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Top Ten DUMBEST Reasons To Get A Pay Day Loan!

by Brad Chaffee on August 6, 2009

in Money Management

DUMBEST-IDEAWARNING: The list below has been known to cause delusional thoughts and irrational behavior. If what you are about to read sounds like a good plan, you have been hypnotized and must vacate immediately.  You are in DANGER!  If you want to know what using a pay day loan company feels like, go donate ALL of your blood.  It’s the same thing.  You won’t be doing much with what’s left!  To weaken the effects, complete this exercise immediately!

The following was said to be the Top 10 Best Reasons To Get A Pay Day Loan.  Some of them are considered, by some, to be perfectly legitimate reasons but I disagree with them ALL.  Talk about predatory?  You’d actually have more fun being mauled by a bear!  The only difference is one you actually volunteer for, and the other you run from.  On a serious note, a pay day loan is the worst way to borrow money, and being mauled by a bear really sucks too!

DO NOT Take Warning Lightly, But Let’s Have Some Fun! ;)

1 – Automobile Loan Repayment (DUMB!)

“Excited at the idea of buying your very first car? With rates the way they are, maybe you are getting a great rate of interest on your auto loan and are afraid that if you make a payment late your auto lender might reconsider your status as a safe borrower.”

“A payday loan can give you access to the money you need to make sure your car payment is prompt.”

Me: Can’t you just feel the enthusiasm in his first sentence?  You bet he’s excited, you are funding his retirement.  You would be better off going to your boss and asking for a pay advance to be deducted on payday.  You will pay no interest and likely avoid getting an advance for more than you can pay back come payday.  This is just one way.

2 – Emergency Automobile Repairs (DUMB!)

“You have always been a sensible driver and you have excellent insurance coverage, so you weren’t really worried about that minor fender bender the other day. I mean, your insurance will cover it, right? The answer is that it probably will, but you didn’t plan on having to pay that $1,000 deductible, did you?”

“Getting a payday loan will allow you to be able to pay the deductible now and get your car back on the road much faster than if you had to wait for your next paycheck.”

Me: First of all, if you have a $1,000 deductible without an emergency fund in place, you need to lower it to $500.  Secondly, you’d be better off sucking it up and catching a ride, or possibly riding the bus.  What?  Maybe next time you’ll be prepared for the rain by getting an emergency fund in place.  We often think that we should eliminate the pain of our STUPID mistakes, but feeling the pain is how we learn.  You know the saying no pain no gain right?

3 – Last-Minute Travel (DUMB!)

“Airline and train tickets can be expensive, especially if you have to buy them at the last minute. If you are caught off guard by the need to travel for whatever reason; a wedding, graduation or to welcome a new-born baby, you should know that will have to act quickly to get a decent rate on your tickets.”

“By getting a payday loan, you can take advantage of lower rates for buying your tickets in advance, even if you might not have the money in the bank right now.”

Me: How are you caught off guard by a wedding, a graduation, or a new born baby?  These are usually planned and if they’re not, then you needed more time to plan to be able to go.  I’ve never heard anyone say, “QUICK, I need a loan, someone I care about is graduating TOMORROW!”

4 – Avoiding Late Fees (REALLY DUMB!)

“Frequently credit card companies will charge inflated fees for late payments. In some cases those fees can be as high as $30 or more.”

“Using a payday loan is only a good idea in these situations when the payday loan fees are less than the fees charged by your credit card company.”

Me: So getting a payday loan that charges interest is better than paying the stupid tax, which is the $30 late fee?  Do a budget to get a clear picture of what your financial picture looks like.  That should eliminate any need to shake hands with a loan shark.

5 – Credit Card and Overdraft Debt (REALLY DUMB!)

“More and more people are considering an unsecured short term loan such as a payday advance as a quick way to pay off high-interest credit card debt that is threatening their credit history.”

“By using a payday loan to pay off outstanding debts you can keep your creditors happy and your credit score stable, so long as you are able to repay your payday lender in the allotted time frame. Payday loans can also be a reasonable consideration if you are caught in a situation where bank overdrafts and returned check fees are adding up and you are unable to get out of the situation between pay periods.“

Me: Not sure I know anything else that charges more interest than pay day loan companies, do you?  These things have been known to reach well above 500%!!  STOP thinking that by moving your debt around you are doing something.  Just become a gazelle and pay it off!

6 – Home Repair and Improvement (REALLY DUMB!)

“In most cases, home owners will use the equity they have built up in their home over the years to finance much needed home repairs or improvements. For those who might not have enough home equity to make that possible, a payday loan might be just what you need to make emergency repairs to your appliances, your windows, or even your roof.”

Me: If you want to repair or improve your home you need to sit down with your spouse, discuss your options, and formulate a coherent plan that involves saving money.  You certainly should not sell your soul to the payday loan guy to improve your house.  How about improving your finances first? :D

7 – Wedding Expenses (REALLY DUMB!)

“Weddings are not cheap. Perhaps you are the parents of the bride and as such you are expected to foot the bill for your daughter’s big day. Or maybe this is not your first time at the altar and you’re paying for everything yourself. In either situation you might consider an unsecured loan as a way of meeting your immediate financial obligations so you are able to rest easy knowing that the wedding day is paid for.”

Me: I don’t know what this obvious commissioned salesman is talking about because weddings can be cheap.  They only need to be as extravagant as the wallet paying the bill.  Weddings can be nice on the cheap!  If you are getting married and paying for it yourselves then you should have already figured costs.  If you need more time to have just the wedding you were hoping for then pick a date that allows you to reach your financial goals.

8 – You Have Bad Credit or Bankruptcy (DUMB!)

“Most of the time, people with bad credit simply cannot qualify for a loan from a traditional lender, but that does not mean they won’t incur unexpected expenses, does it? The beauty of payday loans is that the vast majority of these lenders don’t even run a credit check!”

Me: If you have bad credit and are bankrupt, you need not be digging the hole any deeper.  In fact, if you have filed bankruptcy and are finding you need a payday loan then it is proof that the bankruptcy DIDN’T fix the problem.  You don’t need a payday loan, you need to modify your behavior.  You need a plan.  You need to grab the bull by the horns and get serious!

9 – Got a Hot Date? (The DUMBEST reason I have ever heard!)

“You have been asking someone out for weeks and you weren’t anticipating them to say yes on the one week when all you have left in your wallet is unpaid bills and lint. A payday advance can save the day and give you the money you need to make a great first impression.”

Me: What a laugh I just had!  If you are asking anyone out on a date knowing you don’t have any money your problems are bigger than you think.  Plus if you have no money then it’s not the first impression you should be worried about, it’s the second and the third and the fourth…you get the point.  Question: If you didn’t have the discipline to save in the weeks leading up to the final yes, why are you convinced that you will suddenly change after the first date?  Just wondering.

10 – The Cost of Living (Second DUMBEST reason I’ve ever heard!)

“Let’s face it — there are always emergencies coming up that make it next to impossible to make ends meet between paychecks. No list of reasons to take out an unsecured loan is going to be comprehensive, because the only one who knows your situation is you. Your reasons for taking out a cash advance are your own. Just make certain that before you take out an unsecured loan you know you will have the means to pay it back when it comes due; otherwise you may just end up putting a very temporary bandage on a larger financial wound. Don’t let that wound get infected!”

Me: Usually when a salesman says let’s face it, you should assume that the next thing out of their mouth is a lie! :D Let’s face it says, there are no other options.  This is a lie!  To cover “the cost of living” you should look for a second job, or a better first one, and sometimes both.  You don’t need to supplement your income by getting a payday loan.  If your income isn’t covering your expenses then a payday loan will do nothing but continue the cycle.

The Bottom Line!

Plan your future.  Yep, it is that simple.  Make better decisions with your money and you will have some to save , invest, and give!  Don’t take my word for it, see for yourself.

Remember the best defense is a great offense!

The Get Rich Quick Method via Pay Day Loan Theory Debunked!

Here’s how the payday loan cycle works.  You go get a payday loan when life happens, because how in the world are you supposed to make it until next week when you get paid?  You decide to get a cash advance from next weeks check, and now you have to wait 3 weeks until you get paid again.   On payday you have a partial paycheck that has to stretch for a full pay period.  Guess what?  Life is going to happen to you because you are BROKE.  When it does, you rush to the payday lender to get more ‘help’.

This is no great offense!! If you get one you’ll find that it’s not exactly a defense either. ;)

It’s a cycle that soon becomes hard to break.  DON’T DO IT! Find another way.  Be creative, but don’t sign your check over.  Do EVERYTHING you can to avoid getting one.  Don’t allow someone else to become mega rich off of your mistakes.  Plan!  Be proactive!  Be DEBT FREE!

How many times was the word payday used…jeez?

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Debt-ception – Why Do We Fall For The Lie?

by Brad Chaffee on April 7, 2009

in Money Management

Debt-ception Is Everywhere!

The use of debt is rampant and highly irresponsible.  Because we think the good outweighs the bad, we allow ourselves to justify its use.  We tell ourselves that it is okay because it is helping us, ignoring all of the signs of its destruction.  We have replaced good old fashioned savings for the servitude and hardship that debt brings us.  In my opinion we have done this because we have forgotten that no journey worth taking is easy.  We have lost hope in our lives and in ourselves, but I know how to get that back.  Learning how to become debt free is a great way to start!

What Debt IS in four telling words:

  1. Deceptive
  2. Exploitative
  3. Bondage
  4. Tragic

Deceptive
It fools us into believing that it is there to help us, while working behind the scenes to keep us from realizing our true capabilities.  It lures us in by convincing us that we can have more by increasing the quality of our life.  It builds our hopes by fooling us into believing that we can have anything we want without a hefty penalty.  I mean come on, what’s a little interest?  What happens next is anything but the happy, relaxing, dream come true that you were looking for!

Exploitative
All your credit cards, personal loans, car payments and other forms of debt are, are other people using your money to build wealth for themselves.  Often the poor and elderly are exploited the most!  Pay day Loans, Rent-To-Owns, and Reverse Mortgages to name a few.  One way to avoid becoming exploited is to plan for your retirement.  There’s a thought!

Bondage
Debt is nothing short of slavery.  It chains us down keeping us from being able to move freely without stress or severe pain.  The servant status obtained by using debt is unavoidable.  Once you sign the papers you are its slave.  It will eventually render you lifeless as it drains every ounce of hope out of your tired body.

Tragic
With debt comes death!  No not your death, but the death of your hopes and dreams.  The tragedy is that so many of us have forfeited our chances to use our income to truly better our lives and those around us. To have the same opportunity to build wealth as the next man, as proven in the Ben and Arthur Example, and NOT…is the very definition of tragedy! (A disastrous event, especially one involving distressing loss…)  The longer you ignore the problem the more you will lose along the way.

Why Do We Use Debt?

We use it because we always want more and we decide to overlook the deception taking place in order to get it.  We use it because we have been taught that debt is a part of life, and that it is the only way we are to achieve.  We use it to convey success and status.  We use it because we are too lazy to save for the things we want.  We used it to cause our current economic decline and some of us are still trying to figure out what happened.  Debt happened, that’s what!

Why You Should NOT Use Debt!

Debt creeps into your life by deceiving you.  Then it gets fat off of you, declares you as enslaved, and keeps you from ever experiencing the freedom you deserve.  That is a tragic!

STOP the DEBT-ception before it is too late!  When is it TOO LATE?  I don’t know so you should get started NOW!  Too late could be tomorrow!

Random Thought

I have often wondered why some people hate corporations so much.  They provide jobs, benefits,  & more affordable products for everyday life among other things.  It’s corporate greed that they hate right?  I hate corporate greed too, but I don’t really associate greed with every corporation.  People who love money so much that it causes them to steal from others are who you hate, not the company they fooled along the way.

Then I figured it out!  Debt has caused you to loathe corporations that are making gobs and gobs of money off of you in the form of interest.  Let me see if I understand this correctly.  You hate something that you obediently begged to participate in by signing your name.  I have the answer you have been looking for: DON’T BORROW MONEY!! Debt is enabling someone else to become VERY rich off of your sweat, tears, and labor!!

Instead use that same income to plan for your families future by saving, budgeting, and building wealth.  Use that wealth to combat the greedy scum by doing great deeds with your money.  It’s called a counter offensive strategy!  End the deceiving cycle that is debt by learning how to become and remain debt free!  It’s worth the effort and way less painful than the alternative!

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To Be Bullied Or Not Be Bullied, That Is The Question

by Brad Chaffee on September 8, 2008

in Money Management

I think that dealing with creditors is probably one of the most emotional experiences one can have at a time when they are likely the most vulnerable.  Think about it.  When you owe someone money and they are constantly hounding you to pay what you already know you owe, it can break anyone down who does not know how to handle them.  Usually what happens is they use tactics to bully you into using your grocery money to pay them NOW!  Credit Sharks In Suits (FPU Lesson) is great for helping you learn how to deal with these sharks, as well as learn how to avoid them all together.

Myth:  You need to take out a loan or open a credit card to build your credit score.

The truth as Dave Ramsey explains it, is that a FICO score is no more than an “I LOVE DEBT SCORE”.  You have to continue to go into debt and pay it off in order to maintain a good score.  Everything used to determine your score is based on debt.  Old debt, new debt, level of debt, length of debt history, and debt payment history.  Someone has started a myth that says you HAVE to borrow money in order to establish yourself in the world.  Your financial responsibility is based on how irresponsible you are with money.  What is wrong with this picture?  Now some would argue that you can have debt and still be financially responsible, but I disagree.  When you borrow money to buy something that you do not have the cash to buy, common sense says that you can’t afford it.  Is it responsible to borrow money that you don’t have to buy something you can’t afford in order to build something that you don’t need?  Your FICO score is a tool for the banks to win NOT YOU!  Some often cry that they need a credit score to get a mortgage one day.  This is also a myth.  By going to a Mortgage Lender that does manual underwriting, you too can get a mortgage without going into debt to earn the privilege.  Save a down payment, be early or on time with your rent payments for 2-3 years, maintain the same job for the same amount of years, and of course make enough to be able to afford that house.  Don’t buy into the myths anymore!

How do you deal with bullies that use fear tactics and guilt to collect?

The basics to dealing with collectors are as follows:

  1. Your income should FIRST cover your FOUR WALLS. (Food, Utilities, Shelter, Basic Transportation)
  2. If you don’t have the money to pay them DON’T pay them. Don’t let them use fear tactics to make you pay them money you don’t have.  Prioritize your necessities and when your income runs out that’s it.
  3. Make the creditors treat you with respect when they call and only allow them to call you every two weeks.  If they try to bully you or make you feel guilty tell them you will talk to them in two weeks but only if they behave.  Deal with them on your terms, but be sure that you are fair at the same time.  After all you do owe them money?
  4. Do a budget and consider using the Pro-Rata method to give yourself some time and traction to get out of your mess.  This method will in some cases keep you from being sued, as well as buy you six months to a year to gain control.  Do not be confused, they can still sue you, but if you are trying to do everything you can to pay them the money you owe them they may not be as likely to waste their time taking you to court.  (I will post an example of the Pro-Rata method on my home page in the sidebar.)
  5. NEVER, EVER give your creditors electronic access to your bank information.  They will lie to you about how much they will take.  Get any deal you make in writing before you send them payment.  Mail your payment certified so they can’t say they never received your payment.
  6. In EXTREME situations where you are threatened or worse you can write a Cease and Desist Letter to keep from contacting you.  You only want to do this in EXTREME situations because when you cut off the communication good or bad, they will surely sue you in court.

The bottom line is that no matter what situation you find yourself in there is a likely solution to YOU turning things around.  It is going to take some patience and hard work, but YOU can do it!  Once YOU start to get some traction with YOUR money YOU can accomplish so much.  Most people make the mistake of buying into the lies that creditors use in order to get them to pay.  When YOU are in control YOU will make better decisions, and the light at the end of the tunnel will begin to emerge.

Good luck and make the decision today to not be bullied ANYMORE!

Do you have a story you would like to share about an experience you had dealing with collectors?  Tell us about it.

EDITED:  Changed Title ending, but forgot to change the beginning too.  BC @ EOD

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A Gentle Scream!

by Brad Chaffee on July 28, 2008

in Money Management

How can a scream be gentle?

Debt CONsolidation is a CON.  It’s what normal people do and normal people are broke.  normal people do it because they are conned into believing that it will solve all their problems.  If saving interest on a few STUPID debts and giving it to the broke guy conning you, is your idea of fixing your problems, then consider being weird for a moment.

Why pay someone to cut you?

Paying someone to “work out your life” is not what you need.  All you are doing is moving your debt, that’s it.  There’s not a solution on the table when dealing with these people.  Their loving embrace is laced with deception as they claim to understand.  What they truly understand is that they are making money off of you – LOTS OF IT!  They are certainly not doing it for free.  The problem is closer than you think.  The problem is your behavior, NOT what your behavior created.  You have to change your behavior. If you continue to do the same stuff, you will continue to get the same results.  First you have to believe you can consolidate your debt by changing your ways.  Do you want to know how?

I’ll give you the HARDCORE, TIME IS RUNNING OUT version

Problem number one is that your payments per month are disastrous.  Sell the near $1,000 vehicle payments, and you’ve already loosened the shackles enough to give your neck a breather.  That number is not even taking into consideration the amount you would save if you replaced them with cheaper paid for vehicles. (Car insurance would go down as well as your property taxes, and possibly fuel costs too.)

Common Arguments:

  1. We’re already upside down on them, we would lose money. You’ve been losing money on them since you drove them off of the lot, that is why you are upside down.  Sometimes you have to cut your losses, especially if it continues to cost you.  This loss is referred to as stupid tax.  All of us have done stupid, and the price of getting vehicles you can’t afford is sometimes costly.  It’s not safe to assume that because you can make the payment that you can afford it.  Take into consideration all of the added costs, and then throw in life happening right on top of it!!  What? No savings either?  
  2. We NEED reliable, roomy transportation for our family. That you are doing right, what you are doing wrong is thinking that signing up for a bunch of debt is your ONLY method of achieving the same goal.  A paid for car drives a whole lot better than one dragging payments behind it!!  NORMAL people have car payments, BE WEIRD because remember, normal people are broke!
  3. We do not have the money to pay the difference and buy two paid for vehicles. You don’t have the money to keep doing what you’ve been doing either- so what’s the difference?  Here’s the difference.  Dave’s way saves you over $1,000 a month and you are 4 or 5 years closer to releasing the stranglehold of bondage!  Worst case scenario is that you have to get a loan to cover the difference plus no more than an extra $2,000 per car to buy reliable paid for cars.  You’re trading HUGE loans for much smaller ones.  That’s real consolidation.

Those are just a few excuses there are probably more, but I hope my point was loud and clear!  What you have done with money so far, has got you right where you are right now – consider trying something different!  You have now found out that you can’t rely on anything being steady because life happens.  You never know when that will be but if you are prepared for it then it doesn’t steal your hopes and dreams every time it drops in to say hi.  The only thing that you can rely on is that life will happen!!  The only question is, are you going to be ready when it happens again?

Love is spending less than you make

Give your family the gift of security by changing your family tree now.  The hope is there you just have to be sick and tired of being sick and tired!!  You have to get mad, and most of all you have to hate debt!  Debt IS your enemy!! Annihilate it now before it beats you and robs you of your soul.  You have the ability to stand up and win, you just have to do it God’s way.  God’s way is not about having every thing you can, it’s about giving every thing you can.  Even though that does not always mean financially, it’s a great place to start!  Love your family by preparing them for when Life happens.

LIVE like no one else, and later you can LIVE & GIVE like no one else. ~Dave Ramsey

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Is It Really EASY Money?

Do people really think this is “EASY” money? Can you say OXYMORON? Good because money isn’t easy, and there is certainly nothing easy about paying more than 500% annually for a loan that will most likely amplify the problem instead of fix it.
Have you ever considered getting a Payday loan?
Every day many people [...]

6 comments Get Motivated!