Payday Cash Advance Loans are a touchy subject in the financial industry. On one hand, they’re handy, convenient and a lifesaver (not literally, obviously) because they are easy to obtain and the cash is put into your bank account relatively quickly (in my experience we walked out with the cash, or if we applied online we had the money in our account the next day).
But on the other hand, they are a detriment to the very people that wind up needing them – people who do not have much in the way of savings (because if they did, why would they be opting for a loan?), because of the associated cost. In my experiences, I was paying 20% interest. That rate didn’t change if I borrowed $100 or $500 – either way I was paying $20 per $100. And if I wanted to extend the loan, I had to pay an extension fee that was typically 10% – 20% of the entire loan. Talk about expensive!
But, as they say, you do pay for convenience. And a payday loan is a convenience. As the article on the application process points out, in exchange for paying such high fees for the loan, the money is almost always made available to you within minutes, or at the most 24 hours. And when it comes to the reason why most people take out payday loans, time is of the essence!
What are your thoughts?
My husband and I did the ‘payday loan’ thing…and, got in way in over our head with it. In the long run… it wasn’t worth it at all. We had to pay back a lot more than what we borrowed and we were always stuck using it… it was a horrible ride and one that we were happy to finally get off of. Sure, it was handy to have at the time – but, a pain when we had to pay it off.
I haven’t tried to get a pay day loan, I already pay enough in credit cards :\