Payday loans are a type of consumer debt that is also referred to as cash advance loans and have very high lending charges.
They often fall under the term ‘predatory lending.’
Interest rates quite often reach more than 350% per annum and thereby making it very difficult for general consumers to pay them off, without sacrificing big amounts to penalty and burdening interests.
But one state is making a big change. The state is all geared up to bring an end to usurious lending practices. And for those who are already suffering from these types of payday loans or cash advances, there are new financial relief programs initiated by well-recognized organizations.
This is the state of Kansas vs. Payday Loan lending practices. Let the trial begin.
Kansas Loan Pool Project:
Also known by the short KLPP acronym, this is a collaborative project run by the chain of Catholic Charities and helps people in paying off multiple payday loans, by offering a low-interest consolidation loan.
Payday loan consolidation is truly an effective way to get rid of high-interest small loans. And this is probably the first time we are seeing a joint effort made by multiple organizations to help consumers consolidate payday loans.
This is a loan refinancing step, where payday loan victims will be given a personal loan sort of debt vehicle, with an amount greater than or equal to the consumers’ total payday loan balance. However, there are some terms and conditions, which you must adhere to, to get yourself benefitted from KLPP.
The biggest criterion is that you can’t have more than $1500 in your total payday loan debt. Plus, the Catholic Charities hold financial education courses, under the KLPP program, which you must not skip.
Also, your income needs to be valid and adequate, with a budget, assigned as a part of KLPP, asserting that you earn enough to pay off the new consolidation loan!
The state of Kansas is working to make Payday Lending better and more affordable:
Kansans for Payday Loan Reform is a coalition to fight against usurious and predatory lending practices.
Initiated in late 2019, this reform is designed to make credit available to general consumers at sensible and affordable lending charges.
Topeka JUMP website data reads that payday loans in Kansas can reach an interest rate increase to 391% per annum.
The website consensus also shows that in 2017, Kansas held a record of having nearly 3 times more payday loan venues than that of McDonald’s!
Topeka JUMP directly states its collaboration in bringing Payday Loan Reform in Kansas to a successful platform.
So, you need not to worry much now if you are a Kansan and are struggling with payday loans. You can pretty much expect to see a significant change in payday lending services by at least by the mid of 2020.
Stay tuned, to know more about such interesting newsbreaks!