pay day loans - ILLEGAL

Discussion in Scams = To Good To Be True started by Rhoda D'ettore • Dec 10, 2014.

  1. Rhoda D'ettore

    Rhoda D'ettoreMember

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    Don't fall for pay day loans... which are so easy for those of us who need money quickly. Some of these companies are offering $500, but the the time you pay it off, you could be paying back thousands of dollars.

    What is more interesting is that this is actually illegal-- it is considered "usery" which is the same crime loan sharks are charged with. In NY, they shut down one of the most popular sites, mycashnow.com for this exact reason.

    If you have fallen into the trap of pay day loans, be sure to talk to your bank. It might be possible to stop payment on the withdrawals due to the fact they are illegal.

    Good luck
     
  2. missbee23

    missbee23Member

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    They are predatory, and prey on people who don't have strong financial sense. When someone is in financial trouble, all they are thinking about is getting through the crisis that they have right in front of them (paying rent so they don't get evicted). What many don't realize is that they are setting themselves up for even more trouble down the line by talking themselves into believing that they will be able to afford the repayment. I have been there before. What are you supposed to do when you don't qualify for public assistance, family and friends can't help, and churches these days don't really help people anymore, they just refer you to someplace else. It's a tough place to be. There are tons of programs to help the poor. I wish there were programs to help the borderline poor. If there were more programs to help prevent poverty in the first place, then we wouldnt have to spend so much to help people in general.
     
  3. Denis Hard

    Denis HardWell-Known Member

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    Someone applying for a payday loan knows that they'll be paying exorbitantly high interest rates for the loan but because they desperately need the money, they'll take the loan anyway. IMO if someone needs a some cash then it would be better to try all other options first: credit unions, P2PL, etc because the interest they'd have to pay isn't that high.
     
  4. pafjlh

    pafjlhActive Member

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    You don't have to tell me how viotile these are. I have a family member who got in deep with these. Don't ask me why they would actually go to one of these but they did. Anyway, becasue they were unable to pay back the loans their wages were garnished. Now they are filing bankruptcy and its a mess. I know just from watching the hole they got themselves into never to even consider a payday loan.
     
  5. AngelicDevilTel

    AngelicDevilTelActive Member

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    I know that I will never go for a payday loan, heck I don't even want student loans at this point.
    The interest on payday loans is vast and even worse for those people that think it is easier to get one online.
    I think it was CashAdvance that got shut down here a few years back and they faced a major lawsuit to boot.
    PayDay Loans just aren't worth it IMO
     
  6. Heather Dawn

    Heather DawnNew Member

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    I got involved with a PayDay loan place when I was in my early 20's - it took over a year to dig out of the hole. I blame my lack of financial sense and desperation, but I was still able to pull out. It was rough, but once it was over I let it drift from my mind and never dealt with one again.

    I honestly did not realize how big of an issue these companies really were until John Oliver dedicated a segment to their practices. For anyone who has watched his show, you know it tends to edge into eye opening - this episode was no exception. As mentioned previously, they are illegal in most places, but they get reclassified as a different business to skirt the rules and fly under the radar.

    My mother has been in a bind with a company in Florida, not really a payday loan place, but a title loan, which runs under the same concept, except they can take your car. Same astronomical interest rates, cut-throat tactics and lack of leniency. She won't talk to me about it and has refused any help. I worry.
     
  7. Rosyrain

    RosyrainActive Member

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    WA State just passed a law a few years ago in which a person can only have 1 payday loan at a time. With as many payday loan stores as there were here, people could literally get a couple thousand dollars and would have to bounce back and forth between companies on payday to get them all paid on. It was a good move on our states part because many of the companies ended up shutting down as a result of it.
     
  8. aparsons

    aparsonsNew Member

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    These places can be extremely dangerous. Where I live, they aren't completely outlawed so they are still everywhere. It is disgusting thinking about how these companies operate and how they prey on people who have no other option. Fine print and hidden fees are two of the worst things in modern purchasing. It seems that any service you purchase these days has all kinds of hidden fees and costs. I have seen a few people lose a lot of money or completely destroy their credit due to place like this. Unless you have absolutely no other option, do NOT get a payday loan. If you absolutely have to, make sure you read and understand everything before you sign!
     
  9. pwarbi

    pwarbiActive Member

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    Payday loan companies prey on the people that are in debt and are desperate. When you look at the interest rate they charge, its unbelievable how they have been able to get away with it for so long. All they do is make a bad situation ten times worse for people. Stricter laws need to be put in place, if that will ever happen though seems unlikely.
     
  10. Rosyrain

    RosyrainActive Member

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    I would rather borrow money from a pesky relative than borrow money from a payday loan lender. It is shameful that someone could be allowed to borrow up to $1000 against their next payday and then be expected to pay that money back at their next payday with huge interest fees. If the person does not have the money to spare then they are forced to reborrow and spend a lot more in interest fees. I wish these kind of loans would be outlawed everywhere.
     
  11. worldmachine

    worldmachineActive Member

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    I agree with what everyone else has said on this subject, we have exactly the same issues with these companies in the UK. The most despicable aspect to them is that they target vulnerable people and they use underhand tactics to harass them. There was a case recently where one of these lenders was caught sending fake threatening solicitors letters to it's customers. It was discovered that the pay day lender had typed them up themselves and that solicitor's name they gave didn't exist.

    Until recently there was no cap on the amount of interest these people could charge, i saw one lender offering money at almost 5000% interest! The government has now begun to regulate these firms better and put a cap on the interest levels they can charge. I think pay day lenders should be banned outright, they trade in misery and have no place in a decent society.
     
  12. Pat

    PatWell-Known Member

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    I have seen the title loans on tv and wonder why a person would get a title loan, it is using your car as security and is like getting a new car loan at a higher price. It is such a shame that people will take advantage of people when they really need serious education on what they are doing.
     
  13. JoanMcWench

    JoanMcWenchActive Member

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    Pay day loans are just ridiculous. It's the modern day loan shark. Great scheme though for them as a company making huge profits for 'borrowing' small amounts. I understand people get into situations where they're desperate but this is a terrible choice.
     
  14. kana_marie

    kana_marieActive Member

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    Wow! I had no idea. I've seen people get in really deep with them. I knew one lady who juggled 3 of them at once, and then just kept robbing Peter to pay paul. I even knew a girl who got in too deep and everything was about to come crashing down. She wanted to come up to the restuarant I managed and "rob" me for the nightly deposit. I told her it wasnt going to happen, and she dropped it. Have you ever seen anyone so desperate to pay a bill???
     
  15. Brenda Barnousky

    Brenda BarnouskyActive Member

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    These are indeed terrible, and probably should be closed down nationwide, but I think credit cards are just as bad, and just as predatory as payday loans.
     
  16. MyDigitalpoint

    MyDigitalpointActive Member

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    Credit cards can lead you to bankruptcy, only that it takes longer for this, and credit cards are a legal, but indeed predatory, financial instruments.

    However when it comes to payday loans, these are illegal just in a few states of the United States, in all others are allowed, but in some there are already restrictions on how much a borrower can ask, and a cap on the interest rate lenders can charge, but laws on payday lenders are state laws, not federal regulations.

    Summing up the fact of "how easy" is to get them online, you may find yourself borrowing from a payday loan lender where payday loans are legal, no matter if it is not in your own state.
     
  17. Penny

    PennyActive Member

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    I used a payday loan once because I absolutely had to fix the car and payday was a few days away. I agree that you can easily get on a slippery debt slope with these things. But my bank was frelling useless and without them I could very well have ended up unemployed. If you can understand what you are signing up for and make the payment, I think they are sometimes (albeit not very often) a viable option.
     
  18. MyDigitalpoint

    MyDigitalpointActive Member

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    Yes, whenever anyone knows that payday loans are the loans with the highest interest rate, but still needing the money and absolutely sure that repay the loan in the next payday is totally possible, it's worth to get one to cope with unexpected expense coming one's way.
     
  19. BrandonScooterman

    BrandonScootermanActive Member

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    These places are awful. Most of the physical locations are legal, but just barely so.
    They are always more plentiful in the poorer area's of town.
    I hear that there are some better options online but most people don't trust them.
     
  20. Heydude41

    Heydude41New Member

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    ugh hate them. They will suck you dry.