Help pack a million meals for struggling seniors on Sept. 11. Volunteer today


Military and Veterans Discount

Contests and


Free AARP E-Books

Protecting Yourself Online for Dummies

Here's the mini guide you need to steer through the hazards with confidence.

Learn More


AARP Games - Play Now!


AARP Staying Sharp: Keep Your Brain Healthy

News & Politics Forums

Share your opinions on news and current events that matter most to you.

Join the discussion »

AARP Auto Buying Program




Bill Would Ease Rules on Payday Loans

AARP is part of coalition opposing measure

In an email, Ross said, "An APR is meaningless on a two-week loan that must be paid off and can't be rolled over, as is required under my bill. Without my bill, loans can be continued for a year without being settled, incurring new interest charges for a year, so it would be possible to accumulate an APR of 325.89 percent."

Targeting the poor

The bill's opponents say payday lenders purposely target the poor. They cite a 2008 analysis by Steven Graves, a geography professor at California State University, Northridge. Graves, who has researched the locations of payday lenders, studied neighborhoods in Alabama, California, Montana, Ohio and Washington, D.C., and found short-term lenders clustered near subsidized housing for low-income older and disabled residents. The industry's trade group denied that lenders purposely cluster near these housing units.

"They do have a pattern of going after any demographic that has a guaranteed [government] source of income, especially one that is inadequate to regularly cover living expenses," Graves said.

Payday lender Check 'n Go wants to expand into Pennsylvania. John Rabenold, a lobbyist for Check 'n Go parent company Axcess Financial, said his firm doesn't seek out neighborhoods with subsidized housing.

"I've been here 14 years, and it's never been a criteria that my company has used," he said.

Although payday lenders have no locations in the state, some Pennsylvania residents have borrowed from companies with offices abroad, in other states or on American Indian reservations outside the state. 

The state Department of Banking has punished some out-of-state payday businesses who lent to Pennsylvanians. In February it fined a Delaware lender $150,000 after several residents filed complaints.

Landis said cash-strapped older people have options other than payday loans, such as borrowing from friends or credit unions.

Pennsylvania credit unions lend up to $500, due within 90 days at an 18 percent APR. Most major credit cards offer cash advances with an APR around 25 percent.

"We certainly don't feel that running up debt on any credit card is a good idea, but the interest rate is much lower," Landis said.

Rebecca VanderMeulen is a writer living in Downingtown, Pa.

Also of interest: Payday lenders target Social Security recipients. »

Topic Alerts

You can get weekly email alerts on the topics below. Just click “Follow.”

Manage Alerts


Please wait...

progress bar, please wait

Tell Us WhatYou Think

Please leave your comment below.


Discounts & Benefits

From companies that meet the high standards of service and quality set by AARP.

member benefit aarp financial service auto insurance

AARP® Auto Insurance Program from The Hartford offers members no-cost quotes.

membership benefit financial college aarp

Advice on saving for education from AARP® College Savings Solutions from TIAA-CREF.

AARP Credit card from Chase

Members can earn 3% cash back on purchases with the AARP® Credit Card from Chase.

Member Benefits

Join or renew today! Members receive exclusive member benefits & affect social change.

Rewards for Good

Your Points Balance:

Learn More

Earn points for completing free online activities designed to enrich your life.

Find more ways to earn points

Redeem your points to save on merchandise, travel, and more.

Find more ways to redeem points