This Lender Said Its Loans Would Help Tennesseans. It Has Sued More Than 110,000 of Them.

ProPublica’s Local Reporting Network collaborated with the Tennessee Lookout to create this article. You can subscribe to Dispatches for immediate access to stories like this one upon publication.
The focus continues to be on flex loans. Have you been taken to court by Advance Financial, Harpeth Financial, or another flex loan provider? If so, reach out to reporter Adam Friedman at 615-249-8509 to share your story.

Key Points of the Report

– Lawsuit Surge: Since the inception of Flex Loans in 2015, Advance Financial, a Tennessee-based lender, has filed over 110,000 lawsuits against borrowers.
– High Costs and Charges: Flex Loans allow borrowers to access up to $4,000 at 279.5% interest, leading many individuals into debt that results in legal action.
– Avoiding Federal Oversight: Advance Financial influenced legislators to introduce the new Flex Loan to escape federal consumer protection regulations.

Rosita Hansen found herself in a legal battle with Advance Financial after taking out a loan to save her home. The loan, which started at $2,050, eventually spiraled into a debt of over $12,500 due to high-interest rates. Like many others, Hansen struggled to afford legal representation and faced challenges in negotiating payment plans with Advance.
Advance Financial has initiated more than 110,000 lawsuits in Tennessee since the introduction of Flex Loans in 2015, surpassing other payday lenders. The company’s aggressive litigious approach has affected many Tennesseans, including those in low-income areas.
The Flex Loan, created by Advance Financial, allows for larger loan amounts with significantly higher interest rates compared to traditional payday loans. This has led to a cycle of debt for many borrowers, with court judgments often resulting in garnished wages and substantial additional fees.
While Advance Financial has argued that Flex Loans offer cheaper options than payday loans, critics claim these loans target vulnerable populations, trapping them in unmanageable debt.
Other states have taken action to regulate similar lending products following issues experienced in Tennessee. For instance, Virginia and California passed legislation to cap interest rates on open-ended lines of credit after facing challenges with lenders like Advance Financial.
Advance Financial declined to address specific questions about its operations but highlighted positive feedback from most customers. Despite this, numerous legal cases and stories of financial hardship paint a concerning picture of the impact of Flex Loans on Tennesseans.
If you have faced difficulties repaying a flex loan or have been sued by a flex loan lender, share your experience with reporters investigating this issue by contacting Adam Friedman at 615-249-8509.