What is it with these "checks cashed" places?

[sablebaby]

We have so many of them in PHX because of the illegal immigrants. They can't cash checks, so they need a place to do so.

[seashelly]

Originally Posted by sablebaby

We have so many of them in PHX because of the illegal immigrants. They can't cash checks, so they need a place to do so.

(That's what I'm thinking too, Sablebaby).

[neophyteblogger]

Such payday loans/cash advance businesses are proliferating faster than rabbits in summer; the internet has been a boon to them. they charge unbelievably high interest and are structured so as to enmesh poor blue collar workers in a never-ending whirlpool of loans and debt.

Go to these guys only if you are really in dire straits and the whole world has turned its back on you, only if you don't get money from anywhere should you go to cash advance lenders and that too after doing your research.

This site was useful when I needed information on the subject.

[Dedalus]

...are a national scandal. Not all states have them, some states have laws prohibiting them.

I'm generally a pretty "laisse faire" guy, but these outfits snooker people in...the previous poster who called them "legal loan sharks" was right on.

[John23]

These places are sad. It's sad they're even legal...what else are they besides legalized loan sharking?

Payday loan - Wikipedia, the free encyclopedia

390-900% interest?!?

Could Tony Soprano even charge that much?

It's basically like Tony Soprano setting up shop, but they aren't guys with baseball bats, just guys in suits that tilt everything in their favor.

I'm pretty laisse faire too, but these guys are over the top.

[Hatless Wonder]

"Payday Loans" are illegal in my state.

Check Cashers are pretty much as they've been described here. Up here, they're used mostly by 2 groups of people. One group is immigrants who either can't open a bank account or don't trust banks. The second is people in neighborhoods with very few banks, especially the inner city. The big chain out here (All Checks Cashed) charges fees ranging from 1% (payroll checks) to 10% (personal checks).

A lot of local check-cashing outfits have frequent customer discounts. Most offer free money-orders with any cashed check. Most offer money-wiring and transit passes. They also accept utility payments.

I've always had a bank account, but when I lived in the 'hood, I paid my phone bill and bought my T pass at the check-cashers.

[bubbagirl]

.... quit because I didn't agree with the morals behind it....

Payday advance places exploit people's inability to take care of their finances. They get sucked in with the first loan (usually because of a car repair or unexpected expense), and then they have to keep the loan rolling every single payday because they were already living paycheck to paycheck. Many people end up taking out multiple loans (something else comes up unexpected, and they don't have the $ to pay the loan on payday... so they get ANOTHER loan from a different store... and the train derails at about 1 year of borrowing from 3 or more stores each loaning up to 60-70% of your paycheck). It is evil and the owners are making a killing. The interest rate is truly anywhere from 300-400% of the loan value, it does not help your credit at all (loans are never reported unless defaulted, then it is a judgement), and if you end up defaulting on the loan they can also nail you with felony charges of writing a back check on top of the insanely high collection fees. It is a legalized scam.

The owner I worked under was a local chain, not national. He only had 6 locations within the Lansing, MI area. My branch manager and I figured out after ALL monthly expenses were made, including store expenses, payroll, debt loss, etc, the owner was still making about $25,000 each MONTH off PER LOCATION. Meanwhile, I literally a hundred or so customers derail and lose their butts on this loan sharking in my 6 months of employment. The payday advance industry does not give back to the community or the customers, and they have very few laws governing how they can conduct their business.

As for the check cashing... the payday places usually take anywhere from 3% - 12% of the value of the check depending on the type of check and amount it is written for. This is convenient for those that need a check cashed right away and can't wait for the bank to sit on it for 10 days, but I personally would rather deal with my bank at all costs. I do know some just don't have that luxery.

[Dedalus]

I'd love to see some kind of Federal regulation pop up on those rat b----ds that would forgive all the loans, and leave them holding the bag.

[WallStreetWarrior]

Yeah, from what I know, all the info given so far is quite accurate. The only difference between these places and loansharks is you get a bit more financial security with loansharks.