More than a century ago, Alabama enshrined a basic protection in the state’s constitution shielding its poorest citizens from being forced to pay debts they couldn’t afford. But a public hospital in the mostly rural southeast corner of the state has found a way around the law.
USA Discounters, the Virginia-based retailer at the center of a ProPublica investigation in July, says it has made reforms to its lending practices to service members. But instead of overhauling its policies, the company has simply adopted a new name for its stores, USA Living, and continues to make loans much the way it did before.
One in 10 working Americans between the ages of 35 and 44 are getting their wages garnished. That means their pay is being docked -- often over an old credit card debt, medical bill or student loan.
High-cost lenders -- the makers of payday, auto-title and installment loans -- exploit laws tipped in their favor to sue tens of thousands of Americans every year. The shocking result? A $1,000 loan grows to $40,000.