, the United States Congress passed a law in October 2006 that caps lending to military personnel at 36% APR. The Defense Department called payday lending practices "predatory," and military officers cited concerns that payday lending exacerbated soldiers' financial challenges, jeopardized security clearances, and even interfered with deployment schedules to Iraq.

Some federal banking regulators and legislators seek to restrict or prohibit the loans not just for military personnel, but for all borrowers [citation needed, because the high costs are viewed as an unnecessary financial drain on the lower and lower-middle class populations who are the primary borrowers.

Lenders say these loans are often the only option available to consumers with bad credit or who cannot get a bank loan, credit card, or other lower-interest alternatives. Critics counter most borrowers find themselves in a worse position when the loan is due than they were when they took the loan, with many getting trapped in a cycle of debt.

The industry's fast-paced growth indicates a highly profitable business model. Statistics compiled by the Center for Responsible Lending show that the majority of the industry's profit comes from repeat borrowers who are unable to repay loans on the due date and instead repeatedly renew their loans, paying fees each time

Borrowers visit a payday lending store and secure a small cash loan, usually in the range of $100 to $500 with payment in full due at the borrower's next paycheck (usually a two week term). Finance charges on payday loans are typically in the range of $15 to $30 per $100 borrowed for the two-week period, which translates to rates ranging from 390 percent to 780 percent when expressed as an annual percentage rate (APR). The borrower writes a post-dated check to the lender in the full amount of the loan plus fees. On the maturity date, the borrower is expected to return to the store to repay the loan in person. If the borrower doesn't repay the loan in person, the lender may process the check traditionally or through electronic withdrawal from the borrower's checking account.

If the account is short on funds to cover the check, the borrower may now face a bounced check fee from their bank in addition to the costs of the loan, and the loan may incur additional fees and/or an increased interest rate as a result of the failure to pay. For customers who cannot pay back the loan when due, members of the national trade association are required to offer an extended payment plan at no additional cost. In states like Washington, extended payment plans are required by state law.

Payday lenders require the borrower to bring one or more recent pay stubs to prove that they have a steady source of income. They are also required to provide recent bank statements. Individual companies and franchises have their own underwriting criteria.



Online payday loans are marketed through e-mail, online search, paid ads, and referrals. Typically, a consumer fills out an online application form or faxes a completed application that requests personal information, bank account numbers, Social Security number and employer information. Borrowers fax copies of a check, a recent bank statement, and signed paperwork. The loan is direct deposited into the consumer's checking account and loan payment or the finance charge is electronically withdrawn on the borrower's next payday.



For example, a borrower seeking a payday loan may write a post-dated personal check for $460 to borrow $400 for up to 14 days. The payday lender agrees to hold the check until the borrower's next payday. At that time, the borrower has the option to redeem the check by paying $460 in cash, or renew the loan ( a.k.a. "flip the loan") by paying off the $460 and then immediately taking an additional loan of $400, in effect extending the loan for another two weeks. In many states, "flipping" or "rolling over" the loan is not allowed. In states where there is an extended payment plan, the borrower could choose to opt into a payment plan. If the borrower does not refinance the loan, the lender may deposit the check. In this example, the cost of the initial loan is a $60 finance charge, or 390% percent APR.

When the Consumer Federation of America conducted a survey of 100 internet payday loan sites, it found loans from $200 to $2,500 were available, with $500 the most frequently offered. Finance charges ranged from $10 per $100 up to $30 per $100 borrowed. The most frequent rate was $25 per $100, or 650% annual interest rate (APR) if the loan is repaid in two weeks.



Regulation of lending institutions is handled primarily by individual states, and this growing industry exists atop an active and shifting legal landscape. Lenders lobby to enable payday lending practices, while opponents of the industry lobby to prohibit the high cost loans in the name of consumer protection.

Payday lending is legal and regulated in 37 states. In Georgia and 12 other states, it is either illegal or not feasible, given state law.When not explicitly banned, laws that prohibit payday lending are usually in the form of usury limits: hard interest rate caps calculated strictly by APR.

In the United States, most states have usury laws which forbid interest rates in excess of a certain APR. Payday lenders have succeeded in getting around usury laws in some states by forming relationships with banks chartered in a different state with no usury ceiling (such as South Dakota or Delaware). This practice has been referred to as "Rate exportation", the "agency model" and the "rent-a-bank" model. Under the legal doctrine of rate exportation, established by Marquette Nat. Bank v. First of Omaha Corp. 439 U. 299 (1978), the loan is governed by the laws of the state the bank is chartered in. This is the same doctrine that allows credit card issuers based in South Dakota and Delaware — states that abolished their usury laws — to offer credit cards nationwide.As federal banking regulators became aware of this practice, they began prohibiting these partnerships between commercial banks and payday lenders. The FDIC still allows its member banks to participate in payday lending, but it did issue guidelines in March 2005 that are meant to discourage long term debt cycles by transitioning to a longer term loan after 6 payday loan renewals.

For usury laws to be effective, they need to include all loan fees as part of the interest. Otherwise, lenders can charge any amount they want as fees and still claim a low interest rate.

Some states have laws limiting the number of loans a borrower can take at a single time. Some states also cap the number of loans per borrower per year, or require that after a fixed number of loan-renewals, the lender must offer a lower interest loan with a longer term, so that the borrower can eventually get out of the debt cycle. Borrowers often circumvent these laws by taking loans from more than one lender.



On March 1, 2006, the North Carolina Department of Justice announced the state had negotiated agreements with all the payday lenders operating in the state. The state contended that the practice of funding payday loans through banks chartered in other states illegally circumvents North Carolina law. Under the terms of the agreements, the lenders will stop making new loans, will collect only principal on existing loans and will pay $700,000 to non-profit organizations for relief.



Georgia law prohibited payday lending for more than 100 years, but the state was not successful in shutting the industry down until the 2004 legislation made payday lending a felony, allowed for racketeering charges and permitted potentially costly class-action lawsuits.

New Mexico will cap fees, restrict total loans by a consumer and prohibit immediate loan rollovers, in which a consumer takes out a new loan to pay off a previous loan, under a new law that takes effect November 1, 2007. A borrower who is unable to repay a loan will automatically be offered a 130-day payment plan, with no fees or interest. Once a loan is repaid, under the new law, the borrower must wait 10 days before obtaining another payday loan. The law will allow the term of a loan to run from 14 to 35 days, with the fees capped at $15.50 for each $100 borrowed. There also will be a 50-cent administrative fee to cover costs of lenders verifying whether a borrower qualifies for the loan, such as determining whether the consumer is still paying off a previous loan. A borrower's cumulative payday loans could not exceed 25 percent of the individual's gross monthly income.



According to the Canadian Criminal Code, any rate of interest charged above 60% per annum is considered criminal. On August 14, 2006 the Supreme oBritishColumbiassued its decision in a class action lawsuit against A OK Payday Loans. A OK charged its customers 21% interest, as well as a "processing" fee of C$9.50 for every $50.00 borrowed. In addition a "deferral" fee of $25.00 for every $100.00 was charged if a customer wanted to delay payment. The judge ruled that the processing and deferral fees were interest, and that A OK was charging its customers a criminal rate of interest. The payout as a result of this decision is expected to be several million dollars The British Columbia Court of Appeal unanimously affirmed this decision. Federal legislation passed in the spring of 2007 transferred regulatory authority on payday loans to the provinces.



Payday lending is a controversial practice and faces both legal battles and public perception challenges in nearly every state.



Critics blame payday lenders for exploiting people's financial hardship for profit. Lenders target the young and the poor, particularly those near military bases and in low-income communities. Borrowers may not understand that the high interest rates are likely to trap them in a "debt-cycle," where they have to repeatedly renew the loan and pay associated fees every two weeks until they can finally save enough to pay off the principal and get out of debt. Critics point out that payday lending unfairly disadvantages the poor, compared to the middle class who pay at most 25% or so on their credit cards.

However, supporters argue that some individuals that require the use of payday loans have already exhausted or ruined any other alternatives. They may not be able to obtain a credit card, or rely on secondary sources (such as loans from friends and family members)



By law, a payday lender can use only the same industry standard collection practices used to collect other debts.

In many cases, the borrower has written a post-dated check to the lender; if the borrower defaults, then this check will bounce. Some payday lenders have therefore threatened delinquent borrowers with criminal prosecution, for check fraud. This practice is illegal in many jurisdictions and has resulted in regulatory action.



Defenders of the higher interest rates say processing costs for payday loans do not differ much from other loans, including home mortgages. They argue that conventional interest rates for lower dollar amounts and shorter terms would not be profitable. For example, a $100 one-week loan, at a 20% APR (compounded weekly) would generate only 38 cents of interest, which would fail to match loan processing costs.

Critics say payday lenders' processing costs are significantly lower than costs for mortgages and other traditional loans. Payday lenders usually look at recent pay-stubs, whereas larger-loan lenders do full credit checks and making a determination about the borrower's ability to pay back the loan.



A study by the FDIC Center for Financial Research found "operating costs lie in the range of advance fees" collected and that, after subtracting fixed operating costs and "unusually high rate of default losses," payday loans "may not necessarily yield extraordinary profits." Based on the annual reports of publicly traded payday loan companies, loan losses can average 15% or more of loan revenue. Underwriters of payday loans must also deal with people presenting fraudulent checks as security or making stop payments.

Critics concede that some borrowers may default on the loans, but point to the industry's pace of growth as an indication of its profitability. Consumer advocates condemn the practice as a whole, regardless of its profitability, because it "takes advantage of consumers who are already hard-pressed to pay their debts".

Proponents claim that cash advance loans provide a service that is not available from other sources. Many credit unions have attempted to offer similar products, but have been unable to do so without government subsidies or grants, a fact that many lenders and reports have highlighted. Furthermore, most of these programs offered by credit unions have ended due to the high default rates of lenders.

A staff report released by the Federal Reserve Bank of New York concluded that payday loans should not be categorized as "predatory" since they may improve household welfare. "Defining and Detecting Predatory Lending" reports "if payday lenders raise household welfare by relaxing credit constraints, anti-predatory legislation may lower it." The author of the report, Donald P. Morgan, defined predatory lending as "a welfare reducing provision of credit." Results of the report indicated that payday loans may actually do the opposite by improving the welfare of the consumer.



Many believe that payday loans are the only option for consumers with bad credit, but other options do exist and most financial counselors would direct people to explore the alternatives. Other options are available to most payday loan customers.These include credit union loans with lower interest and more stringent terms credit payment plans, paycheck cash advances from employers, bank overdraft protection, cash advances from credit cards, emergency community assistance plans, small consumer loans and direct loans from family or friends.

Payday lenders do not compare their interest rates to those of mainstream lenders. Instead, they compare their fees to the overdraft, late payment and penalty fees that will be incurred if the customer is unable to secure any credit whatsoever.

The lenders therefore list a different set of alternatives (costs expressed here as APRs for two-week terms):

$100 payday advance with $15 fee = 391% APR;
$100 bounced check with $48 NSF/merchant fees = 1,251% APR;
$100 credit card balance with $26 late fee = 678% APR;
$100 utility bill with $50 late/reconnect fees = 1,304% APR.


A minority of mainstream banks offer advances for customers whose paychecks or other funds are deposited electronically into their accounts. The terms are similar to those of a payday loan; a customer receives a predetermined cash credit available for immediate withdrawal. The amount is deducted, along with a fee, usually about 10 percent of the amount borrowed, when the next direct deposit is posted to the customer's account. After the programs attracted regulatory attention Wells Fargo called its fee "voluntary" and offered to waive it for any reason. It later scaled back the program in several states.

Income tax preparation firms often partner with lenders to offer "refund anticipation loans" to filers. These loans are not technically payday loans (because they are repayable upon receipt of the borrower's income tax refund, not at his next payday), but they have similar credit and cost characteristics. A car title loan is similar to a payday loan, but it is secured by the borrower's car. These loans are available only to borrowers who hold clear title ( i.e., no other loans) to a vehicle. The maximum amount of the loan is some fraction of the resale value of the car. These loans may be available on slightly better terms than an unsecured payday loan, since they are less risky to the lender. If the borrower defaults, then the lender can still recover costs by repossessing and reselling the car

9:10 pm  

Post a Comment

<< Home