There are many myths surrounding Pay Day Loans that must be debunked because of how they discourage those in a financial bind from seeking relief.
You know you need to explore pay day loans when you are met with a financial situation that you cannot rectify without money. Payday is still days, a week, or even two weeks away and you have already spent almost everything you have on bills. There is absolutely no way you can take care of your emergency situation without doing the embarrassing thing of asking a friend or family member or money. Then again, your friends and family members may be in binds of their own, leaving you with no one to ask.
This is a scenario that many individuals face and they hesitate when it comes to looking at pay day loans because they have heard bad things about them. That is why it is very important to debunk the myths of Pay Day Loans. Here are a few of those myths and the facts that prove them wrong:
• The interest rates are criminally high: The interest rate is more or less a fee for having this short-term loan and it is how the lender gets paid. These loans are legal in almost all 50 states and the average fee for every $100 is around $15-$20.
• They’re a trap: Pay day loans are not designed to be traps due to the fact that payment is due when the borrower gets paid. The borrower is in complete control, such as not borrowing the maximum amount of the paycheck so that there is money left after the loan is paid back.
• Taking advantage of the disadvantaged: Most pay day borrowers are not poor. A majority is also younger than 45 years old, so no one is taking advantage of the old. High school and college graduates borrow for various reasons (Education Expenses), more married couples borrow than single parents, and everyone who borrows must have a job. This means that the unemployed isn’t being taken advantage of.
Pay day loans are simply bridge loans that help responsible people make it through to their next paycheck. People do not take out these loans just for the sake of having “Extra Cash” because the money has to be paid back. Borrowed amounts typically do not exceed $1,000 and those 18 years and older who are employed pay the loan back through an electronic debit from their bank account on the day that they get paid. This is a very simple process that any adult who has a job, regardless of credit status, can take advantage of.
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Pay Day Loans