Antidegradation and Nonpoint Source Pollution in the West

31 pages. Contains references

An Economic Perspective on Subprime Lending

This article aims to provide a concise economic overview of several interesting subprime financing mechanisms, which are becoming increasingly common on the U.S. financial landscape. In particular, rent-to-own, payday lending, pawn broking, and (vehicle) title loans are considered. Generally speaking, a common thread with these loans is their relatively small size and short duration as well as the absence of a credit check or any of the traditional processes for determining credit-worthiness. Due to the ready availability of these loans, they appeal to low-income consumers, including the “working poor,” and to those who have suffered financial setbacks. Because the natural clientele for such mechanisms have few or no alternatives, concern over the possibility of exploiting such consumers has lead to a continuing public policy debate over how best to help these individuals, and whether, and to what extent, regulation should play a role. By providing economic background on these subprime vehicles, this article attempts to make a contribution to this on-going debate

An Economic Investigation of Rent-to-Own Agreements

Rent-to-own (RTO) allows immediate access to goods without a credit check and provides an opportunity for eventual acquisition. Yet goods can be returned at any point without penalty or other adverse financial consequence. RTO is attractive to financially distressed consumers due to its ready availability as well as the options embedded in the contract. These options include the ability to cancel, early purchase, reinstate following a consumer return, and, possibly, choose the frequency of payments. In this article, a body of research on RTO is brought together and summarized. The bulk of this work is empirical, applying statistical techniques to examine thousands of finely detailed records of individual transactions. The primary focus is to explore the nature of the contract—for example, what is being rented, how the contract evolves over time, and what is the ultimate outcome. The intent of this exploration is a better economic understanding of the RTO financing mechanism as well as a contribution to the ongoing policy debate surrounding such subprime lending

An Economic Perspective on Subprime Lending

This article aims to provide a concise economic overview of several interesting subprime financing mechanisms, which are becoming increasingly common on the U.S. financial landscape. In particular, rent-to-own, payday lending, pawn broking, and (vehicle) title loans are considered. Generally speaking, a common thread with these loans is their relatively small size and short duration as well as the absence of a credit check or any of the traditional processes for determining credit-worthiness. Due to the ready availability of these loans, they appeal to low-income consumers, including the “working poor,” and to those who have suffered financial setbacks. Because the natural clientele for such mechanisms have few or no alternatives, concern over the possibility of exploiting such consumers has lead to a continuing public policy debate over how best to help these individuals, and whether, and to what extent, regulation should play a role. By providing economic background on these subprime vehicles, this article attempts to make a contribution to this on-going debate

Antidegradation and Nonpoint Source Pollution in the West

31 pages. Contains references

Oil, the economy, and monetary policy

An examination of the theoretical impact of an oil shortage on the U.S. economy and the problems that such shortages present for monetary policy.Power resources - Prices ; Monetary policy

Rent-To-Own Agreements: Purchases Or Rentals?

The rent-to-own (RTO) business has emerged as an important component of the retailing sector. By offering immediate access to household goods for a small periodic fee without a credit check or down payment, RTO has strong appeal to low income and financially distressed consumers.  A common perception of RTO is that they are disguised, high-interest installment agreements as most consumers eventually acquire the contracted merchandise by making all scheduled payments. We examine the nature of these agreements by using a unique data set of more than 350 thousand transactions drawn from 100 RTO stores in 46 states. Our main result, derived from an analysis of disposition and duration, is that RTO agreements are more frequently used for short-term needs rather than as a method of acquisition.  Legislative and legal efforts to classify RTO agreements as primarily installment contracts cannot be justified by their pattern of use in the marketplace.&nbsp

Evaluating Options For The Regulation Of Payday Loans

This study discusses regulatory options that federal and state legislatures might consider for the payday loan industry. These options include outright prohibition; restricting the implicit annual percentage interest rate; limiting the amount per loan; limiting the number of concurrent loans; setting lower and upper limits on contract length; and defining the waiting period between loans. While other studies examining the payday loan industry have relied on user survey data or data from a specific lender, this study utilizes data collected by the administrative agent for all payday loan activity in several states, including Florida, Illinois, and Oklahoma. A comparison of key empirical results derived from the differing regulatory environments in these states provides guidance to those who consider imposing further regulation. The current regulatory constraints have resulted in a relatively low default rate, a high rate of loan denial, and a troubling industry reliance on the frequent borrower. An analytical framework is suggested for understanding the motivations of the low and high frequency borrowers