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February 21, 2007 05:00 PM

Clearing Up Payday Loan Legislation

Wednesday, lawmakers in Pierre tried to clear up some confusion over a law that puts restrictions on payday loan shops. 

Legislators thought they had limited the amount of money people can borrow, but a technicality is allowing some to skirt the law. 

The bright signs say you can get cash fast... but credit counselors warn the fees and interest you'll pay loan companies will only hurt your finances. 

Lawmakers passed a bill a couple years ago, saying one person could only borrow $500 at a time, from any one company. But an audit showed people were getting several $500 loans at the same time, from the same loan shops. 

Businesses said they thought the limit was only on the amount... and not on how many loans they could give out. 

Counselors say clearing up the language would keep people from owing too much money at once. They also say if you're using payday loans to manage your finances, you're probably in worse trouble than you think. 

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