Debtor's Diary
  • Home
  • Blog
  • Community
  • About
  • Contact

The Payday Loan crunch!

4/8/2017

5 Comments

 
​Yes, that is the root of my debt at present time, Payday Loans. Oh how evil they are. The state in which I reside allows Payday Lenders to register and operate legally. There are as many Payday Loan stores in any given city in my state as there are StarBucks, or McDonalds. It is a crying shame because they do a very thriving business at the expense of people like me, the consumer.

Here is an eye opener for anyone who has not had a Payday Loan.  You can go to one lender and get the limit in my state, a loan of $1,000.  This is a pay day loan, a draw against your next check.  Keep that in mind.  Because you can then go to the next lender three doors down, and get another max loan of $1,000!  Against that very same pay check!  Yep, that is right.  These stores have license to lend the max amount without checking your credit and on your good word alone that you can pay them back.  I’m sure you can imagine what a mess this could turn out to be.  An average consumer can pretty much get a draw way over and beyond what they actually bring home in their net pay.  Hey, it really happens too.  Sadly enough.

So, ok, you now have two $1,000 loans with terms of a finance fee averaging around $200 each, so payback due for a whopping total amount of $2,400 by next pay day.  Yikes, what a mess you are in now.  Your option, roll-over.  Yes, these companies are allowed to extend you the courtesy of paying the finance fee only, instead of paying back the loan in full.  And you can do this three times in my state.  Therefore, by re-financing these loans three times, and then paying them off on the fourth month, you would end up paying in total: $3,600!!!  Now, if that isn’t a fantastic business deal for the Payday Lenders!  And for the consumer, well, they have really taken one in the shorts!

Now, one other option you have when re-financing these loans is to pay additional money toward the principal to buy down the final pay-off.  So, say you put $300 toward the loan with the first re-finance.  $200 goes to finance fees, $100 reduces the loan.  You then owe $900 and have a reduced finance fee the next time, lets say $180.   With your next payment, you can pay $280, reduce the principal to $800 with a re-finance fee of $160.  Again, the next time, you pay $260, reducing principal to $700 and finance fee of $140. Then when your final payment is due, you owe $840 to pay it off.  With this option you end up paying a total of $3,360 for the two loans, you saved a whole $240 overall.  Whew.

I think you get the idea of how bad an idea it is to take a payday loan, or two, to get you through a financial crisis.  Its a really bad idea!  Believe me, I’m in the midst of being way over my head in Payday loans, and I don’t see and end to it in the near future at least.  I just keep plugging away, re-financing, re-loaning, getting deeper and deeper into the crunch.
​
I need a ladder, to climb out of this hole!
5 Comments
visit website link
2/9/2018 10:50:26 pm

Just because you have bad credit does not mean you cannot land an installment or long-term loan. In these economically difficult times, lenders are willing to work with bad credit borrowers.

Reply
http://www.slickcashloan.com/ link
2/9/2018 10:50:44 pm

When you need a long-term installment loan but you have bad credit, it can be challenging to find someone who is willing to extend a loan. However, if you have verifiable income, it is possible to find long term loans for bad credit. The most important thing to remember is to be patient with the process, and always look for the loan company or lender that offers you not only the best interest rate but who can provide you with the best quality customer service.

Reply
money lender Singapore link
3/11/2018 05:40:10 am

House rehabbers often seek funding from hard money lenders to finance their deals. Also known as private lenders, these financiers make sure that you can proceed with your real estate investing deal even if you are short in personal money.

Reply
getting a business loan link
5/19/2018 01:00:51 pm

Business loans to small businesses are not hard to get if you understand how to get them. Lending standards have not tightened; they are just back to where they are supposed to be. Find out why.

Reply
slickcashloan.com link
11/16/2018 07:45:22 am

Let's start with the basics, what is a car title loan? A car title loan is a type of financial service where the borrower receives an investment from the car title loan company.

Reply



Leave a Reply.

    Author

    Write something about yourself. No need to be fancy, just an overview.

    Archives

    June 2017
    April 2017

    Categories

    All
    Debt Management
    PayDay Loans
    Peer Lending
    Personal Finance
    Relationships

    RSS Feed

Proudly powered by Weebly
  • Home
  • Blog
  • Community
  • About
  • Contact