Addicted to Loans - Payday Advance Loan

Payday Advance Loan

The greatest problem facing consumers in the fight for a better payday advance loan is their own sad ignorance - people just don't know enough. For instance:

40% of borrowers believe their payday loan rates are less than 30% APR. If you were given a fast payday loan with a fee of $15 per $100 borrowed and rolled that loan over for a single term and paid the $15 roll over fee, your payday advance would have a 30% rate - for a single month! Multiply that by 12 months (360% APR) and you begin to see just how expensive the payday advance loan really is.

So many people, even more payday advance loans

Only 1% of all payday advances are taken out by one-time, emergency borrowers who pay off their payday advance loan on time and in full and don't take out another within a year. Thats one out of a hundred among us using the payday advance as it was initially designed - an emergency cash resource for the times when a financial injection is absolutely necessary. For the rest of us, we either roll over our loans ( 80%) or take out an average of 5 payday advance loan opportunities each year (91%). Either people are being forced into these situations that are known to be so bad or we aren't aware of all the dangers facing all of us in a payday advance.

The real dangers of a payday advance loan

The first danger you automatically face is paying money for money - that is not opportune. The instant fee you will be charged for a payday advance loan is at least 15% of the amount you take out. But this money isn't being given to you, its being advanced - the money is technically yours. Thats the first problem. The second danger is what happens when you payday actually comes - chances are you will not want to part with it. Lenders provide roll-over programs so you can keep your money for as long as you want it, just so long as you keep paying them their roll-over fees each and every payday until your payday advance loan is repaid in full. For a $300 advance thats about $50 every paycheck - just to keep the loan active. Missing a single payment will ruin your credit and will have the lenders crawling all over you. Even after you finally repay your debt you are still faced with danger - the money you saved and financial sacrifices you made to pay off your advance will leave you in the hole, and chances are you will come back to the payday advance to meet your financial obligations once again.

Lights at the end of your payday tunnel

But there is hope, there is hope for everyone and their payday advance loans addiction. And that hope - friends - is in your tenacity, your ability to create a financial safety net on your own that will guarantee against the need for payday advances in the future, and that net is a savings account. Save only a little, a few hundred dollars is all you need, and you'll never need rely on someone else's fast, ready, expensive payday cash loan ever again. Hooray!