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Reasons Not to Use a Payday Advance

Avoid Payday advances

An emergency can happen to anyone, and often those emergencies require quick cash. Low-income consumers often turn to payday loans in their time of need. The truth is, however, that payday loans are a type of predatory lending that’s outlawed in many states. Are payday advances really that bad? Read on to find out.  Cost of Borrowing is High Payday loans are typically charged at a fixed-dollar fee, such as $15 per every $100 borrowed. That’s an exceptionally high rate to pay. According to the Center for Responsible Lending, the average two-week payday loan has an annual interest rate between 391 and 521 percent.  Fees Quickly Add Up If, for some reason, you’re unable to repay the loan by your next payday, the fees begin to add up quickly. How quickly? Over a two-month period, an original loan of $325 can accumulate as much as $793 in fees in addition to the original loan amount. Payday advance lenders count on the continuation of the loans, though, because it brings in a lot of cash to the tune of $3.5 billion in fees each year.  It Encourages a Cycle of Debt Those triple digit interest rates can make a bad situation ...

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