Brennan’s Call for Protest Reveals Support for 36% Rate Cap

Remember loan shark/pawn king Chuck Brennan’s effort to push his debtors to contact the Governor and the sponsors of the new 36% interest rate cap and urge them to repeal this payday lender-killing regulation? One of Brennan’s targets, initiative sponsor Rev. Steve Hickey, kindly shares some of the messages he’s received from folks responding to Brennan’s urging:

Thank God for your great service. Thanks again. Yeah.

Measure 21 us the best thing for South Dakota BACK OFF DOLLAR LOAN CENTER.

I see that your name has been added to the Dollar Loan Center website and as a result you will likely be receiving many “crank” emails.  I was thrilled to see your email so that I can say the opposite:  WELL DONE in getting that measure passed!

Chuck Brennen from the Dollar Loan Center sent this to all it’s customers because this forces him out of business in South Dakota.
http://www.dontbebroke.com/south-dakota-notice/

Please do NOT take any action to repeal South Dakota Measure 21.  The public has spoken with overwhelming support of 36% interest rate cap.

Thank you!

The only real negative Rev. Hickey reports receiving is this tale of woe:

I want to tell you I was close to death. All my organs were shutting down. Most people died from this blood infection. Only got paid a third of my wages. I can’t get a cash advance from my job. Went to get a loan. No cause you and Hildebrand made this law out to help us. I don’t thank you. I have no gas to get to work no good. I don’t want hand outs I have worked my entire life without. The doctors say I was lucky I lived. No I wish I hadn’t. You rich people think us poor people your helping. Your not. But it’s okay for drinking. One senator drank and drove here. In Watertown sd killed a man on a motorcycle. He was found guilty. Guess what he got weekends in jail. If it was someone off of the streets we would be in the Penn. All I do is work and stay home can’t afford anything else. I bet you can buy whatever you want. Eat out!! I don’t. Buy clothes. I don’t. Thanksgiving I will have a sandwich at home. So I don’t wish for you to be poor and work and have nothing. I have had the same job for 19 years so it isn’t like I don’t work. So I don’t thank you!! You guys should be able to answer your phones. Since you made the law to help us poor. I don’t want hand outs. I can’t get a loan through a bank. I didn’t plan on coming that close to death. Doctors say I need to gain wait. All I can afford is one sandwich a day. Since I can’t get a loan cause of what you got passed. I don’t wish this on anyone. To be working and broke cause of being sick. I will not get food stamps. Medical bills pouring in. So if you’re going to hurt the poor. Why don’t you making drinking against the law? So senator don’t kill people. Thanks for making me wish I had died.

A doctor here missed Diagnosis me. I called other doctors none of them would see me. Go to er. I go to er everything shutting down. I got one lung now and one kidney. If the doctor would have caught it I wouldnt have been taken to soiux falls. Then that doctor gave the wrong meds. Then bills me. He took blood and still did it wrong. Thanks to all the rich people. Er nurse’s said get her out of here she is going to die on the table.

I just want to thank you all for nothing. All the people who have money. And don’t care about the hard working people.

Hmm… I don’t think the 75.58% of South Dakota voters who approved the 36% rate cap are rich people who don’t work hard.

If that sample at all matches the kinds of messages Governor Daugaard is receiving, we can count on no pressure from the top to repeal the reasonable 36% rate cap on payday loans. Chuck Brennan may have to focus on whatever Quality Lenders is trying to do in seeking some new designation from the South Dakota Division of Banking to resume making loans in South Dakota.


24 Responses to Brennan’s Call for Protest Reveals Support for 36% Rate Cap

  1. If the person with the tale of woe takes out a payday loan to buy a sandwich she (?) will either have trouble paying off the loan or buying a future sandwich. There is better help for this person than a loan from a payday lender that would just exacerbate her dire economic situation. SNAP (food stamps), local food pantry, church programs for food and financial assistance, the county for medical bill payment and housing assistance and utility assistance, a request to the medical provider to write off medical bills. And of course family.

  2. I do find the tale of woe suspicious though. The only thing this person spelled correctly was Hildebrand.

  3. That’s what I thought immediately, Rohr.

  4. Steve Hickey

    Here’s the only other email that came and my reply is below it:

    Dear Steve Hildebrand, South Dakota Division of Banking, Tony Venhuizen and Dexter Gronseth,

    I’m writing to you today wanting to voice my position on IM 21 that was passed on Nov. 8th 2016 and how this affects me personally and professionally. I work for a short term lending company but I have also borrowed from a short term lender before. Not only does IM 21 leave me jobless if it is not amended or appealed, but it also leaves me with nowhere to go to get funds for emergencies. I do not have the best of credit due to being 18 and immature and ruining my creditability when it comes to lending. I have had to use short term lending to help pay for my sons dental fees that had to be paid upfront to the provider. I have used it to help pay for car repairs and many other things. I work 3 jobs to be able to provide for my family. We live pay check to pay check and sometimes that is not good enough. We don’t qualify for help from the state like food stamps, electric assistance, housing assistance etc. Because the state says we make just too much money per year. (That would be why I work 1 full time job and 2 part time jobs).

    Well where do I go now when my son needs to see the dentist again or my car breaks down? Should I come knock on your door? Yes I could try to go the bank but I have before and they won’t do anything for me. My church well I don’t belong to one so I don’t think they would help me. My family? Could ask them but my mother is a widow and now lives in Montana and my 2 siblings have their families to take care of to and they too live in different states.

    So my question is should I knock on your door and ask for help when I need it. Since I’m soon to be filing unemployment on my full time job that you and the representatives took away from me.

    What do I do now?

    Sincerely a Concerned Resident of South Dakota,

    MY REPLY:

    Thanks for your note. I’ve only received one other since this law passed from someone upset that it passed. However, many many have written to thank us. These lenders have ruined lives. People are worse off with these loans than before. I’ve been telling people publicly, and it’s been covered in the news, that if you are working for a payday lender find another job now – jump ship early – because every poll shows what you saw in the vote result – 76% of the state believe these loans take advantage of people, not help them. If your employer was honest with you he would have said start looking elsewhere long before Nov. 8 because he was no doubt aware his product is deemed by the public to be a product that exploits the poor and elderly. He no doubt knew the outcome of this vote. Every gold rush winds down sooner or later. I wish your employer was more forthright with you.

    There are roughly 120 places in South Dakota that are effected by this law change and under 500 employees statewide. Factories close all the time with great numbers than these and people suddenly need to find work. It is very unfortunate but in this case these places are spread out all over the state and, we have one of the lowest unemployment rates in the nation. That means there are lots of jobs available. When I was a legislator the number one thing I was hearing from the business leaders in my district was they couldn’t find reliable employees. I’m confident you will be able to find a better job and there are state agencies to help if you need help.

    Yes, come knock on my door if you have no where else to turn. People have been doing so for years and that i why I started to get mad at these lenders. People would borrow $200 and soon owe $2000 and then lose their car unless someone like me bailed them out. Our church helps people all the time and what we have built in our coalition is a network of churches around the state willing to help people find work and get a car fixed if needed. You don’t have to go to one or belong to one to get help. I can’t tell what part of the state you are from but I know people around the state who are happy to help someone in a true need. Those loans are toxic, like giving rotten meat to a starving people. I know that credit unions offer $1000 at 18% in South Dakota and that they are planning to offer more affordable small dollar loans now that the loan sharks are gone.

    I wish you a Happy Thanksgiving and if you don’t have the means to have a Turkey meal on your table for your family, let me know and I’ll see that you eat well.

    Blessings

    Steve Hickey

  5. I strongly supported IM 21 and the defeat of Amendment U. The loss of these usurious lenders is good news. (And i agree with John Oliver on predatory lenders.) However, the need for small, short term loans is real. An injury or illness, even minor, resulting in missed work days or hours; a child’s illness; an auto repair; a minor traffic ticket; a missed utility, phone, credit card or medical bill payment: any one of these can cause a major problem with paying rent and bills, buying gas or medicine, or putting food on the table. And many people simply have no family or friends who are in a position to help out. (And i know some of these people; they are neither lazy nor stupid, but have had some bad luck, often health-related, and often due to the misfortune of not having been born into a family with resources.) Furthermore, the restrictions on food stamps, SNAP, food pantries, etc, are such that these resources are not an option for many folks; nor are counties, utility companies or medical providers willing to assist or write off these bills, as far as i know. (Incidentally, the expansion of Medicaid, now a lost hope, would have been a big help to so many in these economic straits.) Is there any resource that could be developed to provide small, short-term loans at a 36% rate or lower for people?

  6. Your comments are true, c carter. Pawn shops are an option for people. Almost everybody has some item they can live without temporarily or permanently that they could use for collateral for a loan.

    From my experience, providing anything based solely on somebody’s promise to pay is a risky scheme because many of the people who would take you up on this either don’t have the ability to pay or they do have the ability but they lack the character to stand by their promise to pay. Requiring people to have some skin in the game – to post collateral – is a reasonable business plan in my opinion.

  7. Beautiful response there Mr. Hickey and spot on. Payday lenders could still make payday loans and still make profits, but they do not wish profits, they want it all. Good news with the credit unions and their stepping up for the communities. Thanks for your efforts, good luck finding lamb there for your Thanksgiving meal, watch that Haggis, it can be tough going.

  8. Mr. Hickey, wasn’t that Trump’s campaign promise? A turkey on every tv screen for the next 4 years

  9. But are we taking the predatory lenders’ point of view and assuming that a 36% interest rate cap is prohibitive? What is the actual default rate, and how are potential loan applications evaluated (surely not all have to be accommodated)? Is there a slight possibility that the for-profit lenders’ profit margins are higher than, say, a non-profit (ormore modestly profitable) loan organization might accept?

  10. Herre’s the math, c carter. If you make a $300 loan to someone for 1 week at 36% you make $2.08 profit. Would you loan someone $300 hoping to make $2? If that one customer failed to pay, it would swallow the profit from almost 150 other $300 loans! In other words, if you made 150 loans and just one person defaulted you would fail to break even. This doesn’t even take into account the cost of overhead to run a business and hire an employee. There is no business model that could make short term loans such as these work at 36% interest – except requiring people to put up collateral. Not even a non-profit could give 36% loans without taking collateral unless they have a lot of money they plan to lose.

  11. She can come knocking on my door too. I would help her, specifically with food.
    I bet there would be plenty of DFP people right here that would reach out to her.

  12. Dang, and I thought SD was low cost of living.

  13. Porter Lansing

    Level One phraseology (the kind that can tell you who the anonymous posters on Pat Powers blog really are) will tell you that both letters are phony.

  14. Move all your business to the racetrack great place for it.

  15. Porter Lansing

    Many can’t determine what an emergency actually is. It’s similar to the difference between fear and anxiety. If your car breaks down, catch a ride until you can save up enough to fix it. If your kid needs dental work done, wait and save up the money. If you need a sandwich, go through a dumpster and wait until you can save up the money. What you “think” is an emergency is commonly a lack of patience intensified by selfish desire for immediate satisfaction. If you’d have saved up at least one paycheck, you’d not have to wait for the next one. Don’t let it happen again. Everyone can save money. In conclusion the decision to get ripped off at a loan shark is mostly a personal problem derived from lack of discipline.

  16. Roger Cornelius

    For the person complaining to have medical problems with the bills piling up, they should contact Governor Daugaard about their tale of woe. This person would be a perfect candidate for Medicaid Expansion.

    Porter is probably right, these emails seem to be contrived and don’t serve the writers, but the payday lenders.

    I’ve been working with a young lady helping to restore her credit and learning to live payday to payday.
    The first thing we did was to open a money management account, not a checking account, at a local bank, these types of accounts help you see where your money is being spent and how you can do better.
    She also puts $25 into a savings account, while this may seem like an insignificant amount to most she was pleased to learn that she now has over $1,000 saved that can be used for an emergency and she won’t be paying a payday lender exorbitant fees and owning you for the rest of your life.
    For low and middle income people money management and savings are critical to financial survival.
    You can survive by not doing impulsive buying, you don’t need to stop at local stop and shop twice a day for coffee or sodas and for God’s sake quit eating fast food that is both costly and unhealthy.
    Create a budget and stick to it, you may find that you have more money than you realized.
    People survived before payday lenders and they can do so again and be happy and not carry the burden of an unnecessary expense.

  17. Porter Lansing

    Well put, Mr. Cornelius. It’s documented that these loan rapists demand letters like this, written under duress, from employees and delinquent borrowers.

  18. Pawn shops are enjoying a boom in business since the 36 percent cap. They are expempt from the 36 percent cap. Brings the business to many small business owners. That is a good thing

  19. mike from iowa

    That pheasant looks like it means business. The other turkey, not so much. Good one, Ror.

  20. Sam makes the case for the use of those storefronts then. More pawn shops! Whatever works until the Credit Unions get up to speed.

  21. ” . . . sent this to all it’s customers . . . ”
    It’s means “it is”.
    The possessive firm is “its”.

  22. Steve’s response is the best Thanksgiving message I’ve heard all week. Roger’s help for the young woman he knows is perfect. Lutheran Social Services could step in here, offer short-term loans with minimal interest but a requirement that borrowers attend their credit counseling services, akin to what Roger’s doing, so they never need to come back for an emergency loan again.

  23. private richard

    ass of woe, i suggest you call any of a number of social services and ask their assistance. your spelling is atrocious xpaledocious!!!