We know what it’s like to get in a sticky spot where you don’t know if you’ll be able to pay your bills. We’ve been there. You might be tempted to use online payday loans, but there are some things you need to think about first!
Predatory lending is real!
Payday loans might seem like the perfect way to lighten your load of bills if you’re struggling to pay for everything on your plate. However, you need to know that you could end up paying as much as 400% back on the money you borrowed. You will lose money if you get a payday loan.
The one positive thing we can come up with about payday loans online is you might not have to pay them back at all if they are illegal. There are laws against predatory lending and many online payday loan companies are predatory lenders. While you should always contact an attorney before you shove your payday loan payment aside, you might want to consider the options you have!
It’s a good idea to avoid these mistakes if you absolutely must get payday loans online.
1. You haven’t read the contract.
Many times, these predatory lenders jump at the opportunity to fool unsuspecting people who are already struggling. They see you as a target and make their contract seem legitimate. You need to read the contract before you sign anything or before you accept any kind of money. Read it the whole way through. If you struggle with reading or you can’t quite comprehend some of the language in the contract, enlist the help of a friend to make it through all the purposefully confusing legal jargon. You might find that you are entitled to a way out of the repaying the loan!
2. You’ve mistaken payday loans online for in-person loans.
For years, storefront payday loan shops have closed their doors. While you might have paid higher-than-average interest rates at these places, you likely weren’t paying as much as 400% like with payday loans online. The new companies online can do what they do because there’s no face to go with the name. They rely on anonymity to essentially rob you using high-interest rates. If you do find a storefront payday loan place, it might be a good idea to get your loan from there instead of online.
3. You’ve lied on the application.
Even though we can’t give you legal advice, the one thing almost everyone can agree on is: don’t lie on applications of any kind! While there’s a good chance you won’t go to jail, you still should not lie on your application. If you want payday loans online now or in the future, lying on the application could jeopardize that money. Even though they are predatory lenders, it’s a good idea to not lie so you have a chance of getting the loan.
4. The company you chose isn’t legitimate.
Choosing payday loans online that are actually legitimate can be tricky because most of them aren’t legit. These companies are not backed by any banking insurance and there’s no guarantee that you’ll get your money after they have your bank information. In general, loan places that have poorly designed websites, not a lot of information and no reviews are not legitimate.
You can also check the BBB to determine if a loan company is legitimate. Keep in mind that disgruntled borrowers will leave reviews of the company that are usually bad. Instead of looking at the reviews, look at the actual rating of the company!
5. Payday loans are illegal in your state.
Many states have outlawed payday loans. The chances are if you live in a suburban or urban area and there are no storefront payday lenders, they’re illegal in your state. The legality of it doesn’t affect payday loans online. Many lenders rely on tribal law and other ways of getting around the legal aspect. You likely won’t get in trouble for the payday loan, but the lender might be able to. You’re also in luck because if payday loans are illegal in your state, you could possibly get out of having to pay it back.
6. You haven’t researched all your options.
We found good news! You might not need a payday loan after all. There are things you can do to get a loan that will help you.
- Consider a payday alternative loan if you’re a member of a credit union.
- Hit up your family and friends (ugh, we know this one is hard).
- Borrow from a payback lender on Reddit.
- Get a subprime credit card…even high credit card rates beat 400% interest on payday loans.
- Sell some stuff on Craigslist.
- Start a GoFundMe to raise a little cash (this one can take some time and can feel like begging, but hey, that’s what the site’s for).
If you’ve used any of these tips for avoiding a payday loan or you have a great idea, please share it with us in the comments!
Learn more about saving money!
We are not lawyers or a law firm and we do not provide legal, business, financial or tax advice. None of our representatives are lawyers and they also do not provide legal, business, financial or tax advice. The accuracy, completeness, adequacy or currency of the content is not warranted or guaranteed. Our sites and services are not substitutes for the advice or services of an attorney. We recommend you consult a lawyer or other appropriate professional if you want legal, business, financial or tax advice.
