Easy PaydayLoans : Get out of Debt : Behind the
Hype
You can’t watch late-night TV without seeing ads for
them. They may be
called different things, like PaydayLoans, signature loans, cash
advances, or payday loans, but they all mean the same thing. You will get cash in a
hurry, and for the privilege, you'll be socked with an outrageous
interest rate.
Millions of people are now feeling financially
stressed, and sometimes can’t stretch their incomes from paycheck to
paycheck, because some bills won’t wait. So they turn to payday loans
to tide them over, and begin an ever-steeper decline into
unmanageable debt. Why do they do it?
Paydayloans are available to anyone regardless
of his or her credit rating they are easy to obtain. They offer
nearly instant approval, of between one and twenty minutes, and the
money will be in the borrower's bank account the next day. Throw in the fact that
payday loans are free of up-front costs, and available not only at
walk-in loan offices but over the Internet or phone, and it's easy
to see why payday loans are so appealing.
But behind the appeal lurks an entirely
different story.
Suppose you borrow $200 for two weeks, agreeing to pay back
$230. You're paying 15
% in interest over fourteen days, more than 1 % a day, or a greater
than 365% annual percentage rate. Even the worst credit card
companies seldom charge more than 29.9% APRs!
If you can’t pay the loan back when due,
you'll be hit with rollover and late fees, also racking up 1% per
day, and making it even harder to pay the loan off when the next tow
weeks are up.
Never take out a payday loan for an amount larger than you
know you can pay off with interest by the due date. It's the only way to ensure
that you don't mortgage your future to the paydayloan
companies!