For a change, lawmakers are showing some love for installment loan companies with proposed legislation H810. The proposed H810 legislation would relax a restriction within the North Carolina Consumer Finance Act to be able to permit a charge of up to $100 extra in processing fees on installment loans of $2,000 or less. Lawmakers are also seeking to add a handling charge of $3 per month for every $100 borrowed.
Marines being cautious with fee increases on loans
Borrowers would be affected by the higher loan fees that "encourage usurious lending" and put borrowers into a debtors prison easily, according to Michael Archer. He is the Marine Corps Installations East director of Legal Assistance. He took the time to denounce payday lending while he was at it. This is in spite of the fact that North Carolina currently has a ban on the practice.
"We have a lot of businesses, particularly lenders, that target military installations, large places like Camp Lejeune and Fort Bragg," said Archer. "We have a very unsophisticated population as well. They have crosshairs on their backs and they are vulnerable."
This concern was pointed out by Archer even though the installations such as Camp Lejeune have very strict rules on loan companies. These are about how close the installment and military loan businesses can be to the military base at any time. Consumers will always discover a way if they need them though.
"It's very difficult, both procedurally and practically, to put a place off limits," Archer told the Daily News.
New topic of instruction inserted
Marines and families of the Marines will be able to go to some educational workshops if H810 is put into law. These will be started by Camp Lejeune financial counselor Lewis Summerville. All of the extra instruction would make it easier for military customers to make good decisions. They wouldn't get an installment loan without first knowing about them.
If educators like Summerville all start doing military lending education in the right way, then this would likely be the case. The "just say no" idea is all the North Carolina Marine families will be taught, the Jackson Daily News thinks.
"We can only educate and make sure they make the right choice in not taking that loan," said Summerville.
Most independent studies have shown that private loans do not trigger poverty. The loans really will contribute to financial well-being for many people. If Michael Archer and Lewis Summerville had taken the time to read existing research, perhaps they’d have valuable information to add to the installment and military loan dialogue.
Jacksonville Daily News
North Carolina Consumer Finance Act
North Carolina professionals support installment loans