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January 2022 Newsletter
Issue #59
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Each year, 12 million borrowers spend more than $7 billion on payday loans.
There are approximately 23,000 payday lenders in the U.S., almost twice the number of McDonald's restaurants.
On average, a borrower takes out 8 loans of $375 each per year and spends $520 on interest.
The average interest rate on a payday loan is 391% and can be higher than 600%.
The average payday loan borrower is in debt for 5 months of the year.
Groups that have higher odds of using a payday loan are:
- People without a four-year college degree
- Home renters
- African Americans
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People earning below $40,000 annually
- People who are separated or divorced
Although payday loans are advertised as being helpful for unexpected or emergency expenses, 69% of borrowers use the loan to cover a recurring expense, such as utilities, credit card bills, rent or mortgage payments, or food. 16% use the loans for unexpected expenses, such as a car repair or emergency medical expense.
81% of those who have used a storefront payday loan would cut back on expenses such as food and clothing if payday loans weren't available.
The average fee at a storefront loan business is $55 per 2 weeks.
Payday loans are usually due in 2 weeks and are tied to the borrower’s pay cycle. Payday lenders have direct access to a borrower’s checking account on payday, electronically or with a postdated check. This ensures that the payday lender can collect from the borrower’s income before other lenders or bills
are paid.
Auto title loans are similar to payday loans, except that the average loan is $1,000 and is secured by a borrower’s car title. Roughly 2.5 million Americans spend $3 billion on auto title loan fees each year.
The average payday loan requires a lump-sum repayment of $430 on the next payday, consuming 36% of an average borrower’s gross paycheck. However, research shows that most borrowers can afford no more than 5% while still covering basic expenses.
Most borrowers renew or reborrow the loans. 80% of payday loans are taken out within 2 weeks of repayment of a previous payday loan.
The payday lending business relies on extended indebtedness: 75% of payday loans go to those who take out 11 or more of the loans annually.
Federal law dictates that fees are capped at 36% for payday loans for all members of the military.
The payday loan market is not price competitive. Most lenders charge the maximum rate allowed under state law. States without rate limits have the highest prices.
Payday loans are available in 36 states. The other states effectively prohibit these loans by capping rates at a low level or enforcing other laws.
The biggest states for payday lending are California, Texas and Nevada.
4 states have set caps on payday loan interest rates: Colorado, Montana, New Hampshire, and South Dakota have an annual interest rate limit of 36% and ban any additional fees.
Use of payday loans drops from 6.6% in states with the least regulation to 2.9% to states with the most stringent regulations.
The 3 largest payday lenders are: Advance America, Check Into Cash, and Cash 'N Go. Of these, only Advance America is publicly held, and it is by far the largest. Other large, publicly held payday lenders include QC Holdings, Cash America, Dollar Financial, EZCORP, and First Cash Financial.
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Payday Loans Laws by State
A graphic from Elite Financial Services, that shows
in which states payday loans are legal, annual percentage rate regulations, loan amounts, loan terms costs per $100, and small loan rate caps.
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Payday Loans: Who Uses Them and Why?
A short animated video from Pew Research that follows the story of Jennifer, a fictional character who represents a typical payday loan customer. Jennifer is unable to pay her loan back and keeps renewing it. Ultimately, she ends up paying more in fees than she received in credit, and has to borrow money from her parents to settle the debt.
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Cathonomics:
How Catholic Tradition Can Create a More Just Economy
By Anthony M. Annett. An ethical and practical guide to creating a world economy that is more prosperous, inclusive, and sustainable for all. Combines insights in economics with those from theology, philosophy, climate science, and psychology, exposing the failures of neoliberalism while offering a new model rooted in the wisdom of Catholic social teaching and classical ethical traditions. Drawing from the work of Pope Leo XIII, Pope Francis, Thomas Aquinas, and Aristotle, applies these teachings to discuss current economic challenges such as inequality, unemployment and underemployment, climate change, and the roles of business and finance. Read more.
(Note: Available January 10th)
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Using Your Voice is a Political Choice
A TED Talk featuring Amanda Gorman -- the youngest inaugural poet in US history. She says that poetry is for everyone, and at its core it's all about connection and collaboration. She explains why poetry is inherently political while paying homage to her honorary ancestors and stresses the value of speaking out despite our fears. "Poetry has never been the language of barriers," Gorman says. "It's always been the language of bridges." Watch now.
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Looking for the Good War:
American Amnesia and the
Violent Pursuit of Happiness
By Elizabeth D. Samet. Reexamines the literature, art, and culture that emerged after World War II, to bear on the complexity of the postwar period in national life. Exposes the confusion about American identity that was expressed during and immediately after the war, and the deep national ambivalence toward war, violence, and veterans―all of which were suppressed in subsequent decades by a dangerously sentimental attitude toward the United States’ “exceptional” history and destiny.
As the United States reassesses its roles in Afghanistan and the Middle East, argues that the time has come to rethink our national mythology: the way that World War II shaped our sense of national destiny, our beliefs about the use of American military force throughout the world, and our inability to accept the realities of the twenty-first century’s decades of devastating conflict. Read more.
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Dark Money and the Politics of
School Privatization
By Maurice T. Cunningham. Goes behind the scenes of school privatization campaigns to expose the complex networks of funding that sustain these efforts - often hidden from the view of the public. Using the example of a 2016 Massachusetts charter school referendum, shows how wealthy individuals support charter school expansion through so-called “social welfare” organizations, thereby obscuring the true sources of funding while influencing major public policy votes. With vast wealth and a political agenda, foundations have helped to reshape the reform landscape in urban education. Read more.
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Sustainable
An investigation of the economic and environmental instability of America’s food system, from the agricultural issues we face — soil loss, water depletion, climate change, pesticide use — to the community of leaders who are determined to fix it. Sustainable is a film about the land, the people who work it and what must be done to sustain it for future generations. Watch the trailer.
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A Vision of Sustainable Housing
for All of Humanity
A TED Talk, featuring architect Vishaan Chakrabarti, who wants viewers to think about how we're going to house the 11 billion people projected to populate the Earth by 2100. He argues that new construction can fight climate change rather than make it worse and proposes a "Goldilocks" solution to sustainable housing that exists in the sweet spot between single-family homes and towering skyscrapers. Watch now.
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Why is 1.5 degrees Such a Big Deal?
A brief, animated TED Talk, featuring Kristin Bell, that answers one of the key questions about climate change. Watch now.
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First To Go: Story of the Kataoka Family
This award-winning documentary from New Day Films focuses on the story of a Japanese-American grandmother who recounts her father's incarceration during World War II and the ramifications it had on her family. Weaving through her story, her grandson's experience, and archival footage, the film shows the impact traumatic events can have across generations. Learn more.
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The Jesuit Border Podcast
A resource from several recently ordained Jesuit priests working in the diocese of Brownsville, TX, along the U.S.-Mexico border. Each week they publish episodes that highlight stories from their ministry which has included helping at a pair of local parishes, working at Catholic Charities’ Humanitarian Respite Center (HRC) for migrants in McAllen, visiting migrants living in tents in the plaza of Reynosa, Mexico, and joining unaccompanied minors from local migrant detention centers for Mass every Sunday. Episodes feature interviews with someone particularly involved in the Catholic response to the on-the-ground reality. The podcasts are a mixture of storytelling, fact sharing, and theological reflection to capture the reality on the border – difficult as well as hopeful, reflections on life and beauty as well as reflections on extreme suffering. The goal is to show the response to the border situation through the eyes of the people who walk with migrants day after day. Learn more.
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Hope Border Institute
Brings the perspective of Catholic social teaching to bear on the realities unique to the U.S.-Mexico border region. Through a robust program of research and policy work, leadership development and action, works to build justice and deepen solidarity across the borderlands. Learn more.
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A Policymaker's Tool for Effective, Nonviolent Strategies for Sustainable Peace
A resource from Pax Christi, that invite policy makers—including church leaders who have influential roles in public policy processes—to join their mission by considering, adopting, funding, and implementing policies that promote nonviolent options in response to violent or potentially violent societal challenges. This publication defines nonviolence and peace with justice in relation to
public policies. In the chapters thereafter, concrete examples are given of effective and time-tested
nonviolent strategies in specific contexts around the world. Learn more.
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New Day Films
A filmmaker-run distribution company, that has been providing social issue documentaries to educators since 1971. Subject areas include: education, the environment & sustainability, human rights, immigration & border studies, law & criminal justice and peace & conflict studies. Learn more.
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How to Bring Restorative Justice to Your Parish or Ministry
A four-part webinar series from the Catholic Mobilizing Network. Each segment is 1.5 hours long and features these topics:
- Public Education and Community Resilience
- Creating a Restorative Ministry
- Supporting a Restorative Initiative
- Becoming a Restorative Institution
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Important Dates This Month
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Individuals Honored This Month
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January 6th
At stake are two different visions of faith, the Church of Caesar, powerful and rich; and the Church of Christ - loving, poor and spiritually rich.
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January 7th
This is our cry, this is our prayer:
peace in the world.
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January 14th
The first step in the evolution of ethics is a sense of solidarity with other human beings.
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Janaury 14th
For politicians truth and falsehood are unimportant. So I never could become a politician - not even a church politician.
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January 15th
Injustice anywhere is a threat to justice everywhere.
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January 24th
Jesus didn't say, 'Blessed are those who care for the poor.' He said, 'Blessed are we where we are poor, where we are broken.' It is there that God loves us deeply and pulls us into deeper communion with himself.
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January 31st
Peace demands the most heroic labor and the most difficult sacrifice. It demands greater heroism than war. It demands greater fidelity to the truth and a much more perfect purity of conscience.
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Since 2017, more than 230,000 people have visited the Social Justice Resource Center website. We provide a wide variety of facts and figures on specific social issues as well as thousands of free resources including films, publications, links to other organizations, prayers, quotes, principles of social justice, key dates throughout the year, action ideas, Diocesan office contact information and biographies of famous people who have worked for social justice.
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please let us know!
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