Payday Loans in South Dakota

If your life has reached the stage where you want to take a trip to Mount Rushmore or the Black Hills just so you can be around something that has some connection to money, it may be time to take stock of your lifestyle. Whether you live in Pierre or Sioux Falls, South Dakota payday loans may be able to help.

Lending Limits Are Coming Into Play

As a result of the high interest rates that follow short-term loans, many people have found themselves in trouble and borrowing more money just to keep up with the compounding interest. This is leading more and more states toward the idea of enacting borrowing limits to reduce negative consequences. This means that the way you can use payday loans in your life might be more restricted in the near future. However, that does not prevent the judicious application of short-term credit from being something you can apply to your life in a positive fashion.

The reason why your South Dakota payday loan can be helpful, ironically, is the same that it can be harmful. Say you have declared bankruptcy, which will knock your credit score for a look – and not the fun kind – this makes it very difficult for you to get any kind of loan through a traditional lender, regardless of your current ability to repay it.

Payday lenders, on the other hand, do not look at your credit score at all. All you need to get approved most of the time is proof of employment and a checking account. It is because of this that the interest rates are so high – the lender assumes a greater degree of risk and therefore charges a concomitant price. People who use this service without taking into account their actual ability to repay, wind up paying it too.

Rebuilding Your Credit Score

However, if you follow certain steps such as never borrowing for a recurring expense – because you will keep having to borrow for it – and making sure to repay promptly, not only will you avoid making your current situation worse, but you can actually improve it. This is because your credit report will reflect a pattern of borrowing with prompt and full repayment. This will raise your credit score, and improve your ability to borrow from more traditional sources and lower interest rates. All of this, of course, is contingent upon intelligent money management, which is crucial to getting you back on your feet.

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Des Moines Passes Six-Month Ban On New Stores That Issue Payday Loans

Businesses that provide payday loans need to stay away from Des Moines, Iowa, at least for 180 days. The Des Moines City Council on May 13 voted to enact a 180-day ban on new payday loan and pawn shops in the city. This means that business owners who want to open these stores in the city won’t be able to for at least six months. Consider the ban just the latest attempt by municipal legislators to fight back against what they consider the unfair lending practices of payday lenders.

An Unpopular Industry

The providers of payday loans aren’t exactly the most popular people on Earth. A growing number of state and local governments are taking aim at the industry, passing or debating tighter regulations on the way these lenders do business. Legislators are most concerned about the high interest rates – many lenders charge annual percentage rates higher than 400 percent – that payday lenders tend to charge. Others say that the short-term loans prey on consumers who are financially desperate, and willing to overlook the high rates they’re being charged. In Des Moines, there was little debate over the new ban. City Council members voted 6-0 to have their attorney craft a six-month moratorium on payday lenders and pawn shops.

Taking Action

The city council members took action against the payday lending industry after learning that a pawn and loan chain was planning to open a shop in the city. When the council voted to draft the moratorium, community leaders in attendance at the meeting burst into applause, according to a story in the Des Moines Register. Before the vote, activists in the crowd told council members that payday lenders were not examples of economic development, but rather businesses that take money from area residents while providing little in return. Activists in the audience also called on the state of Iowa to pass tougher new regulations on the industry.

Looking For an Interest Rate Cap

High interest rates are the biggest concerns cited by opponents of payday loans. The Iowa state legislature has in the past attempted to pass legislation that would cap payday loan interest rates at 36 percent. That legislation, though, has so far failed to make it into law. It wouldn’t be surprising, though, if Iowa did eventually pass some cap. If it did, it would become the latest state that’s pushed through more restrictions on payday lenders. Payday loans are a financial necessity for many consumers. But it’s hard to argue that their terms aren’t often outrageous. The payday lending industry could do a lot for its public image if it policed itself more carefully.…