ACORN turns up the heat on Money Mart

ACORN accuses Money Mart of preying on poor people by charging them high fees to cash checks and 400 percent interest rates for short term loans. “I received a loan from Money Mart for $670, paid back $1,200 and now they say I still owe $300,” said Money Mart victim Shauna Hardeman.

“Money Mart’s ads say ‘Need Cash? Don’t Stress. With a Payday Loan from Money Mart, you’ve got one less thing to worry about.’ But we’re no fools. We know that these loans are easy to get, but hard to pay back. Money Mart wants us to be in debt to them for the rest of our lives,” said ACORN member Paulette Chappill-Otten.

Chanting “Predatory Lender, Criminal Offender!” and holding signs that said “Hey Money Mart, Stop Ripping off Poor People,” 40 ACORN members were joined by allies from the Service Employees International Union, the Office Professional Employees International Union, the Postal Workers Union, UNITE HERE Local 2, the San Francisco Labor Council, Rainforest Action Network, the Grey Panthers and the Community Housing Partnership.

The typical interest rate on a payday loan from Money Mart is 456 percent. While Money Mart says payday loans help people in a one-time emergency, ACORN charges that payday loans are set up so people can’t pay them back and so are forced to repeatedly renew the loans and pay additional interest.

A $300 payday loan from Money Mart costs $352.50. If after two weeks the customer can’t pay the full amount, they pay the $52.50 finance charge and Money Mart rolls the loan over for two more weeks. If, as in many cases, this continues for three months, the customer will have paid Money Mart $341 in interest and still owe the entire $352.50 loan amount.

Last month, ACORN presented Money Mart with a “Loan Shark of the Year” Award for “gouging customers through predatory payday lending, criminal check-cashing fees and rip-off refund loans.”

ACORN (Association of Community Organizations for Reform Now) is the nation’s largest community organization of low- and moderate-income families, with over 175,000 member families organized into 850 neighborhood chapters in 75 cities across the country. Visit http://www.acorn.org.

http://sfbayview.com/040506/loanshark040506.shtml