If you are one of the numerous Ohio residents who is struggling from pay check to pay check, you have likely looked at instant money solutions. Payday loans are extremely popular, but are they a risk worth taking?
There is nothing like being short on cash when an emergency strikes or when money runs out between pay checks. A payday loan can offer quick cash to get you through until your next payday — at least, that is what lenders claim they do. What they won’t tell you is how much in interest you will end up paying.
Payday loans are…
A payday loan is essentially a cash advance on your upcoming pay check. There are two ways to get this type of loan — either online or at a brick-and-mortar institution. The application is quick and painless, and approval usually happens instantly. Sounds amazing, right?
Payday loans come in relatively small amounts, generally anywhere from $500 to $1,000. As soon as your next payday rolls around, your loan is up and payment of the loan amount plus interest is due.
Can’t pay it back
What happens if you can’t pay back a payday loan? This is where these lenders get you. Most people end up having to take out an additional loan just to cover their first one and their other expenses that they still lack the funds to pay. This results in a cycle of borrowing that can be very difficult to break. This just forces you into greater debt.
Is there a better way?
When you are struggling to make it financially, there are debt relief options that may actually help you rather than make the problem worse. Bankruptcy, for example, depending on the type you qualify for and if the court approves your petition, can result in the discharging of your debts or an affordable repayment plan created. Either could really help you get back on your feet.
Learn more about your options
When you need money now, it can be tempting to jump on the first solution that presents itself and offers a quick fix — like payday loans. It is okay to take time and learn about your options and which will actually help you achieve your financial goals. With legal guidance, you can make the best decision for your situation — one that offers a long-term solution.