Payday loans are fast cash loans which can be very expensive. Quick payday loans need to be repaid in full on your next pay day plus interest. Although there are low interest payday loans available, all still require you to repay quite a bit more than you borrow.
The payday loan industry is booming due to the high credit card debt in our society. A fast cash advance payday loan seems attractive to people until they realize just how expensive it can end up.
Payday loan cash advances can incur interest rates in the triple digits and these need to be paid in full on your next date of pay. People then get caught up in reborrowing over and over again leading to a downward spiral of debt.
It is not wise to take out a loan till payday; rather you should try and borrow money from family to pay your immediate debt. If all else fails, take a second job until you are more financially stable.
Many people who take out a payday loan will borrow repeatedly by renewing their loans with the payday loan company. This is because they are unable to afford the repayment.
Some better options for fast cash with lower fees include:
- Small personal loan
- Cash advance on credit card (still costly but as much as a payday loan)
- Loans from family
- Debt consolidation (this will lower your monthly repayments on all your debts)
Payday loans are not recommended unless you have no other option. You should see a financial advisor if your financial situation is extremely difficult and they can advise you on debt consolidation options.