Quick Cash Loans are Bad News!

I can tell you right now with this post, I won’t be making any friends in the quick cash industry. But that’s ok because this is an industry that preys upon people who are in the middle of a financial crisis. According to the Community Financial Services Association of America, about 19 million Americans use payday loans each year. This is out of control!

Let’s be real honest. Things happen in our life that cost real money and when we don’t have a plan, we panic! Let’s say the car broke down, now we have a car problem and we have a money problem. The mechanic says it will be $400 to fix th car.  You don’t have $400 and you don’t get paid until next Friday. You need the car to go to work, if you don’t go to work then you will get fired and then you will have bigger money problems. So you head to the quick cash store right? Wrong! 

The average fee is around $15 per $100 borrowed, if you read the fine print, most loans must be paid back in 14 days or they add the fee again and again until the loan is paid in full.  So let’s say you borrowed $400 to get the car fixed. You would repay $460 if you were able to pay it back in 14 days. Here is the problem; unless you were going to fix the car when you got paid anyway, you probably can’t pull $400 out of your next check without making another bill wait. If you make a bill wait then you could wind up paying late fees on that bill or maybe even risk having that service shut off.

In most of the loan contracts, you give the quick cash lender permission to automatically debit your account on the agreed upon day.If you don’t have the funds available you will start racking up the fees with your financial institution. Add those fees to the late fees from the bill you did not pay and the fees you paid to borrow the money and when it is all said and done you will wind up paying annualized interest rate somewhere between 400% and 600%. Does it still seem like a good idea to use a quick cash loan to fix the car? I hope not! Swallow your pride and ask a co-worker or a friend to drive you.

Over the past few years, I have heard a lot of reasons for taking out a quick cash loan. Many of the reasons are not even to cover an emergency. People do stupid things with money and I am no exception, over the years I have made some pretty dumb mistakes but let me say there is NO good reason to borrow money from one of these places.

If you have or are currently borrowing from this type of lender, call us today. We want to help you create a spending plan that allows you to save for emergencies. Our first session is always free, but until April 20, 2013, we will give you the second session free too! Don’t wait call today! 800 698 0333 ext. 1.