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Birmingham, Alabama Announces a Temporary Ban on Payday Loans

The Birmingham city council recently announced that they will be placing a moratorium on payday loans for the next six months.

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PRLog (Press Release) - Dec. 7, 2011 - A long and rocky history with payday loan mayhem in the past few years culminated this week in a decision that will end payday loans in Birmingham for the next six months. Though the moratorium will only stay active for half a year, it has enraged many lenders in the area who have relied on Alabama citizens for their income. Government officials battled out opposing viewpoints in a court room on Tuesday morning before finally agreeing at a 7-2 vote to pass this new law.

The ban has stipulations. Existing payday loan and auto title stores can renew their business license within the next six months, but must stay where they are location-wise. Birmingham is home to 93 payday loan companies at present, and city residents frequent these stores for quick cash in a financial hardship. Some government authorities believe that these loans are creating a city debt and causing difficulty to borrowers. Payday loans come with higher interest rates than a long-term bank loan might, and many government officials believe these triple-digit APRs are what is hurting their community.

Payday lenders beg to differ with state officials. While lenders don’t deny that their interest rates are high, they also believe that they are able to help men and women who do not have any other access to cash. Payday loan companies don’t check credit, so anyone who is in need of some money fast, but lacking good credit can rely on a payday loan. Banks often reject these individuals at first glance. The high interest rates act as a security barrier and motivator for the payday loan companies, who hope that the rates will help push these bad-credit borrowers to repay their money on time. Payday loans are only meant to last a few weeks, so the loan’s short lifespan allows for less time paying interest and a faster process.

These loans are also more convenient than your average bank loan. Online short term loans are the way of the future, and take only minutes to secure. Unlike banks, which require painstaking application processes, online payday loans usually only have a small digital form that requires some basic information. Almost everyone who applies for a payday loan is accepted.

The Birmingham city council believes that their payday loan ban will help them to clarify the role payday loans have in the city and determine how to deal with this industry. They hope to seek other alternatives while they observe the repercussions of the moratorium. There is a danger that Birmingham’s short term loan customers will turn to over-drafting credit cards or other financial dangers without the help of a paycheck advance. These fees can add up to much more than a payday loan interest rate.

If you would like to learn more about payday loans and how they work, visit http://www.payday2go.com. We are an online payday loan and cash advance company that works hard to get you the cash you need when you need it most. We desire to give payday loans a good name by giving you the best loan we can at the lowest interest rates we can generate. Get started with us today and get the cash you need for any emergency.

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PayDay2Go is an online payday loan company working hard to give our customers the best loan we can. We are a matching service, and carefully review out customer’s applications before matching them with a lender. We want to strategically place borrowers with the right lender so that you will receive a satisfying loan. Get started with us today!

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Source:PayDay2Go
Phone:(866) 662-7297
Zip:34145
City/Town:Marco Island - Florida - United States
Industry:Banking, Finance, Business
Tags:PayDay2Go, payday loans, payday loans online, online payday loans, cash advance, alabama
Shortcut:prlog.org/11743989
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