Payday Loan Solutions and Ethics
Payday loans are often considered as the easiest type of loans to obtain in this day in age; they provide quick and easy money with low hassle and no credit checks. Essentially, all one has to do it write a check and they are out the door with cash in hand. This “solution” delivers something entirely different than what the borrowers expect, rather than helping the borrows in their financial situations, payday loans serve to accelerate a downward spiral of increasing debt and even more financial struggles than before. In ethical terms, these payday loans build wealth only for the lender and ultimately lees the borrower in a worse predicament than the one they were in initially. The basis of ethical reasoning
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This all stems from the fact that borrowers usually lack qualifications for other, more mainstream credit products which is why many people are attracted to payday loans. As lenders lack an accurate evaluation, they apply the highest-risk involved for each individual customer and assume that the risk is great. This situation greatly correlates with deontological ethics as deontological ethics focuses on things we ought to do regardless of the consequences. As mentioned before, payday loans are entirely easier to obtain than regular conventional loans solely because of the lack of a credit check. This attracts many people that do not necessarily think they can pass a credit check, but they do it anyway because often times it is their only option. Payday loan companies rely on people like this, people that believe that payday loans are a good alternative. Now, in Immanuel Kant's eyes, the only thing that is unconditionally good is a good will, everything else, such as wit, intelligence, and control of emotions, can be bad, and used for evil, without a right intention. Payday loan solutions believe that they are there to help the people who are risky, by defending its proportional fees, and ultimately considering that as a “good …show more content…
All of these issues are simply deceptive or even plainly illegal, and somehow oppose every type of natural law. Natural law is simply understood as moral laws found in nature. There are simply laws that all people are subject, no matter their logical customs or conventions. Roman author, Cicero, explained natural law as, “True law is right reason conformable to nature, universal, unchangeable, eternal, whose commands urge us to duty, and whose prohibitions restrain us from evil.” This stands true even when payday loan companies simply have to tell the truth, but they continuously deceive as if they told the truth, business would be
Predatory lending usually occurs when financial institutions take unfair advantage of consumer’s financial needs by extending credit with terms that compensate them over and beyond the credit risk. Predatory lending comes in different forms, but always involve the consumer paying high interest rates and exorbitant fees. Some predatory lending practices include:
Moncrief Company agreed to pay Jim Lester 20% of the gross profit made from the 2013 sales of the Zelenex. Between January 1, 2013 and December 28, 2013, Moncrief’s total available units for sale were, 50,000 units of Zelenex for $30.00 per unit ($1,500,000). Also in addition to the former activities, Moncrief sold 35,000 units for $60.00 per unit ($2,100,000). Moncrief Company uses periodic LIFO inventory method as a result, Jim Lester was to receive $210,000. (Textbook pg.469)
From big financial and ethical scandals like Enron to WorldCom, Wells Fargo may be the next big financial and ethical scandal. Wells Fargo used to be one of the leading banks and credit lending companies in America. Now, they’re on a slippery slope downhill to one of the worst—and most unethical—banking and credit lending companies in America, maybe even in the world. Wells Fargo has been in an ethical uproar, has questionable ethical values, and questionable principles and practices in culture due to their downhill ethical standards. The company also may have been influenced by bad stakeholder judgment, and are now struggling to maintain the company’s culture. To give a description of business ethics as described by John Fraedrich, “business
these things are a problem that needs to be addressed. It is not only unethical and
Financial service providers can misguide or misinform their clients about their services or rights. For example, check-cashing services and tax preparers may charge high interest rates and fees for their services. Working seems to instill in former drug addicts or welfare recipients a sense of competence, pride, and hope for the future. Shipler states that “work works” when other factors and circumstances, a family with multiple wage earners, a sense of competition, job-finding skills, money management skills, and persistence, fall into place.
Etzioni explains that working jobs doesn’t teach teens good money habits. First of all, I don’t believe it is McDonald’s job to teach kids how to use their money. One of the biggest advantages to having money at that age is that they can completely mess up and it won’t affect them in a dangerous way. Having money to spend can teach kids to spend their money wisely. The first several times they see something they want they will buy and find out later when it goes on sale that they messed up. Also teens try to borrow money all the time to get what they want quick. Often times they will end up in debt, but lucky for them they’re young enough that their parents can bail them out. If they don’t have the chance to make these mistakes before they move away, the consequences could be much more
There is, I believe, no easy way to solve the foreclosure crisis. The reason for this is that the underlying problem is not merely the individual foreclosures. The underlying problem isn’t even all of the foreclosures as a whole which constitute the crisis. No, the real underlying problem is ultimately human greed. Consequently, the way to solve the foreclosure crisis, I believe, is not merely through some kind of “stimulus plan.” Yet, this matter shall be examined more thoroughly later.
One cold morning Sam Black woke up with aching chest pain. Troubled by this new condition he went to see his Heart Doctor. Little did Sam know that hours later he would be lying on the operating table in route for a triple bypass surgery. The surgery went as planned, but it was not the last of them. Sam was sent to many specialists and rehabilitation centers, building a large bill, which they had no money to pay them with. He still pays several grand a year for the medication he is prescribed. Years after the operation Sam and his wife, Elsie, have narrowly escaped foreclose, however the most problematic debt they have is the hundreds of small term loans with interest rates in the triple digits. Elsie once said in an interview regarding the loans they had to take out, “You can’t really keep up with them” (Wright, 2011). Almost a decade later Sam has trouble speaking and has to carry around an oxygen tank. This is a normal couple that got caught in the continuous cycle of payday loans. Like other millions of Americans The Black family settled for shady overpriced short-term loans.
With the advent of the internet, more written material is being published than ever before, including essays written to fulfill college assignments. Is it any wonder that many students, ill-prepared by a culture of quick-fix solutions, choose to buy essays available online and submit them dishonestly as their own work? No. It's predictable.
We now live in a society where kids start their adult lives “in the red”, as their debt exceeds their income. (Draut, 2005) 60 years ago this wasn’t the case, as told by Studs Terkel in Hard Times-An Oral History of The Great Depression, “I had no idea how long $30 would last, but it sure would have to go a long way because I had nothing else. The semester fee was $22, so that left me $8 to go.” (Turkel, 1970) Imagine that! 60 years ago tuition was $22 dollars a semester! Furthermore, 45% of adults under 35 state they find themselves resorting to credit card use for basic living expenses like rent, groceries and utilities, (Draut, 2005) adding to their mounting debt. This use of credit puts them into an entirely different category of indebtedness: survival debt. (Draut, 2005) Imagine being forced to borrow to live! (Draut, 2005) If a car breaks down or someone gets sick, the only option available is using a credit card. (Draut,
Credit cards are something that are almost needed in everyday life now, as most dont have the money available to purchase a car or house and so need credit, thus needing credit cards to help build that credit. Those cards are hard to handle, and receiving applications in the mail daily, and commercials appearing on television don’t seem to make the struggle of staying away any easier. This starts to spark an interest. So people begin to think, "I think I 'm responsible enough to get a credit card, I 'll only use it for emergencies." Then the application process begins and it may take a couple times to finally be approved for one. This only makes it worse, of course, because realizing how long a credit card wasn’t applicable to life, but now
A guy in $50,000 of debt has got to be irresponsible with his money right? Actually, it is more likely that he is a college student. Hundreds of thousands of college students around the country are in a financial predicament because of the government?s impersonal financial aid policies. The federal government?s current system has too many quirks which end up hurting the people that financial aid is supposed to help. The federal government should change its financial aid policies to take several more factors, such as the percentage of educational expenses paid by the student, into account.
This is supported by the study of Hakim and Haddad (1999) which found that the loan repayment obligations related to income and are an important factor in the possibility of default.... ... middle of paper ... ... According to the Credit Counselling and Management Agency (CCMA) (2012), the main reasons people fail to pay a debt were poor financial planning (25%), high medical expenses (22%), business failures or slowdowns (15%), loss of control over the usage of credit cards (13%), and loss of jobs or retrenchments (10%). Therefore, Lea, Webley and Walker (1995) found that debt with economic, social and psychological factors are closely related.
William O. Douglas said, "Common sense often makes good law." Well that is what laws essentially are, rules and regulations that make sure common sense is followed. One could even say that laws are enforced ethics. Laws serve several roles and functions in business and society, and this paper will discuss those roles and functions.
The lack of knowledge plays a big part in the debt young people are getting themselves into. Credit cards are often offered to young adults as soon as they get out of high school. Many take advantage of having a credit card without even thinking about the responsibilities that come with it, instead they think about the things they will be able to buy. In “Generation Debt” the author Tamara Draut says that young people are getting into debt younger than ever before. Two of the reasons that are more costly on young students that hit hard on the budget are car repairs, and travel for students who have families and friends in other states (231). From my experience I know first-hand what it was like to be offered credit cards right out of high school, and I didn’t hesitate to get any of them. I st...