A non-profit financial group has a plan to help more Rhode Islanders buy cars. State leaders say the service fills a much needed gap.
Before she got her new vehicle, Cranston resident Shirlie Martinez said she and her young daughter worried every day about her 19-year-old car.
“It would be nerve-racking in the morning to know, well, maybe my car won’t start, therefore I can’t go to work, and she can’t go to school.”
Martinez didn’t have strong enough credit for banks, or credit unions, and she feared services like Pay Day lenders, which give quick money but often at very high interest rates.
The Capital Good Fund will offer loans of up to $13,000 to low-income Rhode Islanders trying to buy new vehicles. The nonprofit will provide the loans to households making at least $1,500 a month.
State Treasurer Seth Magaziner, who supports the program, says the service provides an alternative to things like payday lending, a practice he calls predatory.
“Too many Rhode Islanders, working Rhode Islanders, have to rely on predatory financial services that charge an exorbitant rate and trap people in a cycle of debt.”
Pay-day lenders have said that they provide an important service to people in emergency situations.
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