Pay day loans target customers without any credit or credit that is low. These high-interest loans vow fast money before the paycheck that is next in, but oftentimes they create dangerous cycles of the latest loans to repay the old people, draining funds and pressing borrowers ever deeper into poverty.
In 2018, the Federal Trade Commission sued major payday lender AMG solutions for misleading lending that involved illegal withdrawals and charged concealed fees. The $505 million in restitution AMG decided to may be the biggest refund the FTC has administered to date, addressing a projected 1.1 million borrowers.
Today, customers involve some protection from this kind of predatory lending through the Payday, car Title, and Certain High-Cost Installment Loans guideline through the Consumer Financial Protection Bureau.