Part 2: Payday & Auto Title Lending – Stories from the Community

By Alexis Christensen

I’ve long been drawn to understanding how governmental systems work—whether it’s politics, civic engagement or policy. Often we think about law or policies from an impersonal perspective, but in reality, they can be very personal.

In Part One of this series we learned about the devastating effects payday and auto title lending has on our residents and our city. Because of the negative outcomes produced by these loans, many believe now is the time for action. In the world of community development, the grassroots movement becomes effective in creating change when community members who have experienced, dealt with or struggled through the situation voice their personal stories and ideas into the work.

So let us turn to the voices of the community, who have dealt with the negative effects of payday and auto title lending firsthand. For a moment, let us listen to the voices of experience.

Ms. Lewis, tell us your story.

Lewis: I am a single parent of two kids. My son is 17 years old and chronically ill and I have a 19 year old daughter in college. I got into desperate times and needed money due to my financial situation. I have to travel a lot with my son [to visit doctors]. He requires medicines through IV and has frequent doctor visits. Then I found out my daughter had medical issues too. I kept seeing all these ads and signs, so I went and got an auto title loan.

Christensen: How was that visit?

Lewis: Well, when I got the loan they made me feel so comfortable and they were so friendly but come to find out they were wolves in sheep’s clothing. As a single parent, I am stressed. I am trying to keep up with the bills and sometimes it’s hard but I do what I can to manage. When it comes to payday lenders, yes they are so nice and sweet when you first come through the door but…I wish I had never done it because of the outrageous fees they charge with interest and the harassing calls…When my son was in the hospital, they called me just about every day threatening to come and take my car, it was awful.

Unfortunately, Ms. Lewis is not alone in her experiences with payday and auto title lending. Let’s hear from Mr. Thomas, who is a veteran.

Mr. Thomas, tell us your story.

Thomas: I was in school and temporarily unemployed and took out both an auto title loan and a payday loan to catch up on my water and electric bills and pay for school. I actually got a job in the same week I took out the auto title loan, but couldn’t keep up with the loan payments and had my pickup repossessed. The original loan was for $1,000 and the auto title loan was for $4,000. I’ve been charged twice the amount of the original loans.

I’ll be paying these type of loans off forever because of the interest. There is no way to catch up. Me and my wife are currently trying to adopt our nieces and credit issues have come up as an issue [in the adoption process].

Lastly, let’s hear from Ms. Marks.

Marks: A long while ago I got an auto title loan for $500 and ended up paying $2400 on the whole thing. Loan interest rate was about 800%. I belonged to a credit union and explained situation and they bought out the auto title and payday loan.

It was so hard to get a loan anywhere else besides a payday loan place. The stores keep calling and asking about getting another loan. At [a local payday loan store] I got a loan for $150 and I’m on the way right now to pay $51 in fees today to extend it for two weeks and it won’t go toward principal. I have 6 months to pay it in full.

If I could change anything about them, lower the interest rate. They get away with it [high interest rates] because they say they’re not the lender and they can’t do anything about it.

These stories have come from people right here in our community. These brave ones have shared some of their most vulnerable moments with us to help see change happen at the local level. This is why the ordinance to help address the issues payday and auto title lending create is vitally important to our community. The ordinance is one part of the solution; we also need sound alternatives and education to see true systemic change. Find where you fit in this work and help create a flourishing Waco for all of us.

*Some names have been changed to protect the identity of the community members.


AlexisAlexis Christensen is a Community Organizer at Waco Community Development Corporation (Waco CDC).

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