Payday loans were initially developed to solve the growing problem of getting folks in financial jams the money they needed fast. However, in recent years, payday loans have been called a scam that exploits those in need by trapping them in an unending cycle of debt.
Unfortunately,payday loans can be a cycle of debt if not used responsibly. To make sure you're not a victim to payday loans, follow these tips.
Payday loans are one of the easiest ways to get quick cash. But just because it's the easiest way, doesn't make it the best way. When you find yourself strapped for cash, ask yourself if you really need the money to pay for an essential item or service or do you want the money for something that you can do without. If it's not a necessity, then you should probably not take out a payday loan.
Payday loans come with a very high APR. If you can't repay the loan by your next payday, you can start incurring additional fees to extend the life of the loan which will increase the amount you owe on the loan and create a never-ending cycle of debt.
Think of payday loans as the last resort for when you really need some extra cash. Typical payday loan borrowers normally take out a loan because they have an unexpected illness in the family, a car repair or some other incident that can have serious implications if they don't get extra cash right away.
Often times when borrowers get a payday loan, it's done either over the phone or online. Because there's no one there to physically point out important information in the loan agreement, borrowers tend to hear only certain details, like the amount they’re getting, while they block out the really important stuff like the amount they have to repay. To avoid being blindsided on your next payday with a huge debit from your account, be sure to review your loan agreement carefully and budget your monthly expenses with the repayment amount in mind.
If your monthly salary is over the required threshold set by these payday loan companies, you may be offered a higher loan amount than you were initially seeking. Often times, we're more inclined to take the higher amount thinking "the more the merrier"-- but that's not always the case with payday loans. By taking the higher amount, you may be putting yourself in more debt than you need be.
When applying for any loan, be sure to have a clear plan in mind that details the exact amount you need and how much cash flow you have available to repay the loan on time to avoid additional fees and interest.
Get a payday loan alternative of up to $1,250 in your account as soon as the next business day from MaxLend. Apply now.