Here is scary news: the American public now has a negative net savings rate. Home prices, medical care, and college tuition are all growing faster than wages, while debt has become increasingly pervasive among American households.

Individuals are aware of the problem, as 82 percent now recognize household debt as a serious dilemma, according to a recent survey sponsored by the Center for American Progress. So, why isn't the issue atop the agenga for national policymakers? Where do they weigh in when it comes to instant payday loan use?

The Center for American Progress survey found that both Republicans and Democrats (by more than 80 percent margins) agree that:

• There should be more incentives for people to save money
• Online payday loan lending companies should provide simple and uncomplicated language that explains their charges and fees
• More education and counseling should be provided to customers
• There should be caps on the rates of interest that credit card companies charge

So why have no real efforts been made on these fronts? The Center for American Progress has launched an effort to draw broader attention, especially among lawmakers, to the issue of household debt and overall quick payday loan use.

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First Bank of Delaware discontinued the use of payday loans a few months ago. We had the report.

Now, the company has announced it’s also dropping tax refund anticipation loans. These resources are similar to short term payday loans. They had drawn criticism from consumer advocates due to the high cost to borrowers.

First Bank of Delaware said the move would “have a material adverse impact” on the bank’s earnings, but didn’t specify a figure. No quarterly reports have been announced since the instant payday loan removal, so there's no way for the public to know the effects of that decision at this time.

Recently, an elderly woman in Acadiana, La., placed a call to her local Better Business Bureau office. Why?

Because she didn't understand why the money contained in her Social Security check was being deposited directly into the bank account of a local payday loan company.

Meanwhile, another older couple living in Crowley, La., came into the same office after realizing they put their house up as collateral in return for a payday loan they subsequently fell behind on.

“The vast majority of people do not ask the right questions. A lot of people don’t even understand the contract, but there is not much we can do about that. We feel powerless. I have heard some horribly sad stories, and I think in a lot of cases, the companies do prey on the low income, low educated and the desperate," said Sharane Gott, president of the Better Business Bureau of Acadiana. "They know they don’t have the capability to read the contract fully. That’s the calls we get — ‘help me understand’ — so we hold their hand and try to help them.”

Louisiana state law prohibits the use of one's home or direct-deposit Social Security checks as collateral with no faxing payday loans, but these people became entangled in multiple loans with payday loan companies and clearly did not read the fine print on the accompanying paperwork.

“They weren’t aware of the repercussions of the documents they were signing. The business knows what to do, what’s legal, what’s not, but it is the feeling of the bureau they do a real fast shuffle,” Gott said.

With seemingly innocuous names like Mr. Check, Money Mart and Cash Cow, the payday loan stores in Louisiana offer high-interest products that they say serve a need in the community, but that critics say should be outlawed, according to the Independent.

“Payday loan companies say their growth indicates there is a big demand for their services,” says Jordan Ash, director of financial issues for the national consumer group ACORN, “The same could be said for people buying crack cocaine. Lots of folks buy crack, but that doesn’t mean there’s a legitimate need for it.”

Dr. Marvin Copes is an Education/Community Service Volunteer for AARP Alabama in Maylene. He recently wrote about the instant payday loan world, how to avoid applying for these resources and where to turn if you needed them …

Let's start with ways to rid yourself of debt: Contact your creditors to see if they will give you more time to pay your bills. If they agree, you can pay these balances when funds are actually available. Maybe borrow from a friend or family member.

If a payday advance is unavoidable, however, be sure to shop around. Although payday loans may be the only option for certain borrowers with poor credit, you may be able to find a bank or credit union that will approve a small loan with a reasonable interest rate. Compare both the APR and the dollar amount of the finance charge.

More financial advice: Consider getting overdraft protection on your bank account. You will avoid returned check fees and have a cushion in financial emergencies. If you own a credit card, try taking a small cash advance out on it.

If you find you are just a little short of cash each month or can’t pay unexpected bills, take a hard look at your income and expenses. Is there any way that you can develop a modest savings plan? If you track where you spend your money, you may find ways to save. Are there some purchases you don’t have to make? Think about it.

With just $300 in a savings account, you may be able to handle a financial emergency without going to a payday loan company. If you can do this, you can avoid high payday loan fees AND earn interest on your money until you need it.

Finally, if you need help preparing a budget, you can get it from a nonprofit credit-counseling agency or cooperative extension agent in your area. The overall idea is to look around before just settling on a cheap payday loan - and then being smart about this decision once you do have to make it.

As previously reported, entering into the payday loan world has been a good business decision for EZCORP, Inc. This fact was emphasized today when results for its third fiscal quarter, which ended June 30, were announced.

For the period, EZCORP's net income increased 163% to $5,608,000 ($0.40 per share) compared to $2,129,000 ($0.16 per share) for the quarter ended June 30, 2005. Total revenues for the third fiscal quarter increased 31% to $73,786,000 while operating income improved 155% to $8,040,000.

Overall, the instant payday loan company has 288 EZMONEY locations and 82 EZPAWN locations across the country. It specializes in short-term, non-collateralized loans, often referred to as payday loans, or fee based credit services to customers seeking loans.
President and Chief Executive Officer, Joe Rotunda, stated:

"We continue to be pleased with our strong momentum and the continuation of our five-plus year trend of growing our earnings and profitably expanding our business. Our fiscal third quarter is the 16th consecutive quarter of year-over-year earnings growth. This quarter we increased earnings 163% over the prior year quarter.

We are especially pleased with the strong performance of our pawn operation as well as the continued strong performance of our signature [faxless payday loan] business."

No so fast!

That's the message Fair Finance Watch, a financial services watchdog, has given to Wachovia Corp. The issue at stake is the proposed $25.5 billion acquisition of Golden West Financial by the latter company.

In a 15-page challengefiled July 24 with the Federal Reserve Board in Washington, Fair Finance asks the Fed to hold public hearings on the merger's potential to raise prices ; along with what it says is Wachovia's continuing enabling of instant payday loan lenders and the disparities in Wachovia's 2005 mortgage data. The group requests that the Fed deny Wachovia's application to buy Golden West.

Reasons behind the objection: An analysis by Fair Finance Watch of Wachovia's 2005 mortgage data showed that African Americans and Latinos who borrowed from Wachovia and its affiliates were confined to higher-cost loans or denied loans far more frequently than white borrowers.

Moreover, the group isn't pleased Wachovia's continuing relationships with and financing of faxless payday loan lenders and pawnshops, despite bank policy statements to the contrary. A Wachovia spokeswoman would not comment specifically on any of the allegations in the Fair Finance Watch challenge.

The bank's prepared statement said:

"Wachovia has a long history of commitment to our community. We look forward to building on our legacy of community excellence and extending the reach of our community programs and products in Golden West Financial's markets."

But will this be possible if they continue to be in cahoots with pay day loan providers?

The debate over payday loans can go on and on. Some people defend these cash loans, while others wish to find alternatives for those in need of money. One fact must be agreed upon, however:

• Across the nation, people DO search for these resources

A recent study into the popular world of Google narrows down the areas most apt to search for instant payday loan help. Analyzing the "trends" section of this search engine reveals a lot. For example …

- Residents of Apex, North Carolina ran an online search for the term "payday loans" FAR more often than any other area of the country last month. This would be at odds with the fact that the state eliminated payday loans earlier this year.

- Coming in second, with fewer than one-quarter the searches of Apex, was Las Vegas. Hmmm … we wonder why. Could gamblers hoping to reverse their fortunes be applying for online payday loans?

- Rounding out the top five cities that most commonly looked up payday loans on the Web were: Kansas City, MO; Phoenix, AZ; and Norfolk, VA. What does this show? The payday loan online world isn't confined to just one region of the country.

As far as country demand and/or curiosity regarding payday loans goes, America reigns supreme. Last month, we were about twice as likely to use the Internet for these purposes, with Canada coming in second for payday loan searches.

This is not shocking, sadly. Americans are building up more consumer debt than ever and often require payday advances to help alleviate the problem.

John Gill Jr., the lender who has been under fire in multiple states for alleged payday loan violations, faces a felony trial today in Florida.

The 48-year-old from Phenix City, Ala., appears in Pensacola, Fla., court today at 9 a.m., where a state prosecutor will attempt to prove his guilt in unlawfully conducting a business enterprise. Gill pleaded not guilty to the familiar charges at his arraignment.

Predatory lending accusations have dogged Gill across several states, and for many years now. Jean Ann Fox, director of consumer protection for the Consumer Federation of America, said people charged with such crimes often attempt to disguise their illegal practices by concocting methods of making them appear legal by that state's standards.

For example, a business offering faxless payday loans might issue a $100 cash rebate to someone for a telephone card or Internet access — rather than stating outright that a payday advance loan is being issued — and then take a percentage of that person's paycheck every two weeks for the next year.

"State after state has challenged that," Fox said.

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As concerns over military payday loans spread across the ocean, the issue remains heated at home, as well. 

In Missouri, for instance, Senator Jim Talent is urging instant payday loan companies to stop taking advantage of military personnel and their families. Talent was recently in St. Robert, not far from Fort Leonard Wood, to outline a plan to stop outrageous interest rates for cashing personal checks before payday.

He says some payday loan companies charge up to 800 percent annual interest on loans, while targeting young military personnel in need of quick cash. The republican's solution?

Talent has proposed legislation that would put a 36 percent interest cap on fast payday loans to those in the military and their wives. The proposed law wouldn't help civilians, but would be a welcome step for critics that blame cash advance lenders for forcing those serving our country into debt.

With regular paychecks, little financial experience, and the responsibility of having to deploy at a moment’s notice around the world, members of the military are perfect prey for predatory lending institutions offering high-interest payday loans.

“Lenders know they’re going to get a paycheck out of someone in the military. Plus, service members travel a lot and are away from their support networks. Overseas, they might not know their options,” Kelley Finch, the Navy-Marine Corps Relief Society’s outgoing director at Yokosuka Naval Base, said.

Although agencies offering faxless payday loans aren’t springing up around military bases in Japan and South Korea like they are in the lower 48, U.S. service members needing quick cash or lower monthly credit debt payments still get caught in the downward spiral of debt. In Japan, armed forces members simply find them online.

The Navy-Marine Corps Relief Society (NMCRS) is tracking the problem in Yokosuka and have seen about 10 cases in the region this year.

“It seems to keep increasing,” said Chuky Spivey, the group’s incoming director.

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