Short Term Lending

Posted on: November 15, 2017 CashMax February 6, 2018

THE ROLE OF SHORT-TERM LENDING COMPANIES

You may have seen in the news that the Consumer Financial Protection Bureau (CFPB) has considered new rules that would impact the way short-term lending companies help people make ends meet in trying financial times.

You can read the full proposal here, but here are the key changes that would impact you:

  • You can have an active loan for 90 days in one calendar year.
  • After you pay off a loan, you have to wait 60 days to open a new one.

These rules would apply not only to payday loans, but also to car title loans and other installment loans. While we understand and appreciate that the intent behind the proposal is to protect consumers, our concern is that these changes would actually revoke your financial freedom.

Let’s take a look at how short-term loans are actually used. Did you know that:

  • More than 12 million Americans rely on short-term loans each year?
  • The average borrower takes out 8 loans per year, and loans are open, on average, for just 18 days?
  • People use short-term loans to pay for unexpected expenses as well as recurring, ordinary living expenses?

In other words, even if you are among the millions of people who responsibly use short-term loans, you may not be able to take out a new loan when you need it! Can’t pay rent this month? Need some cash for those unexpected auto repairs? Accidentally overdraw your checking account? If changes like those in the CFPB proposal become reality, short terms loans from companies like CashMax will become increasingly difficult to get for these types of events.

PERCEPTION IS NOT REALITY

Look, we get it. Our industry has a perception problem. We’ve been called everything from a scam to a debt trap to predatory lenders. But perception isn’t always reality. And when it comes to our industry, the reality is that cash advances and auto title loans help millions of people make ends meet every year. That’s a role we’re happy to play.

If you are currently a CashMax customer (or have ever used a short-term lending company), we thank you for the support. If you’re considering short-term lending company, feel free to call the CashMax location nearest you to learn more about how we can help.

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CashMax is a Credit Services Organization (CSO) operating pursuant to the Ohio Credit Services Organization Act, Ohio Revised Code §§ 4712.01 et seq. CSO is not a lender and does not make loans of any type. All loans will be made by a third-party lender. Submission of information in no way guarantees that you will be approved for a loan from the third-party lender.

* Not all applicants will qualify for the maximum loan amounts available. CSO will attempt to arrange a loan for you from a third-party lender, but CSO does not promise that you will receive a loan. Credit decisions and the amount of these loans will be made by the third-party lender based on the information you provide in your application. The finalization and funding of all loans are subject to your providing to CSO and the third-party lender requested documentation and information to confirm the submitted data is complete and accurate. Your failure to provide requested documentation and information will delay the processing of and may terminate your application and/or transaction.

** CashMax uses non-traditional credit bureaus. If you complete and submit an application for credit services, you acknowledge that you authorize us to verify information through certain national databases including – but not limited to – Clarity, DataX and Factor Trust. We may review your credit attributes in order to determine your eligibility and ability to repay. Based on the findings from the original credit inquiry, these non-traditional data bureaus may seek additional information from the traditional credit bureaus. When this occurs, it is possible your credit report will show an official credit inquiry.

NOTICE: An advance of money obtained through a Cash Advance or Title loan is not intended to meet long-term financial needs. A Cash Advance or Title loan should only be used to meet intermediate or short-term cash needs. Refinancing the loan rather than paying the debt in full when due will require the payment of additional charges.