Montel Williams Backing Pay Day Loan Site Money Mutual? Interesting...

I have interacted with Montel Williams a couple of times on his radio show, 'Montel Across America.' I didn't like the show very much, to be honest, because Montel seems to enjoy hearing himself talk more than his guests. But then again, I figured that he is just now learning the hard knocks of radio life, where you actually have to allow other people to talk. No disrespect to Montel of course, he's accomplished a lot.

But when I received an email telling me that Montel is now doing commercials for Money Mutual, a company that offers short-term loans with no credit check, I found that to be quite interesting.

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Dirty Credit Card Tricks

Say "Bye-Bye" to Your Grace Period
No grace period means that you'll start accruing interest the moment you charge something and that can cost you a bundle of "extra" interest. Most credit card issuers have already reduced their grace period from 25 days to 20 days. Many others have eliminated the grace period altogether. Now they are coming up with more and more reasons to take away your grace period. Miss a payment? Stop carrying a balance? Bye-bye grace period!

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Dirty Credit Card Tricks

Punishing You for Being Smart
These fees are the lowest of the low because they penalize you for being a responsible credit card user. Some of the biggest offenders include charging you a fee for:
+ Closing your account
+ Failing to use a card for a period of time (such as six months or a year)
+ Not carrying a balance
+ Every transaction each and every time that you use your card
If your card charges you any of these fees, it's time to look for a new card!

Dirty Credit Card Tricks

Lowering Your Minimum Payment
Another way some cards try to jack up their profits and lure you deeper into debt is by lowering the minimum payment due on your balance. It used to be cards required a minimum monthly payment of about 4% of your balance, but many now require as little at 2%. Don't fall for it! Going from a $40 payment to a $25 payment on a $2,500 balance means it will take you an extra 19 months to pay off your balance!

Dirty Credit Card Tricks

Inviting You to Skip a Payment
Broke this month? In their infinite generosity (ha!), some cards will "invite" you to skip a payment. This "helpful" offer, which sounds great at first blush, often comes after the holidays when your balance is big and your wallet is stretched. DON'T DO IT! Skipping that payment can lead to a host of trouble from a higher interest rate to possibly having to make extra payments in the future. Are you starting to notice a pattern?! You should be skeptical whenever your credit card company does something "nice" for you without you asking for it!

Dirty Credit Card Tricks

Tricky Timing
We all know that our payment is due on a certain date or it's late, right? But a new twist being thrown into the mix is having your payment due by a certain time on the due date. If your payment is due at noon, and gets processed at 12:01, you get socked with a late fee AND likely a higher interest rate. Gimme a break! Carefully check your statement so you avoid this trap.

SOURCE: Dirty Credit Card Tricks provided by AOL Money & Finance

Dirty Credit Card Tricks

No, Montel is not a crook. And neither are Magic Johnson and Russell Simmons, two other people who have loaned their names to companies (Rent-a-Center and The Rush Card) that want to give us access to capital. Instead, they are pure, hardcore capitalists: individuals who are willing to endorse the idea of charging you a very high price to give you something you very desperately need. Many people in America right now are cash poor: they don't have bank accounts, or their financial literacy is low and they have trouble making it from paycheck to paycheck. Then Russell, Magic and Montel come along touting products that help people to solve their problems, the same way that a Good Samaritan offers a thirsty man a drink.

The challenge, however, is that one has to wonder if it is right to offer the thirsty man a drink for $50 dollars? Should we take advantage of the fact that he needs water in order to live or does that make us exploitative? All the while, even if we charge the man $50 dollars for his drink, we can still argue that we are helping him out. That is the dilemma of payday loan companies and those who endorse them: they charge incredibly high interest rates to people who really need the money and may not necessarily be able to understand the fine print.

Magic Johnson, Montel Williams and Russell Simmons can sell these products mainly because they are brown skinned, easily-recognized figures in urban America. Let's be clear: they are selling these products to people who are often poor and Latino or black. Increasingly members of all communities are in need of such expensive loan products. Should we be offended by their actions and activities? It depends on where you stand.

Personally, I'd like to see another brown-skinned person get involved: Barack Obama. President Obama, in the midst of his quest for stronger consumer protection laws, should create competition for companies that are accused of imposing usurious interest rates on the poor in exchange for helping them receive basic banking and access to capital. He should impose stronger laws to keep companies from earning a profit that exceeds that which should be earned in a competitive market. He should support programs to increase financial literacy within urban communities and nation-wide, so that consumers know they have a choice.

It's OK for these guys to go out and make their money, but unregulated capitalism in poor communities is almost never a good thing. Perhaps their collective conscience will kick in and get them to reconsider, but I seriously doubt that will happen. That's why President Obama needs to step in.