credit

WARNING: 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?

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! 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?

{ 5 comments }