When you look under the hood, what you thought was a bargain might not always be the case. The problem is a lot of times we are blinded by the shiny finish and at times we just get in a hurry and don’t look closely at how the car runs or even the payments. We, maybe I’m talking about myself here, are impulsive and decide on something we just can’t afford and take the leap. But sometimes we feel that queasy feeling we should know it’s time to run.
Some things just don’t fit and some things shouldn’t fit and when something doesn’t fit it just doesn’t belong. You’ve read it here before and every time I think about it, I get more aggravated. When you hear the word “predatory” it does not give you a good feeling, although predatory birds and many other predatory animals are part of the balance of nature and are necessary. It’s part of the cycle of life, so to say. But when human beings are predators, it’s an entirely different story. Being human and being a predator just don’t fit together without someone losing and losing badly.
When people are predators and act out their peccadilloes they usually end up in jail or at least on “To Catch a Predator,” and … then go to jail. But there are other predators out there that never get caught and still others that stand in the sunlight and rake in the cash. Predatory lenders, such as title lenders, whose ethics are worse than a carnival huckster.
News outlets this week were buzzing with stories about title lenders circumventing a law passed in 2006 called the Military Lending Act, which effectively forbids the offering of payday and auto-title loans to active-duty service members.
If this law applies to lenders who prey on the military, why would we allow them to prey on Chesterfield citizens? Guess what? TitleMax, an auto title lender, is filing conditional-use applications with Chesterfield County. This week just as this paper hits the streets, TitleMax, will get a thumbs up or down from the Planning Commission. And where are these two title loan locations? On Jefferson Davis Highway, slightly over a mile apart; exactly where their favorite prey resides. Prey on those who can afford it the least. Tie ‘em up until they scream, and then pull the rope a little tighter.
The sad part is that if one of our county neighbors gets in a financial bind; offers his car as collateral on a loan, with an outrageous percentage rate; can’t keep up with the high interest loan; he loses his car.
Then he can’t get to work to try to get his car back or buy another. So we have a man in trouble, possibly with a family, and where are they going to turn?
According to a Propublica.org article, picked up by Yahoo News and the Consummerist among others, “There’s a Marine staff sergeant in South Carolina who, in desperate need of cash, signed up for a $1,600 auto-title loan — in which the borrower hands over the title to their car and a copy of their keys as collateral — that required him to pay back more than $17,000 over the course of 32 months, an APR of around 400 percent.”
But remember these articles are focused on members of the military. I repeat. Why would Chesterfield allow similar businesses in our county? Our county attorney and now an ordinance allows these businesses under a conditional-use permit. And while other alternative financial establishments restricted from operating out of the same storefront, such as payday lenders and consumer finance operations, check cashing can be located within the same roof as title loan companies. According to the FDIC, 28.3 percent of U.S. households either don’t have bank accounts or rely on alternative channels for financial services, such as check-cashing. Good thing is that the check-cashing businesses aren’t out to gut you financially. Even Walmart will cash a check for as little as $3.
According to a report by the Center for Responsible Lending, “Finds that there are nearly 8,000 auto-title lenders in 21 states. On average, borrowers who use these outlets renew their loans eight times, paying a total average interest amounting to $2,142 on $951 of credit. In other words, the APR on the average title loan is a whopping 225 percent.
It may be a little late for Chesterfield’s Planning Commission to deny the two TitleMax cases, but the Board of Supervisors can deny these cases and others. If my memory serves me right, these two cases are two of five that have been applied for.
Some would argue these “alternative financial institutes” are businesses only exercising their right in the free market and Chester field needs as many good businesses and jobs as the county can get. But I argue that if you want good quality business in Chesterfield, especially on this side of the county, you can’t load the roads with these types of operations. They will only keep good businesses from locating here.