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Why the payday loan industry is such a trap for many consumers

For any person wondering exactly why so much ire descends upon the payday loan industry that operates widely across the country, including in Florida, we offer up a representative hypothetical. Although it is a fictional account, ample evidence exists to confirm that similar stories play out routinely virtually everywhere in the United States.

Consider "borrower." Based on myriad payday lending-related stories, he -- or she, of course -- is having immediate money issues that can't be resolved by the next pay check. Borrower takes out a short-term loan to take care of things.

Those "things" are recurring, though, and the same need for cash arises again. This time, though, the already existing loan balance is accruing lofty interest -- 400 percent or more has been reported in some instances. So, the original loan must be modified.

The cycle repeats in predictable fashion. Over time, and inevitably so, new loans are taken out to simply cover the borrowing costs that already exist and are ever accumulating.

There is seldom a positive ending to that scenario. Indeed, many borrowers who take out payday loans crash under the weight of such flatly onerous exactions. Some lose their homes. Others find that a bankruptcy filing is a lifeline they must take advantage of.

Federal officials are well aware of the outsized dimensions of the problems created by payday loan lenders. President Obama has referenced lenders' profits realized "by trapping hard-working Americans into a vicious cycle of debt." The Consumer Financial Protection Bureau recently proposed a number of reform-minded changes to better regulate the industry in the future.

It is easy to see how the aforementioned "borrower" and millions of other similarly situated consumers can find themselves in a debt spiral that only grows more severe through predatory lending practices.

Some consumers need a way out. They can explore their options through a candid and confidential conversation with a proven debt relief attorney.

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