Maine Consumer Bureau Warns of the Cost of High-Interest Loans
PORTLAND, Maine - Maine's Department of Consumer Protection is warning Mainers about the true cost of high-interest loans.
According to a publication out today from the department, Mainers are accessing loans - some unlicensed in the state - that end up costing them thousands of dollars.
David Leach is with the Bureau of Consumer Credit Protection -- he says he's seen cases of this all over the state.
"Somebody will say, 'I was on the internet at 2 in the morning, I filled out all these forms, I gave them my bank account numbers, the routing and transit and the account number, I asked for $500 and I got $500; I've been making payments for four or five months. I paid them over $1,500; I asked what my balance was, and they say it's only gone down by $20. }
Leach is talking about payday loans, personal loans, private student loans, certain car loans, loans at casinos, and pawn loans; also, credit cards, and rent-to-own.
The bureau is advising people to use cash whenever possible, and to figure out how much loans will actually cost before taking them out.