Payday loans can be a great benefit if used properly. The problem is, that is hardly ever the case. The problem lies in that fact that if you don’t have the money today, how will you have it in two weeks to pay off the loan? Sure it comes out of your check, but will you have enough left over to live on? The payday loan company gets first dibs on your paycheck and if you don’t have enough left to pay the bills and buy food, you will probably head back to the payday loan store and get another loan until your next payday and the cycle is set until you can come up with enough cash to pay the loan off without it having to come from your paycheck. In the mean time, you are paying a hefty fee each time you take out the loan.
Since the rise of payday loans, more and more payday loan stores came to emerge. Each payday loan store bears a payday loan offer distinct to the other, but in some sense, all of them share the same goal and that is to provide the people access to small and short term payday loans.
Several payday loan stores are operating today. In fact, finding out a payday loan store is not so difficult. They can even be found on the web and they can be located anywhere in the world. Many have believed that a payday loan store can help them get the cash they need for whatever emergency needs they may have. Yes, this is true. The payday loan stores can indeed assist you in obtaining cash fast when you need it the most. But, are the payday loans that the payday loan stores offer the ultimate way to obtain money fast?
According to the payday loan propaganda, everybody needs a payday loan. Payday loans are quick, no hassle way for consumers to secure small, emergency loans, with little or no red tape. Most of the payday loan stores even claimed that payday loans serve an under-served market because neither consumer finance companies nor banks are interested in originating $100 to $500 non-secured loans.
Don’t fall for the slick advertising. A payday loan should only be considered in a dire emergency because the risk is so great of it triggering future financial difficulties.
To some degree, payday loans are indeed quick and hassle free. All you need to do is to write a check to the payday loan store indicating the amount you want to borrow along with the fee. Then, you will just post-date the check to the period or date of your next payday. After this, the payday loan store will then provide you cash for the payday loan amount. But apart from this, you actually have certain options. You may agree to either bring in the cash in advance for your check or even allow the payday loan store to automatically deduct your bank account on your next payday.
With such nature of agreement between the payday loan customer and the payday loan store, several experts and customers have considered some problems with it. It is first claimed that the fee you actually pay for the use the money is extremely high. Well, you can think it this way: by borrowing your pay in advance, you are essentially settling for a 15 percent cut in the pay. In addition, you must note that if you can’t make it through to the next payday without a loan, and you are already spending the next week’s pay, can you ever make it through next week without another loan? The payday loans cycle in this sense can be very vicious and expensive, right?
Also note that in some states like Arizona, it is considered a fraud to knowingly write a bad check. What does this mean? This means that on the off chance that you don’t reclaim your check on the agreed period of time; the payday loan store will actually deposit it anyway. It is somewhat interesting to know that bad check laws in several states generally allow the payday loan store to take you to civil court for three times the amount of the check along with the court fees. And, if your check bounces, the payday loan store will automatically charge you an NSF fee which is commonly up to $30. That is basically how the payday loan store offer and maintain your loan.
If you have no other choice, then getting a payday loan can be a godsend if it gets you through a tight spot. Just be fully aware of what you are getting into so you don’t get started on a cycle that gets you trapped. Come up with a plan to get the load paid back and still have enough cash left over so you can make it without having to make a trip back to the payday loan store for another loan.
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