Payday loans

Every place I go, whether for shopping, filling up my car with fuel, going to work, going to a doctor or dentist appoint, visiting friends or family, jogging, walking you will see a little shop with a sign that mentions payday loans.  There is no doubt that in our human history have we had these places where you get a loan or an advance payment for your check and you have to pay it back within your agreed time-frame.  With modern day, these payday loan shop have not just easily helped you out giving you loan but they have not given you the fine print of actual loan.  From what I heard through other blogs, news article, tv news, these loan places tend to be open in areas of low-income or poverty living sections of the city.  They know that individuals that do not make a lot of money through their employment, disability, pension, social assistance and their need for a loan is greatly increased and it give them the advantage and the individual the disadvantage.

The myth of the Payday Loan shops is that they will give you a certain sum of money and they will offer you the loan without any hassle or delays.  They will not tell you what the total loan amount will entail; just money that you need to make a living, pay your costs of living, pay your expenses.  It is the individual that will be shocked to find the end result from borrowing just to get by a little bit.  All we ask is that we need some money for a temporary time which will be payed back

They are not there to help the individual easily with their financial stability but to further gain their profit from the individuals’ debts.  There must be some legislation that can be put on payday loan shops to provide all information to the individual the true amount and the total fees with interest.  I would understand interest in the 13 percent to 21 range but hearing of interest rates of 500 percent and up annually is not just ridiculous but inhuman.  

When I pass by these payday loan shops, sometimes I get tempted when it comes to borrowing to consolidate my personal debt.  There is just this inner vibe that tells me to stay away from them.  If you can get loans from reputable institutions such as banks and credit unions then go that route.  Any regulated institution would be safer than shops offering loans without providing disclosure of what is entailed on that loan.  I just get so angry when I hear individuals that get taken advantage of and who have no place to go besides the payday loan shops.  

I would like to gain more insight from others that have heard of payday loans and experiences for those that used them.  I would also like to dialogue with you with regards to this subject and the morality of monetization in our society.  Do you believe that this is one of the reasons that the average person is in high debt?  Can we stop this unethical behavior?

2 thoughts on “Payday loans”

  1. One of the problems of debt in general is that people often feel hopeless and have no place to turn and so continue to borrow when it would in fact be better to face up to the situation and contact a debt management charity or the citizen’s advice bureaus and get help from there. Then, instead of borrowing more, you actually get the chance to stop, budget and organise an affordable repayment – usually just one per month. The debt management company then organises repayments to your creditors. This is helpful as it actually gets people out of debt, gives them more control and addresses the underlying problem. Pay day loans just perpetuate it. Debt management charities are usually free to join and there will be information online about them I’m sure. I’m from the UK and there are several ones that are recommended through the citizens’ advice bureau. Stepchange is one I know of.

    1. I agree that there is a sense of hopeless and that is what corporates want us to believe. There is too much enticement to get the consumer to spend via credit cards, lines of credit and in almost every corner a payday loan shop to get low income individuals that need advance cash to use their services. Every one has a choice but they should be educated to look at the reality of what will help them and what will hurt them financially. Not all institutions are there to help but to do what is best for their interests. The ones that need the guidance are those that easily get caught in the trap to serve the interests of the institutions. Awareness should be put out there whether it is through community organizations, non-profit organizations, organizations developed by the government as in the end it will be the government that will suffer. Remember the 2008 financial crisis in the United States in which many lost their homes, going further into debt, institutions disappearing. All this because there was no regulation put in place. Governments have to step up and prevent this from happening again through regulations. The debt crisis is solvable; it will need to be taken seriously both by the government, institutions and society working together.

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