Whether it’s insurance or emergency fund, if you are not lucky to have a relative or friend, the chances are pretty none. A bank will not lend money because you need some $500 cash at the end of the month. Banks deal with big amounts and for bigger terms. In such cases, small-term payday advance loans are your best bet. More than 10 million Americans take payday loans each year, and so far this is a booming business across the States. So much so that some of the states have become debt traps for regular defaulters.
Many payday advance companies have been found to be scams. The DFI always receives complaints and investigates them with proper caution and issues warnings to customers to blacklist lending agencies. Many unlicensed payday advance schemes are fake and can lead to fraudulent activities using the personal information of borrowers.
Payday Advance Loans are Good when Legit
To find out about your nearest payday advance loan company, go online and do a quick Google Search. This will unveil many important things such as any investigations that the company is currently under if it have been in news for illegal practices and so on. In earlier days when there was no internet and the only source of information was from the horse’s mouth, it was impossible to discern truth from lie. Now, with payday advance loans available online, you can query and research your lending firm before you share your info.
- Parents are more likely to use payday advance loans than those without children.
- The disabled and unemployed are more dependent on payday loans for obvious reasons.
- Those who are separated or divorced are twice more likely to use payday advance
- Most of these, about 69%, use payday loans to cover credit card bills, rent, and food like basic needs.
The above data from surveys conducted over years suggest that this loan offered on behalf of your salaried account is one of the lifesavers for people in the US. Both immigrants and the native population depend on them for daily life. Thus, when these lending firms are legit and helpful rather than misuse people’s trust, these short-term loans can be more useful than banks.
Moreover, people tend to overuse these loans and even apply for them regularly throughout the year. This can be a topic for another discussion, but overall these loans are utilized to make ends meet. It is tragic but true.
Where do People Go for Loans?
The majority of around 73% of people go to storefront offices for payday advance loans. Those in the southern states of the US are more likely to take out these loans than those in the northern states. This is mostly due to the income inequality among the households, the number of adults in each family, their average income and so on. In addition to that, Americans residing in the north-eastern states are least likely to take out payday advance loans compared to other geographic areas. Finally, comparing urban vs rural areas, those residing in urban areas are more likely to apply for these loans online.
Regulation of loans and lending agencies depends on each state. They have their laws and rules. This means that some states are better, relatively than others. Payday advance loans have a bad reputation for their very high-interest rates and this is why some states might be preferred than others. In all, if a lending firm is legit and you are in a financial emergency, payday is a better option. Just keep in mind not to default.