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Disproportionate Numbers Of Payday Lenders In Bible Belt And Mormon West


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I have always had this theory that the way we read the Bible, the way we understand God and the human condition and relationship to God impacts the way we treat other human beings. Today I found this article - and once again - my theory has been affirmed. ....

 

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http://pubcit.typepad.com/clpblog/2008/02/...tudy-shows.html

 

by Christopher Peterson

 

A new study, conducted by Steven Graves and myself, finds a surprising relationship between populations of conservative Christian Americans and the proliferation of payday lenders. A draft of the study can be downloaded from SSRN, free of charge.

 

The natural hypothesis is to assume that given strenuous Biblical condemnation of usury there would be more aggressive regulation and less demand for payday loans in these states, but ironically, the numbers show the opposite is true.

 

The study is based on the largest and most comprehensive database of payday lender locations yet created. We developed an index that measures the density of payday lender locations based on the number of lenders within a geographic area, the number of payday lenders relative to population, and the number of payday lenders relative to bank branches. We also developed an index that measures the political power of conservative Christians within a state. This index has three components. First it is based on voting scores given to a state’s Congressional delegation by a panel of three leading Christian Faith based advocacy organizations including the Christian Coalition, the Family Research Council, and the Christian Action Network. Second, the Christian power index also included Congressional delegation scores compiled by Poole and Rosenthal, two widely respected political scientists that study these issues. And finally the index was also based on the percent of a state’s Evangelical or Mormon population. Our results are based on a simple correlation coefficient test comparing the payday lending density index to the Christian power index. Our hope was to create transparent results, that simply describe a commercial and spatial pattern of high cost lending that exists in our society.

 

One thing our data does not show is a causal relationship between faith and payday lending. For example, we believe there are many other variables that help explain why this pattern has emerged, in addition to faith. Nonetheless, our findings should serve as a wake up call to pastors, religious leaders, and people of faith that usurious lenders are thriving in their neighborhoods, communities, and states. Given the Bible’s injunction against usury, Christ’s example of expelling usurious money changers, and the ancient Christian tradition of sound financial stewardship, our study suggests that Christian Americans may want to pressure their political leaders to better effectuate Biblical values on consumer finance.

 

We believe it is sad that states with a pious and honorable religious heritage now disproportionately host predatory lenders.

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Just to be sure I get it right... what does "payday lending" mean exactly? :scratch:

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our study suggests that Christian Americans may want to pressure their political leaders to better effectuate Biblical values on consumer finance.

 

Umm shouldn't it be the churches responsibility to effectuate Biblical values on the members of their congregations that own these payday lending institutes? Why should government teach religion? Seems to me the church hasn't done what they are supposed to do and the government is doing exactly what they are supposed to do which is keep religion and government separate. Maybe the churches should speak to the members of the congregation that own these types of companies and teach them biblical values, after all these states are predominately Christian which could lead one to believe the owners are Christian as well.

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Just to be sure I get it right... what does "payday lending" mean exactly?
Hello Thurisaz: These places are sleeze shops that give out loans at huge interest rates. They cater to the poor and uneducated amongst us. They're called "payday" loans, because someone can go in before "payday" and get a "loan" to last them until payday. Trouble is the interest rate is enormous - and when "payday" comes the lender owes their entire paycheck and then some in interest. The interest keeps piling up and before the lender (often young, poor and uneducated) ends up so far in debt that getting out is impossible. Loaning money at these rates should be illegal - it is in some states - but not all.

 

our study suggests that Christian Americans may want to pressure their political leaders to better effectuate Biblical values on consumer finance.

 

Umm shouldn't it be the churches responsibility to effectuate Biblical values on the members of their congregations that own these payday lending institutes? Why should government teach religion? Seems to me the church hasn't done what they are supposed to do and the government is doing exactly what they are supposed to do which is keep religion and government separate. Maybe the churches should speak to the members of the congregation that own these types of companies and teach them biblical values, after all these states are predominately Christian which could lead one to believe the owners are Christian as well.

We agree ... Unknowing....

 

I didn't say I agreed with the article's author. But, it doesn't surprise me that these sleeze shops are more dominate in the southern Bible belt - literalist states. After all they believe in a God who needed a blood payback for the "sins of humanity". Why should anyone be surprised when that authoritarian, vengeful understanding of God - as well as an understanding of humanity as ultimately sinful in nature - plays out in culture this way?

 

If that's the way you understand God and the human relationship to God, then it will play out in culture. If a vengeful God demands a blood toll for "the sins of humanity" - why should it be wrong for a payday lender to demand blood in interest out of the poorest in our land? Literalist Biblical doctrine is survival of the fittest at its worst (because it uses the Bible to defend its actions).

 

It's no different from the Southern Bible Belt using the Bible to defend slavery and a host of other inhumane actions over the years. Nor is it any different than the Bible Belt states not educating their young about contraception and other areas of human sexuality and then wondering why their rates of teenage pregnancy are so high. There is a link between one's theology and one's actions in the world. This is just one more story that shows that link.

 

And yes - you are right - the churches should be taking the lead in educating their congregations about these places. But, it wouldn't hurt them to put public pressure on their state governments to make them illegal. The "payday loan" businesses are predatory business at best. They do nothing but cause harm to others as a way of earning great profit for themselves.

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Oh the shark has

Pretty teeth, dear,

And he keeps them

Pearly white...

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Just to be sure I get it right... what does "payday lending" mean exactly?
Hello Thurisaz: These places are sleeze shops that give out loans at huge interest rates. They cater to the poor and uneducated amongst us. They're called "payday" loans, because someone can go in before "payday" and get a "loan" to last them until payday. Trouble is the interest rate is enormous - and when "payday" comes the lender owes their entire paycheck and then some in interest. The interest keeps piling up and before the lender (often young, poor and uneducated) ends up so far in debt that getting out is impossible. Loaning money at these rates should be illegal - it is in some states - but not all.

 

Ah I see. Thanks for the info :)

 

That said, I'd say that this is another piece of damning evidence supporting the saying "Hypocrisy, thy name is morontheism"... :fdevil:

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Exactly, which is one reason I take exception to the statement in the article to "better effectuate Biblical values on consumer finance". Payday lending institutes should be at the very least be regulated but honestly here in the south it shouldn't be based upon biblical values. The examples you gave, teenage birth rate and slavery are prime examples of why not. Unfortunately our general assembly members sit in the same pews with those owners of the lending institutions and hear the same "biblical" message week after week.

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Exactly, which is one reason I take exception to the statement in the article to "better effectuate Biblical values on consumer finance". Payday lending institutes should be at the very least be regulated but honestly here in the south it shouldn't be based upon biblical values. The examples you gave, teenage birth rate and slavery are prime examples of why not. Unfortunately our general assembly members sit in the same pews with those owners of the lending institutions and hear the same "biblical" message week after week.
Unknowing - I didn't post this because I think the southern churches should impose their "biblical values" on anyone. In fact quite the opposite. I do not agree with the authors conclusions. I believe that there are such disproportionate numbers of payday lenders in the Bible belt BECAUSE of their understanding of scripture and God. You and are in agreement here.

 

If the leaders of southern churches really cared about poverty issues, they'd be up in arms. They're not and they're not in large part because their understanding of God is basically survival of the fittest. They believe in a vengeful, hateful, mean-spirited - man/god sitting on a throne somewhere. They believe the only way to "salvation" is that individuals have to grovel at his fit (survival of the fittest - you're salvation is your own problem). That's why they can use the Bible to justify all kinds of in-humane activities, like slavery, and bigotry, and not giving young people the education they need, and payday lending.

 

As I said in the OP - this whole payday lending thing - is just one more affirmation for me that the way people think about God, read the Bible, and think about the human condition and relationship to God impacts the way they treat other humans.

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I can only speak from experience because I work in such a place that does payday lending. (An interesting point is that the US government has usury laws concerning people in the military. We are not allowed to offer any payday lending products to active or retired military.) The company sent us, the employees, information, about the officers of the company I work for. The people who run the company I work for, all put the Bible as being their favorite book. Though, they have no qualms about charging a whopping 304% interest a year. In my opinion, the least they could do is offer their customers better money managements skills, through an online course on their website and direct them to such programs, but they do not. I would have to say that 99 percent (a conservative figure) of my customers, who are using the payday lending services, are Bible believing Christians. At least at the company that I work for, it is Christians preying on other Christians.

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...304% interest a year.

 

And they haven't been lynched yet?! :blink::banghead:

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...304% interest a year.

 

And they haven't been lynched yet?! :blink::banghead:

 

 

Nope probably because the owners in most cases are affluent, white, Christian males. In our state whenever a payday lending bill comes before the general assembly the payday lending groups band together. They have a very large contingent of lobbyists and are very effective in getting the bills killed. Usually the consumer is the one to blame, they aren't using the programs as they were intended. For example the consumer gets a loan at one company and then goes to different company and gets another loan. When it comes time to pay they must go to another company and get another loan in order to pay off the first one and the cycle continues. The process reminds me of check kiting schemes but it isn't the institution that is harmed it is the consumer. There is no control on the number of loans of this type a person can have nor the amount of interest that can be charged.

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...304% interest a year.

 

And they haven't been lynched yet?! :blink::banghead:

 

Hello Thurisaz - that's just the tip of the iceberg. I did some research yesterday. Facts follow:

  • Out of the 50 USA States - only 11 make these loans illegal
  • Annual APR interest for 14 Day/$100 loan ranges (by law in the state) from 390% to unlimited
  • Average Annual APR interest for a 14 day/$100 loan is 421% - one state was at 1980% and 7 states had no limits what-so-ever.

 

Unknowing is right - any legislation that comes up to protect the consumer gets shot down because the payday lending industry has lots of money to hand out to politicians and lobbyists. It's quite sick.

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Unknowing is right - any legislation that comes up to protect the consumer gets shot down because the payday lending industry has lots of money to hand out to politicians and lobbyists. It's quite sick.

 

Thanks for posting this. I just could not understand why these places are not illegal. There is one on every major intersection where I live. They just prey on the poor. It is indeed sickening.

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Thanks for posting this. I just could not understand why these places are not illegal. There is one on every major intersection where I live. They just prey on the poor. It is indeed sickening.
Yeah.... I became aware of them several years ago - in an odd sort of way. I build databases for a living and I received a phone call from a gentleman saying he needed a new database built. We sat down together to discuss the project. During that discussion he told me he was in the "financial services" industry. I didn't really dig into his description of his business as much as I did the details of what he needed to track in the database.

 

After he accepted my proposal and I actually got a look at real data - I was dumbfounded by what I saw. I mean - we were sitting in his office and he was showing me this spreadsheet of data - like it was no big deal. And I could tell from the data that he was making big time money and the rates he was charging were horrific. I asked him more detailed questions about his business (thinking I'd gotten involved in something illegal) and he told me that he was the owner of a well-known payday chain in the area. (He used a different business name when he came to me). At any rate - I told him that it didn't matter to me if it was legal (or not) that I couldn't do the work and I left. I didn't want my business to be associated with that kind of crap.

 

I've learned to ask more detailed questions about a business during the interview process - I don't ever want to be in that position again.

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wow OM I had no idea about this type of lending being so horrible. Never been to one nor read about them till this post.

 

thanks for sharing, wish there was something that could be done about it

 

sojourner

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But don't forget, people, the Lard helps those who help themselves...

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But don't forget, people, the Lard helps those who help themselves...

 

Ahh ... Grandpa Harley - don't you know Christians take care of each other....

 

Christian Faith Financial

https://www.christianfaithfinancial.com/lea...sp?p=howitworks

 

"we help you the Christian way"

 

"Helping families with Christian financial assistance"

 

"Do not overcome evil with evil, but overcome evil with good"

:ugh:

 

Look at it this way - these folks are helping to create more Ex-Cs

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This has "something" to do with this thread...

 

Has anybody ever received a card in the mail saying you owe X amounts of dollars to a church as part of your tithing obligation? For example, you make $600 per week and you owe the church $60 per week for the tithe, but you have other obligations to pay instead so you send maybe $20 per week. Who has received these notices and how does it make you feel?

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This has "something" to do with this thread...

 

Has anybody ever received a card in the mail saying you owe X amounts of dollars to a church as part of your tithing obligation? For example, you make $600 per week and you owe the church $60 per week for the tithe, but you have other obligations to pay instead so you send maybe $20 per week. Who has received these notices and how does it make you feel?

 

Yeah I have gotten those :lmao:

 

Mostly they just make me laugh, the whole effort is just ridiculous on their part. I wonder if they ever have gotten anything back that way? If they actually do I would be angry rather than amused.

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Yeah I have gotten those :lmao:

 

Mostly they just make me laugh, the whole effort is just ridiculous on their part. I wonder if they ever have gotten anything back that way? If they actually do I would be angry rather than amused.

 

Yeah, it's the same ball of wax but just in a different consistency.

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Not only do they have the outrageous interest rate, but they also have transaction fees. They make it easier to refinance, and thus up the amount of the loan, rather than pay it off at the end of two weeks. They roll over the amount of the loan AND the interest owed, tacking on even more interest. So, the amount of interest charged to the original loan is a lot higher. Because of this often people get so far in debt through payday loans they cannot possibly repay them, other than only pay on the interest which is what the company wants and how it makes the most money. The company makes more money on the payment on the interest, not paying the loan off. It is a vicious cycle. They require a blank check for every transaction and will cash the check for the entire amount owed if the interest isn't paid within 24 hours of the due date and a bounced check gives them legal recourse to take someone to court and garnish their wages. It's highway robbery and they do it legally.

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