Passed Military Loan Bill Does NOT Count for Payday Advances
By J.J. CameronPayday Loan Writer
As debate over military payday loan use has raged on in Congress, the House did sign off on legislation to protect U.S. military personnel from abusive sales of overpriced life insurance and investments - but the cash advance issue remained unresolved.
The House of Representatives voted 418-3 to approve a measure that had already been passed by the Senate. Work on the legislation began two years ago after the media reported that aggressive sales agents were marketing high-fee financial products to unsophisticated young recruits about to ship out to Iraq.
This, of course, isn't the main payday advance issue. That one revolves around high rates of interest.
Louisiana Republican Rep. Richard Baker, noting the risks that military men and women take every day, said that "risking their financial future should not be among them."
However, The Pentagon has been urging Congress to cap interest rates lenders charge on these cash loans to American troops, as part of a still-pending defense spending bill. That wasn't part of this bill.
The measure sent to President Bush on Thursday would ban sales to the military of contractual plans, a mutual fund investment product that has virtually disappeared from the civilian marketplace because of exorbitant fees baked into the payments. The measure also would require military personnel be told about life insurance that is available to them through the federal government.
In the past, some troops have been sold life insurance policies offering the same coverage as the government plan, but costing far more. The legislation would also establish a list of barred brokers and sales agents to be made available to military installation commanders.
Does this mean the issue of bad credit payday loans to the armed forces is off the table for good? We'll keep you posted.
