Because California has not yet passed a fiscal-year budget, all state employees are facing a cut in their paycheck. Until a budget is passed, the governor of California has asked that all paychecks for state employees be cut to the federal minimum wage. Some banks and credit unions are offering a instant money to these employees, including no-interest installment payday loans.
Resource for this article: California state employees offered low cost loan choices by Personal Money Store
Cutting employee pay in California
The state of California hadn't passed a budget when their fiscal year began on July 1. The State of California is going to be facing a $ 19.1 billion spending budget deficit if they don't pass a budget. Governor Arnold Schwarzenegger ordered that all 200,000 state employees have their wages reduced to minimum wage until a budget is passed. The state budgeting and payroll system, though, needs an overhaul and state Controller John Chiang said the reduction wouldn't be possible.
“Impasse” loans offered
Products called “budget impasse loans” that are basically no fax payday loans are being offered with no interest from Wells Fargo and Bank of America. These loans are offered for no interest and no credit check. State employees can get cash money or higher limits on their credit lines. When a state spending budget is passed, eventually, the employees will get a retroactive payment they can use to settle these loans.
Qualifying for impasse loans from banks
Employees who have to get a personal loans aren’t instantly qualifying for zero-interest loans from these banks. Instead, the state employees must already have an account with the bank or credit union. State employees have only seen a balanced budget passed on time in ten of the last thirty-four years – so it's not a surprise banks are ready.
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