The document discusses title loans and their impact on the urban economy. While title loans can help cover emergencies and expenses between paychecks, they often have high approval rates with minimal qualifications. This can lead borrowers into cycles of debt if loans are unaffordable. To improve the situation, regulations aim to require lenders to evaluate borrowers' ability to repay and offer affordable payment plans rather than blocking alternatives entirely. When borrowing and spending are cyclical rather than alleviating finances, it burdens the urban economy instead of supporting local businesses and economic sustainability at a community level.

1. Loans For Less
3396 S 300 W, Salt Lake City, Utah 84115
(801) 485-9585
Borrow and Spend: On
Title Loans and the Urban
Economy

2. Title loans or personal loans have many uses. Emergencies, medical expenses, payment
for rent and utilities, unemployment, and funeral costs are some of the urgent matters
that can make use of a title loan. It is a way out for many Americans, especially those
living in between paychecks.
The issue with the loans, though, is the approval. While particular financial institutions
and banks have stringent loan approval processes, there are lenders that provide barely
any qualifications for approval. This is why the Consumer Financial Protection Bureau
(CFPB) raises its concern – the organization proposed a rule requiring payday and car
title lenders to first assess the repayment capabilities of a borrower.
Despite the many uses of a loan, it will only damage the urban economy if it remains to
burden consumers instead of alleviating their finances. The large global firms cannot
continue to produce and maintain long-term and life-satisfying jobs, which places the
responsibility for economic sustainability in the hands of local businesses. When
borrowing and spending turn cyclical, an economy has to address inequality and poverty
on a smaller scale.

3. Looking at the World’s Wealth
Statistics present the facts: the richest one percent of the world has an immense
amount of wealth that, at present, is equal to the combined wealth of the residual 99
percent. This is a definitive trait of inequality and the reason for poverty’s existence. In
many ways, this translates to the current state of the working class – the lives enabled
by borrowing and spending.
As an example, the hunger that populations experience is a manifestation of poverty,
not the lack of food production. The world is working at a pace that it can churn out
enough food to feed the entire population. The problem is that the unfortunate do not
have sufficient buying power to deal with their hunger.

4. Sources:
 http://easytitleloansutah.com/
 http://www.sltrib.com/opinion/4062774-155/washington-post-op-ed-think-theres-no
 http://www.worldpolicy.org/blog/2016/12/27/strategies-urban-economies
Affordable Payment Plans
There are over 90 million Americans living in states that don’t practice payday lending.
This results in the mushrooming of alternative lenders, which creates a debt cycle when
borrowers find themselves too deep in several loans to repay any of them at a given
point in time.
The CFPB’s proposed rule does not serve to block the alternatives. As a way to improve
the urban economy, its purpose is to prevent abuse and push lenders to create loans
with affordable payment plans.