Should Waukesha Limit Payday Loan Stores?
Proposed ordinance change would keep short-term, high-interest lenders from clustering in areas throughout the city.
With concerns about high interest rates and neighborhood aesthetics, Waukesha could enact an ordinance that would prevent payday loan stores from clustering.
Alderwoman Joan Francoeur was recommending prohibiting payday lenders from locating within 3,000 feet of another payday lender and within 500 feet of any residential district. The Ordinance and License Committee on Monday gave unanimous conceptual approval for the city’s attorney’s office to draft an ordinance that would later come back to the committee and ultimately the Common Council for approval.
The issue first came up about a year ago when a payday loan store wished to locate into the City of Waukesha. There was little the Plan Commission or the Common Council could do from allowing it to locate in The Shoppes at Fox River because the city had not adopted any ordinances. State law prohibits payday loan stores from being within 1,500 feet of other stores.
“In essence the applicant was complying with state statutes and regulations,” Francoeur said.
The proposed city regulations, according to a document Francoeur with the assistance of city staff, would limit the city to approving between two and four additional payday loan stores. The density would be one store to every 5,000 to 6,000 residents, according to the document.
“I want to make it very clear that enacting this type of ordinance in the city is a benefit to the city and to the city’s residents,” Francoeur said. “The intent is not to prohibit these businesses from locating in our city, but rather to give us a basis to manage their locations.”
The city currently has 10 payday lenders in Waukesha. Proposed changes would mean seven of the payday lending stores would be non-compliant; however, those stores would be grandfathered into the ordinances.
“The fact that we already have 10 in the city, I think that is more than enough to serve the need,” said Alderman Paul Ybarra.
Payday loan stores receive high criticism for high interests rates on loans given to conceivably the most vulnerable borrowers. About 70 percent of payday loan borrowers use the loans to pay monthly bills, according to the Huffington Post.
The immediate access to cash is attractive to some borrowers strapped for money. But the average borrow spent $900 in fees, interest and principal for a $375 loan in 2011, according to the Huffington Post.
Some states have implemented legislation to limit the short-term loans. Changes in Colorado saved residents there $100 million in 2011 by extending the minimum term from two weeks to six months, according to the Associated Press.
A State of Wisconsin document warns borrowers that annual interest rates can reach 500 percent of the loan. Wisconsin has limits on the loans that include capping interest charges after a loan meets maturity.
MarkWauk
7:17 am on Tuesday, January 15, 2013
hoorah!!!
Jason J
7:43 am on Tuesday, January 15, 2013
Yes, along with the fly by night gold buyers
jodi
8:28 am on Tuesday, January 15, 2013
I don't think we should allow any of them!
Laura Strackbein
11:47 am on Tuesday, January 15, 2013
I agree!
the 'sha guy
8:56 am on Tuesday, January 15, 2013
Another instance of government trying to protect the people from their own stupidity.
To try and stop them from opening because they charge too much in interest and payments is not the job of government. Let the free market do it's job. If there are too many to serve the needs, some will close.
The same could be said about the number of supermarkets/grocery stores, car repair facilities and banks in Waukesha as well. It seems as thought they are also congested and too numerous in the city, yet I don't hear any council members saying we already have enough of them to serve the needs.
@-;-'---- Rose
9:02 am on Tuesday, January 15, 2013
OMG...I didn't realize how bad these places were. I know a couple of people who use them. I'm glad people like you are doing something about this. Also glad I learned my lesson on financial matters from a husband I once had...I have been debt free since I left him.
Ash
9:04 am on Tuesday, January 15, 2013
A few years ago, I went to Madison and was advocating for the payday loan stores to have a cap on interest rates. At that time, we were interviewing people about any experiences they had with payday lenders. I remember one interview where a family had borrowed money to pay the electric bill and ended up have a 1200% interest rate!!
the 'sha guy
9:17 am on Tuesday, January 15, 2013
@ Ash,
Was it their decision, or did someone force them to use the place?
Government can not be responsible for saving people form their own stupidity. There comes a time when people need to make responsible decisions on there own. I don't care for the stores myself, but let's stop trying to have government be the solution for every problem someone might have.
@-;-'---- Rose
9:56 am on Tuesday, January 15, 2013
Did you ever hear the expression "Desperate people do desperate things"? The comparisons you make with other businesses don't make an iota of sense. My ex had us so in debt that I was ready to take my life. I would have grasped at any straw.
the 'sha guy
12:04 pm on Tuesday, January 15, 2013
So you think government should take the responsibility away from individuals and stop you or your husband from making poor financial decisions?
These businesses are making very high risk loans to people who can't control their own finances. If you don't need to use them, go to a regular bank or borrow from a friend or relative. We don't need government (especially local) trying to manipulate commerce by banning a legitimate business.
Would you rather these individuals borrow from a payday store, or rather they go to "Lefty" on the the corner to get some cash? Remember, if you don't pay Lefty, he'll come over and bust your kneecap.
Randy1949
10:07 am on Monday, January 28, 2013
At one time there were laws that limited the amount of interest a lender could charge. Anything over that was 'usurious'. I'm not sure if they've been repealed or not.
Payday places take advantage of people with poor math understanding in order to leave them poorer than when they started out. And they make it sound like such an attractive deal. The other kind of thing you see this time of year is the 'immediate tax refund' people. Yes, you get it right away, but you get much less than if you had waited.
This is really a legal form of scamming.
@-;-'---- Rose
2:49 pm on Tuesday, January 15, 2013
I didn't make any poor financial decisions before or after that marriage but during I might have gone to that type of place had there been one. I had to feed my kids, the 3 I baby sat and his big German Shepherd that I was scared to death of....while he sat in a tavern and bought drinks for everyone. A band-aid solution would have looked good to me.
marie
4:30 pm on Tuesday, January 15, 2013
I was harassed by one of these similar places after they thought my phone number was someone else. many of these companies are based in other countries and can flounder the radar for harassment and 1200 percent interest. once you borrow from them u will never get your phone number or your amount borrowed paid off. Be Leary ...check out the Internet for complaints on these legal scam artist.
John Smith
4:54 pm on Tuesday, January 15, 2013
Absolutely! !!!!! Get rid of them all!!!!!
twister929
6:35 pm on Tuesday, January 15, 2013
Waukesha is not open for business I guess.
@-;-'---- Rose
10:32 pm on Tuesday, January 15, 2013
What a bunch of die hards you guys are. Like you really think a business is a business is a business! You know darn well we welcome business in Waukesha but a bunch of joints like that are entirely different. Why aren't their tactics considered usury?
the 'sha guy
6:35 am on Wednesday, January 16, 2013
Rose...
Then be smart and don't use them. You can't expect government to protect people from making poor decisions. It is called personal responsibility.
robert johnson
9:09 pm on Wednesday, January 16, 2013
the 'sha guy is right, but even more so, the government should focus on creating higher paying jobs, job training, financial educations, etc. I don' think it is a problem to limit the number of stores whether they be banks, pharmacies, etc. to create a more balanced neighborhood. But, the complaints against payday lenders are wrong. Why do people need payday lenders in the first place? sometimes they get into debt chasing the Joneses, sometimes it is unemployment, sometimes people dont try and save. If someone needs cash fast, would you loan them money with no guarantee of getting paid back? Why doesnt the government just give everyone who needs a short-term loan a cheap loan? Sure. Payday lenders take big risks lending to people who have bad credit and need cash. It is a free market, and so long as the rates are transparent, then it is a personal decision.
www.responsiblepaydaylending.com
@-;-'---- Rose
10:31 am on Thursday, January 17, 2013
I'm outta here!! None of you guys are listening to how smart women get in these situations and act stupid....desperately they look for any way to feed their kids [and animals their husbands bring home] . Don't lump me with those who need everything NOW or need to keep up with the Jones' Friends and relatives get fed up with a drunk. feel sorry for the wife and kids and finally agree with her that leaving is a good idea.
Maria Smith
5:00 am on Friday, January 18, 2013
If it was not for payday loans I would not get any finance I have bad credit due to losing my company in the recession. I would love to get a cheaper traditional bank loan but I don't have that option. More needs to be done by the Government to help people when they have run out of money as the banks and Government are to blame for this mess that they have put us in. I can recommend as that is where I am getting my payday loans from http://speedyloansearch.com/ at the moment and they do not require a credit check so I am able to get one.
@-;-'---- Rose
11:34 am on Friday, January 18, 2013
@Maria...This is what I TRIED to get across to @ 'sha guy...If the Payday loan stores were there when I was in dire straits, I would have put one child in the stroller, took the other by the hand, waited until the 3 that I babysat went home and walked to the nearest one. I HAD NO FOOD FOR MY KIDS...or his damn big dog for that matter.
@-;-'---- Rose
2:13 pm on Friday, January 18, 2013
I really should have added to my comment: When my mother in law called I told her their son was "off' again for 2 days in a row. His enabling parents shopped and brought over food. I estimated the cost of each item added it up and paid them as soon as I got my baby sitting money. To the guys:Judge not lest ye be judged.