Colorado Cash Advance Loans Bill Raises Debates

The issue of Colorado cash advance loans has been in the legislation for some time. It is stirring up some debates and there are advocates both for and against them. Larry Liston, a Republican, takes the stand that such loan advances are good for the economy, good for consumers, and that they offer jobs to approximately 500 people with that number climbing.

This is why a bill that was introduced isn’t designed to end payday loans in Colorado. Instead, the idea is to give people more time to repay what they borrow. The loan period used to be only up to 2 months and it could now be extended as much as 6 months. As a result, it can help the economy in Colorado to improve. Yet many worry that this extension is only going to make people more dependent on payday loans. They worry that it could result in people being encouraged to borrow money again in the future through this type of loan offer.

The bill also would like to see consumers paying the loan origination fee up front. This particular loan origination fee can be up to $20 per $100 borrowed for loans up to $300. For loans up to $500 the fees can be $15 per $100. The finance charge can be up to 45%. However, the lender does have the ability to offer lower fees and lower rates of interest if they would like to. Many of the online lenders do so in an effort to entice consumers to borrow from them and not one of their competitors.

One of the issues in legislation is that the lawmakers would like to completely do away with the loan origination fees. However, many of the payday lenders in Colorado state that it is necessary for them to charge those fees if they are going to be able to continue covering the operational costs of their payday loan business.

Legislation would like to see consumers being well informed about the cost of borrowing funds too. This will ensure that those in Colorado borrowing such money will be able to see just how much money it is going to take to fully pay back their loan to that lender. That dollar amount could prove to be discouraging though for those that tend to rely too much on payday advance loans to get them by.