Have you found yourself in need of funds, but burned out by payday loans with crazy interest rates? Do you live in Northern Kansas? The Kansas Loan Pool Project (KLPP) may be able to help you!
What is the Kansas Loan Pool Project?
The Kansas Loan Pool Project is part of the Catholic Charities. The program was started in 2013 in response to increasing numbers of Northern Kansas citizens being trapped in a debt cycle after receiving loans from predatory lenders.
By their first anniversary, the Kansas Loan Pool Project had issued 62 loans that eliminated 95 payday and title loans!
What are predatory lenders?
Did you know that in 2017, Kansas held a record of having almost three times the number of payday loan businesses than McDonald’s restaurants?
The type of loans that the Kansas Loan Pool Project hopes to help with are from lenders who charge very high interest rates and fees. Many borrowers have been facing interest rates of over 500%, and some online lenders have charged over 1000%! This often means that the interest and fees quickly add up to more than the original loan and borrowers can find themselves paying an endless cycle of payments that don’t even reduce the original amount of the loan!
Some of these predatory lenders are not even registered for business and may employ threatening tactics to collect payments. The Kansas Loan Pool Project hopes to help people avoid these companies altogether!
How does the Kansas Loan Pool Project help borrowers?
The Kansas Loan Pool Project has partnered with the Sunflower Bank for a collaborative loan program! For qualified applicants, they are able to pay off the original high-interest loan and replace it with a 6% interest loan through the Sunflower Bank.
This can cut the length and amounts of the payments considerably and allow borrowers to pay off the loan and work toward financial independence!
What kind of loans can the Kansas Loan Pool Project help repay?
We all know about cash advances and payday loans – quick cash loans to get us from one paycheck to the next. When a borrower is not able to repay the loan within the specified time frame, many of them sign to “roll over” the loan or “re-loan” – with even MORE fees! These loans can reach nearly 400% interest – making them difficult to repay.
Many times an emergency can also prompt us to look for a way to get quick funds. These emergencies can make it easier for some borrowers to be convinced to sign a title loan.
In many cases, an emergency car repair loan ends up with a borrower signing the vehicle’s title as collateral. These title loans frequently are up to an average of 260% interest! Often the interest and fees can end up totaling more than the title is worth, leaving a borrower trapped and unable to pay off the loan.
How do I qualify for help from the Kansas Loan Pool Project?
The Kansas Loan Pool Project serves citizens from 31 counties across Northern Kansas. Qualified applicants cannot owe more than $2,500 in short-term high-interest loans. If the total owed is more than $2,500, applicants may be considered once they bring the balance to meet that maximum.
Applicants must have verifiable income and work with one of the budget advisors with the Kansas Loan Pool Project for monthly counseling.
How much can the Kansas Loan Pool Project help with?
Qualified applicants may be able to have their high-interest loans repaid up to $2,500. The loans are financed through the Sunflower Bank at 6% interest. Most loans average between six to 24 months repayment plans.
What if I don’t have a loan but need one?
A pilot program of the Kansas Loan Pool Project includes relief loans! These are for crisis loans up to $1,800 for emergency needs for qualified applicants. This is to prevent borrowers from having to approach predatory lenders to begin with. Applicants for these loans also need to have verifiable income as well as receive monthly budget counseling.
How do I apply for Kansas Loan Pool Project help?
The Kansas Loan Pool Project has more information on their site and a downloadable application.
Their Director of Stabilization & Outreach Services may be reached at 785-825-0208 x 207 or [email protected]. Their Stabilization Services Specialist may be reached at [email protected].
What do I have to submit with a Kansas Loan Pool Project application?
Documents that are required to be submitted with the application include:
- Completed loan application
- Proof of income for one month prior to application (paystub, sealed letter from employer)
- Recent bill (utility, rent, etc.) with current address
- Recent document for loan(s) with current balance
- Driver’s license or ID
- Social Security card
- Proof of Social Security of SSI income
- Copy of voided check or deposit slip to establish automatic loan payments
These documents are needed for both persons if the applicant is married.
What else is Kansas Loan Pool Project doing to protect against predatory lenders?
The Kansas Loan Pool Project has been involved with the Kansas for Payday Loan Reform Coalition. They have testified in support of proposed bills that would limit interest rates charged by predatory lenders as well as enforcing requirements for lenders to do due diligence in performing credit checks regarding other outstanding debt before lending. This could help keep borrowers from being overwhelmed with excessive interest and fees!
What else does Catholic Charities help with?
The Kansas Loan Pool Project is only one of the Catholic Charities programs that are intended to help those they serve achieve financial stability! Many Catholic Charities locations also run food pantries, offer housing assistance, provide pregnancy and adoption services, and supply disaster relief.
What if I need more help?
For more resources for cash assistance, we have loads of information for you!
Rachel Grayless
After 27 years in law enforcement and state Veterans Affairs agencies, I found myself working from home and looking for dollar-stretching resources. Government programs can be notoriously difficult to navigate and I'm happy to lend my experiences to make this easier for others!