Colorado Limits Payday Loan Rates

Sometimes, regulators and politicians just can’t seem to keep their hands off an industry. The payday loan industry, for example, is a favorite target of many folks. Just about every state has passed some form of legislation to regulate the payday loan businesses, although the amount of regulation can vary greatly from one state to the next.

Arizona’s Attorney General, for example, has gone after payday lenders on many occasions. There are other states, such as Illinois, that have passed a number of different measures aimed at shutting down payday lenders. Another state to recently pass payday loan restrictions was the state of Wisconsin. It seems like everywhere you turn, there are state politicians and legislators that want to put the screws to the payday loan industry.

There is even a federal law that dictates how payday lenders can loan to military personnel. The federal legislation aims to prevent abuse of military families by limiting the interest rate that the lenders can charge on a payday loan to those folks.

The latest state to take a stab at the often-controversial payday loan industry is Colorado. The Colorado House recently passed a measure onto that state’s Senate for consideration.

Currently, the maximum annual percentage rate that a lender of any type can charge in that state is 300 percent. The new legislation would dramatically reduce that rate down to an annual rate of just 45 percent.

According to the Attorney General in the state of Colorado, the average borrower of a payday loan renews and refinances that loan a total of five times before they pay off the original amount. That works out to be a hefty sum. In the year 2009, the average payday loan borrower in Colorado borrowed about $336.97, and paid a whopping $475.73 in interest on that loan.

Needless to say, those in the payday loan industry are carefully watching what’s happening in Colorado to see whether or not the legislation makes it any further.

Is Overdraft Protection the Lesser of Two Evils?

One of the ways to avoid taking out a payday loan that some opponents cite is the idea of using overdraft protection. Overdraft protection is a way for your bank to pay a check that doesn’t actually have enough money in your account to cover. It’s important to understand exactly how overdraft protection works if you want to decide whether it’s a viable alternative to a payday loan.

Overview of Overdraft Protection

A check, or a “draft” to your checking account usually must be paid from funds within your account. If you have $50 in the bank and you write a check for $100, that check will usually bounce.

With overdraft protection, the bank doesn’t bounce your check, however. They pay the difference – in this case, a difference of $50 – and then charge it to your account. You still have to pay the extra $50, of course, as well as a fee.

There are usually limits as to how much the bank will cover in overdraft protection. Usually it’s a matter of a few hundred dollars. Chances are pretty good, too, if you use your overdraft protection often enough, they may stop letting you use it.

How Much are Overdraft Fees?

That’s the real question. The fees involved in overdrafting a check are less than the combined fees you’d pay to the merchant and the bank together if you bounced a check. However, there’s still a fee.

Typically, the fee for an overdraft will be between $25 and $40, depending on your bank and where you live. Some states set limits on the amount that a bank can charge.

Is it worth it?

When compared to a payday loan, overdraft protection can make sense. If you borrow $400 with a $50 fee from the payday lender, you can just as easily write a check for $400 over your bank account and only pay a $25 fee. The key is making sure there is just a single overdraft. If you wind up with multiple charges, you’re talking about a significantly different situation.

It feels so liberating to type that

I got involved in the “orange fog” (aka Arbonne) 18 months ago. A very trusted friend introduced me to the opportunity. At the time, my husband and I were at a very rough place, financially. I had been a stay-at-home mom for three years and had just had our second child. I went to an opportunity meeting and heard one of the top NVPs speak and I was in hook, line, and sinker. I actually promoted to management level very quickly (went into qualification for Area Manager my 1st month in the business). I was so excited, I truly believed that I was helping other people be able to work from home and have a potentially great income. As I ran out of my warm market after several months, it became harder and harder to “sell the dream”. I started dreading sharing the opportunity with people, scheduling parties and drop-offs, etc. I hated the feeling that everyone was a prospect and if I wasn’t sharing the Arbonne story with someone everyday, and for sure everyone that I came into contact with, then I wasn’t a good person. The rhetoric and catch-phrases started to sound so empty to me. “Don’t quit until payday”, “Fake it ’til you make it.”, “Is your fear bigger than your why?”. I slowly began to feel like if I wasn’t rah-rah-rah about Arbonne, pounding the pavement to sign up new people, launching new business builders, etc, then I wasn’t much of a person. I mean, how could I put my own fear and doubts in front of the financial security of my children? What kind of mother did that make me?
Looking back, I can see that I was desperate and depressed, two emotions so totally foreign to my personality that I was drowning in self-doubt and self-hatered.

And then it hit me. I don’t have to do this. I don’t have to be gone from home for endless opportunity meetings and parties and showcases. I don’t have to travel all over the country for one more “life-changing” training. I don’t have to become that person who everyone avoids because I’m always trying to promote my business and my products. And so, I WALKED AWAY!!!! Wahoo!! No more Sunday night conference calls. No more opening my calendar and feeling guilty and ashamed and worthless that it’s not filled with 6-10 presentations each and every month. No more wondering who I can ask to host another party for me. No more, no more, no more.

I know what my life’s purpose is. And it’s not to drive a white Mercedes paid for by Re9 sets. It’s to be a happy and fulfilled person, who feels value for who I am, not what my title or my paycheck says. (BTW-I was an Area Manager, starting in June of ’06 and made a whopping total of $72 for the year. That’s subtracting out all of my expenses-travel, and products ordered, and business aides, and fees for craft fairs, etc., etc., etc.)

For so long I’ve felt like a failure because I couldn’t motivate myself to take this business to the top. The irony is that I’ve never felt more successful than when I walked away from the Arbonne fog and into the light.

“What’s your why?” It’s any number of things, none of which will ever be fulfilled by handing out one more damn Re9 sample.

Very well stated Hal…btw everyone, I got that annoying email tag to go away

I will say for me, I have always been headstrong, independent and for a young woman I do quite well for myself. I was preyed upon at work. I know you guys don’t know me very well but in retrospect I see how they did it. They got to know me first, what I liked, what drove me.

My parents own a small vitamin company. My dad used to always say there was nothing like working for yourself because you had no one to answer to. You do what you want when you want…in a responsible way of course. My parents don’t live a completely glamorous life but they are comfortable and happy. Being out in the workforce I would love to be like that go when I want etc… My passion in life is singing and theater. If I could do it and make a living at it I would.

These are little tidbits that my “upline” found out about me. My dad was also a minister and I have pretty deep Christian roots, want to do missionary work etc…1 more thing to prey on. When I was initially approached I was VERY skeptical. So much to where I went to 5 open meetings before I decided to join. What hooked me was what if I could do theater full time and what if I could do those missionary trips and help out others? What if I didn’t have to work a “job” and I could live those dreams….silly, not for me, that’s how deep those passions lie. Hey from what they said I could own my own theater company some day and travel the world to give back to others. So that is how they hooked me. I was sucked in and dreams dangled in front of me like carrots to a rabbit. Every time I would back away they would tell me of all the things I could do if I just pushed a little harder I could get my dreams to come true. How I would be blessed by blessing others etc

I think I was borderline brainwashed. They said listen to the cd’s which I did, but read the books….now I couldn’t get into it. They preached to sell out to the business for just 2-5 years and your dreams could come true. I thought about that. Sure it wouldn’t affect my ability to do mission work but how would 2-5 years of not practicing and working hard as a singer and performer affect me? I have worked for 17 years to achieve the level of quality in my work if I miss a week of practice let alone two it can set me back for months (if you aren’t a singer you may not understand that) So basically I would sell out and in 2-5 years become a mediocre singer/performer? Yes I could do missionary work but for all the functions I would have to attend my work would have to be tailored around that. To me I would be no better off than if I just kept doing the singing thing part time, work full time and take maybe one missionary trip every few years. If it ain’t broke don’t
fix it you know.

Have I been scarred by my experience oh yes but more so in an “I finally saw the light” sort of way. There were times that I felt like a failure because I didn’t sell out to the business. I wanted so bad to give back to others and I wasn’t getting any real results so I felt I would never be able to help. I still have to work with these people (upline) too so I walk lightly for my own personal reasons. Was I in a self loathing state of mind or suffering from a low self esteem? Hardly. I have been through the fire in my life and I am a survivor no matter what. I know what I am worth and what I am capable of.

I just think Steve needs to realize that what gets most people is the “dream” of what could be. Sure there are those out there that want to “belong” to some secret society (except MLM’s aren’t that), but I think most people on this board had a “dream” (and you still may do it just doesn’t involve a MLM) and that’s how they bought it hook line and sinker. Think about it, the main targets now are young couples and sometimes those with small children. They tell you that your wife can be free to care for your kids. Most parents want what’s best for their children so that’s the “carrot” they get. For younger people, they’ll tell you this will help you retire your parents and take care of them, set a foundation for a family etc. I think most people that get involved just want more for their family in one way or the other, for most it’s not a self esteem problem.

Fantastic – congratulations, and all power to you for your awareness and courage!

My partner and I send you warm smiles and respect, a great story to share with other people. You know, your post highlights the dirty, shameful secret of why MLM works. It’s the same as any addiction:

1) It offers a fix for your lack of self-esteem and the pain of your depression, fear, self-

2) It amplifies that self-hatred and depression and it adds SHAME into the equation

3) It exploits and abuses you while making you feel responsible for it’s failure

What I hate about MLM is that the people who set up a business to be an MLM business for sure understand this before they get going. Let’s not mince words. They know. They know the kind of depressed, ‘quick-fix’ people who will throw their resources into it in the same way that daytime TV loan advertisers know the desperate people they too can exploit. It is never accidental. These people know where the stress and the damaged relationships will impact – and they don’t give a damn. They know how costly it will be to the vast majority of ‘business associates’ so that they, the founders, will get rich. And we live in a culture that gives them permission to do this.

Well done for putting your story here, you write with real power. I hope that your action is a step towards healing the lack of self-esteem that put you in a position to be exploited by this ‘system’ in the first place.

I am rather impressed by your willingness to speak your mind –

in an inexplicably testy environment – I have been in this forum a few months, and haven’t seen much of that 😉 However, I would like to disagree with you and maybe this will lead to a better debate 🙂 (hoping).

1. Given the 10s of thousands of people that go in and out of marketing every year, its impossible to put them all in the same category – especially with respect to personality traits.
2. You ARE speaking to people(mostly – I have not been in an marketing) that HAVE changed. So I don’t think anybody here will tell you that the marketings are the only ones that need to change.
3. You do not seem to take into account the fact that most people are not recruited into marketings by the marketing, but by friends, family and other trusted entities – To ignore the power of persuasion of people close to you is IMHO oversimplifying the scenario. So, its simply not true that people get into marketing just because they have some dark skeletons in their cupboard or because they need to fundamentally change something. If anything, I think a lot of people that get into marketing do so because they readily trust the judgement of people close to them – and this is what the marketing companies exploit.
4. I will grant you that most people in marketings (that I have come across – pl. note disclaimer) seem to readily participate in disingenuous schemes like “fake it till you make it”. So in that sense I concede your point.
5. Finally, people come to marketing from every conceivable field – including people with very high self-esteem, people who are already extremely wealthy, people who are already successful in other fields, home builders hoping to do some good and earn some cash while at home, and also others who are just hoping to get rich using this scheme. While nobody here will argue with you that marketings are evil, it is impossible to characterize all the people who get in as any one thing – unless its the hope that they can make it big with marketing. In fact, its not even true that marketings destroy your self-esteem in every case – I find thats not true either.

good luck!

Just a thanks to PW and Hal for doing such a fantastic job of

representing everything I’ve been feeling in this thread. Steve…you do us an injustice by painting us all with the same “damaged” brush. Please do stay and learn more about each of us and you’ll see that there is no “one size fits all” for MLM survivors. Or rather, there isn’t any one dysfunctional thing we all have in common that made us susceptible to MLMs.

Even though I’ve been online for 15 years, 10 years ago when I first fell, there just wasn’t the supportive community and information available today.
And I think that’s what I was saying in my very first response here, that if MLMs were required to hand over the truth along with their hype, there’d be a lot less folks getting involved.

This all makes me think of my Management days before having kids. Prior to running the daily operations of multi million dollar companies AND staffing the places, I used to think I was a good judge of character. Okay, so I’m still a good judge of character BUT I learned from the years of hiring that if someone really wants to get one over on you, THEY CAN AND WILL. Some people are just darn good actors in their pursuit of their agenda, whatever that may be.

If anything, I think maybe one common thread I might see in MLM Survivors is the ability to trust. They trust others to not lie their pants off (though even with this said, I realize that many MLMers are not outwardly lying but being mislead/lied to). Just a thought.

I’m sure that like PW, a lot of the members here are active in their anti MLM practices. I’m amazed at how many people I know are doing it and they aren’t even aware. My next door neighbors for example, I’ve had many talks with them about how much they hate MLMs and yet I’ve later discovered they do both Stampin’ Up and Prepaid Legal. Even if only buying product (as was the case with PPL). My personal trainer does a nutrition line. Other neighbors do a variety of home party crap. All of them KNOW my stand on MLMs and will only reluctantly talk to me about them because while I won’t preach to those who don’t want to hear, I also won’t listen and certainly won’t attend any functions.

Anyhow….that’s my story and I’m sticking to it. 🙂

The editor approached me as the issue with the MLM article was being sent to subscribers

It was the March, 2007 issue, and the article itself had to do with Tahitian Noni. The author was being prospected into it and related his experiences with the meetings and the juice.
he also wrote about how little money he made and how bad the stuff tasted – a very personal perspective on one company and its narrow line of products.

The editor requested that I, as the owner of this group, offer something in response to the critical and mostly-well-written article that appeared. I agreed, and my response appeared in the July issue in the Letters section.

I didn’t mention it here before because I could not get permission to link to it or quote it. It seemed…I don’t know…strange for me to promote their magazine without being able to reference it. I was also uncomfortable with asking everyone to purchase TWO issues of Playboy magazine – one in order to read this person’s article and the other to see my brief response to it. I didn’t see anything new or Earth-shattering in it, and Playboy’s not the cheapest magazine (or the most comfortable for everyone to be seen reading).

I doubt too many people saw my little note, but I did get a couple of responses to it in my email – mostly calling me a loser and telling me to learn something about it before writing about it. 🙂

It’s nothing y’all haven’t seen here, and elsewhere, many times before.

But I wasn’t going to say “no” to the opportunity to speak out when it was offered to me.

There are two good points!

Yes, I overlooked the issue of ignorance. Just as importantly, you point out that we can’t know everything about everything. I didn’t join when my gf took me to the open meeting because, in spite of all the temptation and presentation and everything that went with it, before I went, I spent some time with Google and knew what to expect and knew that even if it wasn’t a fraud, there was no reason to sacrifice a business I had built on my own that was paying the bills, and would be able to do much better, for something that might or might not work for me. Thanks to Google, I did not go into that meeting ignorant!

It’s also important to remember that none of us can know everything about everything. Many of us in this group were in an MLM before search engines. It’s hard keep a perspective on just how much life has changed in the past 10-12 years. In 1995 most people didn’t have the Internet or had even heard of it. Now we count on it as part of our lives and many of us, if we have questions of anything, we go to a search engine and check it out.

Even with that in mind, the open meetings of QS are pretty good at playing emotional tricks on people. They don’t want to tell you what the meeting is about until you’re there and they do a good song-and-dance about how you’ll find a lot of people saying bad things because they’re jealous.

Even with all that, if you search for the right terms for an MLM, many of them have gone out of their way to front load search engine results so you’re likely to get results they want you to see instead of honest opinions.

I will only differ with you on one point: ignorance

The MLM leaders RELY UPON ignorance in order for the rest of their pitch to work. If everyone was fully aware (NOT ignorant) of MLM and the harm it has caused, the entire industry would probably collapse.

We cannot know everything about everything, and it’s those gaps in an individual’s knowledge that allows such an elaborate scam to work.
That’s why the only way the industry will be reformed or outlawed is for government to step in and put a stop to the abuses. That’s why those of us who participate in these forums need to take any opportunity we can to let our neighbors, friends, elected officials and anyone else with whom we come into contact hear about it.

I’ve sent letters to my attorney general. I’ve submitted letters to lawyers. I’ve contributed to Eric Scheibeler’s legal fund. My wife and I appeared on Dateline NBC to speak out about MLM. I was approached by an editor at Playboy Magazine (Owning this board has its privileges – wink, wink.)about writing a response to an article they published a few months ago about MLM. I’m sure other opportunities will appear for me in the future.

But I’m only one person. And one of my primary goals for this blog is to make sure that everyone who visits here understands WHY we are here and what we are fighting. That way, more people will have to tools they need (forgive the pun) to assist in the greater goal of bringing an end to abusive MLMs.

Steve, as a new member of this forum-blog, I don’t expect you to understand all of this yet. But I do expect you to refrain from making blanket judgments about people you don’t know. I can assure you that you have NO IDEA about who most of the people here are and what they have accomplished outside of MLM.

I’d call that a form of ignorance. And I don’t blame you or berate you for it. Just keep an open mind. I’m sure your presence here will be valuable for you, and for us.

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