Payday Loans - Are they right for you?

A Payday Loan Video - Is a payday loan the right financial tool for you?

Most of the media attention on Payday Loans is negative. However, if Payday loans are so negative why are so many people using them? Could it be that they actually solve a financial problem that many people face? Could it be that most folks who use this product actually have a good experience and have gotten full value for the situation they are in? Finally could it be that the media focuses on the unethical proprietors in this market niche? It does make great press. Wherever there is spectacular press, the politicians are hovering like vultures to garner some of the attention posturing as saviors of the masses.

So let’s examine using Payday Loans.

Demand for the product:

The reality is that some folks only have only their job and their paycheck in their financial toolbox. If they get hit by surprise expenses or opportunities, the only way that they can access their future income is through a Payday loan. Especially in these hard times access to more user friendly tools like credit cards and lines of credit has been cut. Limits have been reduced so that “Main Street” folks are now in this situation as well.

Cost of the product:

If a stranger walked up to you and asked to borrow $500 till payday, would you loan it to him? To put yourself into such a high risk situation you would have to be a good risk taker and you would expect to be rewarded for taking that risk. So yes, this product has a cost and it is in line with the risk.

Any product should pay for itself. This should be true if you use a Payday Loan. The loans should pay for the car repairs so that you can get to work and pay for the loan. It should be cheaper than paying NSF charges on your bank accounts or over limit fees on your lines of credit or credit cards. It should finance an opportunity to buy and sell something so that you can pay the fee plus make a profit for yourself. If it doesn’t do that it must finance something that is so important to you that the cost is worth it in other ways.

Ethics of the product and the industry:

A Payday Loan should be just that. You should pay it as soon as you get paid. You should be able to pay it and still be able to survive without another loan. A Payday Loan should be a financial tool that you do not use very often.

The one aspect of the industry that defines its ethics is the rollover. A rollover means that you only pay back the cost of the loan and then the lender renews your loan for the full amount at full cost. And that is due the next payday. If you are offered or ask for a rollover you are being violated financially or you are committing financial suicide.

Conclusion:

There is a demand for Payday loans. If you can’t get them in one state you will find a way to go to where you can get one. The cost is high because they are high risk. Finally they are dangerous. They are relief for a short term financial problem. If you use them for anything else, you are being financially irresponsible and need to do a complete review of how you manage your money. Apply Online for a Payday Loan