Jidanii vs. US Army payday loan ?
Jidanii vs. US Army payday loan ?
Fort Stewart has declared these so-called payday lenders enemies at its gate,
accusing them of preying on U.S. troops with high-interest, short-term loans
that plunge them deep into debt.
"It's like riding a merry-go-round - once you get on, it's hard to get off,"
said Frederick Sledge, an emergency relief officer at Fort Stewart whose office
gives interest-free loans to soldiers in financial trouble.
Military bases across the nation have become magnets for payday lenders, which
charge fees as high as $30 every two weeks per $100 borrowed - equal to a 720
percent annual interest rate.
Earlier this month, officials from Fort Stewart and Kings Bay Naval Submarine
Base urged Georgia lawmakers to crack down on such loans, which are illegal
under state law but thrive because of lax enforcement.
Lt. Col. Russ Putnam, a Fort Stewart lawyer, told legislators that stress over
paying off payday loans hurts troop morale and the combat readiness of the
post's 3rd Infantry Division, which led the assault on Baghdad. In extreme
cases, soldiers saddled with debt must be discharged.
"When we lose those people because of payday check cashing, they're as good as
dead to us. They are gone," Putnam told the lawmakers.
Jet Toney, a lobbyist for payday lenders in Georgia, said perhaps the military
needs to focus more on educating troops about money instead of bashing payday
lenders as predators.
"They're not preying on anybody - they're just open for business," Toney said.
"It strikes me hard that the military protests so much when they have some
responsibility on their end as well. How many 18-to-22-year-olds make perfect
financial decisions?"
Navy Petty Officer 2nd Class Jason Withrow, who works on a nuclear submarine at
Kings Bay, took out a payday loan to make ends meet after being hurt in a car
wreck. A back injury had forced him to drop his second job loading beer kegs at
the Navy exchange. Withrow soon found himself taking out loans with other
payday lenders to pay the interest on his initial advance.
"In five months I spent about $7,000 in interest and didn't even pay on the
principal $1,900," said Withrow, 24, of Brooklyn, Mich. "I was having marital
problems because of money and didn't know what to do for Christmas for my kid."
He finally asked his commanders for help. The base emergency relief office
agreed to pay off Withrow's loans. Now he has a schedule to repay the money
over 18 months, with commanders watching over his finances.
"I will never go back to these idiots," Withrow said of his lenders.
Other bases say they have had similar problems with troops sinking into payday
debt.
The lenders "are targeting the post primarily because of the assurance they'll
be paid," said Richard Bridges, spokesman for Fort Carson, the Army post in
Colorado Springs, Colo.
Lenders know they will recoup their money because they can get the Army to help
them collect. Soldiers who do not pay up can face a court-martial and loss of
security clearance, and in some cases are kicked out of the Army.