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February, 1999
This article was written by the Consumers Union Southwest Regional Office.
The TreadmillA Houston woman wrote to the Office of Consumer Credit Commissioner when she couldn't pay down her debt to Emergency Services, no matter how many payments she made. According to her letter, she anwered an ad in the paper offering $200 loans in five minutes with proof of a checking account. After approving her loan by phone, Emergency Services said she would have to put up two appliances. She brought in the model numbers for a microwave and a T.V. and began to write checks, leaving the "pay to" line and the date blank. Emergency Services said she would have to pay $264.95 in two weeks or $64.95 every two weeks. "We had to keep paying $64.95 every two weeks and if we were late it was $4.95 a day late charges." This borrower, who lived on an income of only $586 per month Social Security Disability, got behind in her payments. "On May 3rd I would have sent another $195, but my daughter's alternator went out and it was $265 and we couldn't send it and she started running checks through--that we had already paid her. She had us write checks and leave the name and dates blank. We have our receipts. When I asked her for the checks...she said when we paid off the loan we would get the checks." The company pressured the borrower to pay in cash rather than with money orders, and once the manager asked them to meet her at a local mall and bring cash. The desparate family finally called the state for help. "My daughter agreed the $200 loan for me. They call it a lease agreement," she wrote. |
