I have been reading for the past several hours stories about people trapped in debt by payday lenders, title loan lenders and aggressive student loan collectors. The worst case of student loan collection was in New Jersey where a mother received a notice after her son had been killed that she was liable for his student loans.
The state aggressively pursues people offering little information about loan forgiveness and instead sends collection agencies to turn your life upside down. There was also no limit on the amount that a family could borrow, way beyond their ability to pay. As a last gasp some people declared bankruptcy, which could not eliminate the debts, but it greatly reduced their payments.
The stories of payday loans were equally as horrific. I noted that some unscrupulous lenders affiliated themselves with Native American tribes to escape state regulations. And some of them began to mutate as soon as one loan product was outlawed another sprang up. Like the installment loans which offer longer payment plans but interest just as high as their predatory cousins, allowing the crooked lenders to squeeze even more money out of workers.
I consider payday lenders a kind of guinea worm sucking up workers’ blood. And being trapped by payday loans, title loans and high student loan interest could lead a person to desperation. I am going to start following the good guys in this battle and seeing what ordinary citizens can do. The guinea worms have set up fake grassroots organizations to comment on proposed federal regulations and they spread money around to democrats and republicans in campaign contributions. Remember, always follow the money. When crooked politicians say there’s already too much regulation, find out where their cash is coming from. Stand up.