Months back I blogged about payday loans and whether filing for bankruptcy relief can help a person break out of the debt cycle payday lending creates. Bankruptcy can absolutely provide an avenue to escape the debt trap of payday lending. But as a community are we willing to allow bankruptcy to be the only option in the face of such predatory lending? Payday loans are reprehensible in nature because the lenders intentionally prey upon the weakest and least financially sound members of our community. The payday lenders try to convince folks they are doing our community a favor by lending to people who would otherwise be shut out of traditional lending options. But in reality the only favor such lenders are interested in is favoring themselves and their right to pursue the almighty dollar on the backs of the poor in our state.
Alabama Leaders Allow Lending Reform Bill to Die
If the payday lenders really wanted to serve the good of the financially less fortunate in our communities, a reasonable business model could be implemented. It would still produce a reasonable profit for the business yet impose less onerous lending terms. That sounds like a good idea, right? Our state leaders should be all about finding ways to put that idea into play, right? Wrong. Once again in 2016 Alabama politicians allowed a payday lending reform bill to die on the vine in the Alabama legislative session. A group of ardent community activists, along with members of the faith based community in Alabama, diligently fought for payday lending reform that included, simply, fairer interest rates (instead of 456% interest) and longer repayment terms, ie six months instead of two weeks. Instead of thinking this was a good thing for the working people of Alabama, the Alabama House Financial Services Committee allowed the bill to die in committee. But consumer advocates have vowed to continue the fight for the people of Alabama. Instead of hopelessly giving up, Stephen Stetson of Alabama Arise, optimistically focused on the fact the payday reform bill got further in 2016 than it has ever gotten before. Alabama Arise will continue the fight in 2017 and Mr. Stetson encourages the people of Alabama “to remind elected officials of the constituents they really represent.”
So keep the faith Alabama. After all if the Speaker of the Alabama House of Representatives can be convicted and sentenced to prison for ethics violations it is all together possible for payday lending reform to see the light of day. Maybe one day.
If you are considering a filing for bankruptcy relief but are concerned about what the rules require and how they may affect you, please contact one of our locations nearest you in Alabama, Mississippi or Tennessee for a free, confidential consultation with one of our experienced, licensed attorneys.
Carla M. Handy is the Managing Partner of the Bond & Botes Law Offices in Gadsden and Anniston, Alabama. She holds a Bachelor of Arts from Auburn University, and a Juris Doctorate from the University of Alabama School of Law. She has been helping families navigate consumer bankruptcy cases since 1994.Read her full bio here.