B of a mortgage : Problems of Pay Day Loans

B of a mortgage : Problems of Pay Day Loans

Everyone at some point in their life has come into some kind of financial problem. One thing that may seem tempting to fix different financial issues is taking out a pay day loan. Even though this may be something that you are considering to help get you out of debt or to pay this month's bills, you may want to take a closer look and see why pay day loans can be a problem.

First off you need to understand what a pay day loan is. A pay day loan may go by many names like a pay day advance, cash advance, or deferred deposit loans, but in the end they are all the same thing. These are short term loans that normally are supposed to be paid off by your next pay check or pay period. Lenders will normally require you to put down some kind of security for the loan like a check or pay check. Since it is a "pay day" loan, you have to give proof of employment to show you do actually have a pay day. There are no limits to what you need the loan for and you don't have to give lenders a reason why you need the loan. There is normally no credit check involved for this type of loan.

One of the main problems of these loans is their interest rate. These interest rates can be extremely high causing you to owe more than what you originally took out. Some lenders also put on extra

Need a Payday Advance? Use the Cash For Anything! Simple 1 PG Submit
B of a mortgage . You should always keep in mind that in a few months, or even next month, your "hot new item" would be last month's fad, and something else would have already taken it's place. So, there you'll go salivating again! It's a viscous cycle, and another excuse to resist taking out the payday loan. These statistics offer a similar experience generally in most other states. Which means the borrower will pay $400 - $500 in loan fees on a $400 loan. This is absurd usury and will be illegal because it is not helping anyone except the lender. It is predatory lending at best that just gets borrowers in deeper debt than before."Some will say, that little man requires somewhere to go," said state Rep. Eldridge Emory, "Butif he gets money by doing this, he's just digging an opening deeper and deeper, and he's not going to get out."Several states like Vermont have currently banned this form of predatory lending.

Relate Post