“They gave me $ 2,800… I paid almost $ 5,000.” Now she could finally end her payday loan.

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From Texas Standard:

The average American family will be spending $ 900 this holiday season. If you are one of the lucky 22% of Americans who will receive a bonus this season, this is probably what you will use. The majority of us in situations like these that require additional cash are looking for alternatives.

You may have seen commercials like this one: a camera zooms in and out to shoot cute trucks and cars. Vehicle owners report bumper stickers that reflect their personality. Advertising images may vary, but the message is the same: If you own your car, borrow money from us. Just let us keep the title of your car as a guarantee.

Kyra Speights felt unsure when she borrowed $ 2,800 in 2012 from a payday loan company. She says it was an emergency.

Speights is a middle class woman in her forties. She has a job in the state with big benefits, but she has no savings. When her only daughter told her she was in a tough spot, Speights took action.

“She could have come stay with me if she was in Texas,” says Speghts. “She’s in college in Kentucky, her life situation was in danger. So I, as a mother, did what I needed to do for my child.”

Three years later, Speights is still making payments.

“They gave me $ 2,800 and I think I paid these people almost $ 5,000,” she says. “I haven’t even finished paying off the loan.”

She recently called to find out what her balance was. “[The clerk] said, well, just give us $ 1,100. They still have my car title, so technically they own my car. “

In a way, Speights’ car is his livelihood. If she were to repay her loan today, she would have paid 200% interest on the original loan.

Stacy Ehrlich says she’s seen worse. “We’ve seen them up to 672%.”

Ehrlich is with St. Vincent de Paul, a Catholic ministry that, in the last year or so, has begun to pay off the debts of people like Kyra Speights.

“We mainly work with a credit union,” says Ehrlich. “We guarantee and co-guarantee loans and convert high interest loans to low interest loans for credit unions. “

Currently, the credit union guarantees Saint-Vincent-de-Paul an interest rate of 2.2%.

“It’s really amazing. One of the most exciting parts is when you call someone up and say, ‘Guess what? You’ve made your last payment and you’re done. ” And [there are] lots of hugs and big woo-hoos. “

In the few months since Ehrlich did this, she bought 70 loans. Only two failed.

She sees it as a ministry. She says the state’s dioceses, from El Paso to Houston, are putting the finishing touches on their high-to-low interest conversion programs.

Martha Hernandez meets me in the lobby of Austin City Hall. She is a monitor with the city. Hernandez tells me about a few failed attempts to ban the $ 3 billion industry of payday lenders in Texas. But cities like Austin are taking the lead.

“I believe there are about 27 or 28 cities across the state of Texas that have passed ordinances that deal with the business side,” Hernandez said. “There are also ordinances that determine where these businesses can be located. “

For example, in Austin there is a limit on the number of times a loan can be renewed. Borrowers must be vetted and deemed capable of paying. If the companies don’t comply, Hernandez sues them.

Kyra Speights never knew there were options out there.

“I had no idea,” she said. “If I knew in 2012, I wouldn’t be here.”

Speights is standing, but barely. I hadn’t noticed it before, but she leans in to walk and limps a bit. She has a back injury and her right knee is sticking out of place.

“I can hear it and I can feel it – crack, bang, crack, bang – with every step I take,” she says.

Despite the difficulty, Speights takes determined action to free himself from his debts. She plans to apply for a loan from Saint-Vincent-de-Paul and hopes to qualify before her lender takes possession of her car – a crisis she says she couldn’t survive.

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