Beware of payday lenders for numerous reasons
When you have fallen a few hundred dollars short of what you need to pay your bills, eat and put gas in your car, visiting a payday lender may seem like an appealing option. And of course, it is ultimately your choice to either sign a payday lending contract or to bypass this option. Only you can fully understand your financial situation and what you need to do to make ends meet. However it is important that you think twice before utilizing the option of borrowing from a payday lender.
First, a payday lender may not be the right option for your situation. Depending on your circumstances, you might more fully benefit from filing for protections afforded by federal bankruptcy law. Or, you might benefit most from consolidating some of your debt or exploring other debt relief options with the help of an experienced attorney.
Second, payday lending tends to be a poor option for many individuals because of the high fees associated with this kind of loan. In addition, many payday lenders engage in shady practices and may take significant advantage of you. Sometimes individuals who opt to work with payday lenders get so bogged down in fees that they feel compelled to take out more payday loans just to cover the fees that they are accruing. This can become a vicious cycle that oftentimes seems to have no end.
If your bills are becoming overwhelming, please consider speaking to an attorney before you explore a payday lending option. There may be other options out there that will benefit you far more greatly than a payday loan would.
Source: New York Times, “ How Payday Lenders Prey Upon the Poor — and the Courts Don’t Help,” Emily Bazelon, April 18, 2014