Friday, September 1, 2006

You hear debt-laden stories related to various kinds of instant payday loans all the time. Critics seem to have the loudest voice when it comes to these resources.

As The Daily Times reports, however, many individuals from Tennessee are grateful for the chance to acquire a few cash advances.

Across the Volunteer State, payday loan services are regulated. They cannot charge more than $17.65 for every $100 dollars borrowed. The maximum fee a business can charge is $30, regardless of the loan amount.

Satisfied payday advance customers: A 44-year-old Maryville woman says she has used payday advance loan companies for the past year and thinks they provide a valuable service.

"I had always heard bad things about these businesses,'' the woman said. "But if I bounce a check and get charged $28 by my bank and another $30 from the company I wrote the check out to - the $30 fee these places charge doesn't look so bad.''

It's a point not many consider. The lifelong Maryville resident said a recent divorce and an illness that forced her to miss work contributed to her need for quick access to cash. She has used fast payday loan services on Alcoa Highway, in downtown Maryville and in Lenoir City.

"I think these businesses have actually helped eliminate loan sharks and seedy businesses," she added.

The cash advance and check cashing services are out in the open, they're legitimate and they're regulated by the state.'

For years, legislators have taken steps to stop faxless payday loan and check advance services altogether in some areas because so many of them operate near military bases and low-income communities. However, providers have still been able to operate in those states by funding loans through banks chartered in other states.

Helping those in a bind through payday loans: Steve Shields owns Cash N-A Flash at 536 E. Broadway Ave. in Maryville that opened in 2000.

He said: "I've had customers stand in my office and cry while they were thanking me for helping them out … Some of these people are good, hardworking people who are just in a bad situation. They need money but don't have the credit to get a regular loan.''

Shields, who served as director of the Blount Memorial Hospital Foundation for 12 years before opening Cash N-A Flash, said the no credit check payday loan services he provides help people who are in a bind.

"Some of my customers come in once and I never see them again,'' Shields said. "There are others who come in over a few months until they get back on their feet - and then there are some who are regular customers.''

Much of the criticism directed at the payday loan and check advance industry stems from repeat users. They get stuck in a cycle of debt because fees make it difficult to stay current on payments.

Carolyn Daniel, a certified counselor at the newly opened Consumer Credit Counseling Service in Blount County, said her counseling service does not recommend payday loans or check advances to its clients.

"We tell people to pay off those loans as quickly as possible,'' Daniel said. "If they aren't already using them, we don't recommend that they start.''

This entry was posted on Friday, September 1st, 2006 at 5:21 am and is filed under Tennessee.