Shortchanged: Life and Debt in the Fringe Economy“An eye-opening read in the school of Barbara Ehrenreich’s Nickel & Dimed . . . shines a bright light on the economy’s darker side.” —Publishers Weekly (starred review) Drive through a low-income neighborhood and you’re likely to see streets lined with pawnshops, check cashers, rent-to-own stores, payday and tax refund lenders, auto title pawns, and buy-here-pay-here used car lots. We’re awash in “alternative financial services” directed at the poor and those with credit problems. Howard Karger describes this world as an economic Wild West, where just about any financial scheme that’s not patently illegal is tolerated. Taking a hard look at this fringe economy, Karger shows that what seem to be small, independent storefront operations are actually part of a fully-formed parallel economy dominated by a handful of well-financed corporations, subject to little or no oversight, with increasingly strong ties to mainstream financial institutions. It is a hidden world, Karger writes, where a customer’s economic fate is sealed with a handshake, a smile, and a stack of fine print documents that would befuddle many attorneys. Filled with heartbreaking stories of real people trapped in perpetual debt, Shortchanged exposes the deceptive practices that allow these businesses to prey on people when they are most vulnerable. Karger reveals the many ways this industry has run amok, ruining countless people’s lives, and shows that it’s not just the poor but, more and more, maxed-out middle class consumers who fall prey to these devious schemes. Balancing compassion with a realistic awareness of the risks any business faces in working with an economically distressed clientele, Karger details hard-headed, practical recommendations for reforming this predatory industry. |
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ACE Cash Express auto insurers auto title average balance bankruptcy BHPH bill borrowers cardholders Carlotta Cash America CCAs CCIs Center charges check cashers check-cashing corporations cost credit card debt credit counseling credit counseling agencies credit history credit scores credit unions creditors customers dealers earned EITC example Federal Reserve filing financial services foreclosure franchised fringe auto fringe economy H&R Block high interest home buyers home equity homeowners households Ibid income interest rates Jackson Hewitt late fees loan terms middle class million month monthly payments mortgage National nonprofit offer option paid pawnshops payday lenders payday loans poor predatory lending profit purchase refinancing regulators rent Rent-A-Center rent-to-own rental repay require retail revenues sector secured sell subprime lenders subprime loans tax preparation tax refund there’s Title Loans transactions unbanked usury usury laws vehicle Visa Wal-Mart