PALS or just payday loans

Payday Alternative Loans or PALs are a buzz word in the credit union industry.

Some credit unions are advertising a 0% APR on their PALs, but charging a 20% documentation fee.

“The 20% fee does not accurately reflect the costs of processing applications so the fee should be considered a finance charge under Reg Z and be included in calculating the APR. This would raise the APR above the 18% ceiling,” the agency wrote.

If this proves anything, it’s that you can’t make money below 36%. Read more at Credit Union Times.

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