Payday Loan Bad Rap
Payday Loan Bad Rap
Bad Credit Short Term Loans
Many people critisize the payday loan industry for preying on the less fortunate. This is a sad situation because the industry provides a service
that actually helps many people.
Sure, there are people who abuse short term loans and get into a situation that is worse than when they began, but these people are the exception, not the rule! Most payday loan borrowers are able to pay back their loan as promised and do not fall victim to the so called ‘payday loan trap’.
The loan companies are not out to hurt anyone. They are in business for the
same reason anyone else is – to turn a profit! From my personal experiences, they do not employ tactics any different than any other lender I have used.
Do they want their money? Sure they do! And rightfully so. Is the interest too high? In reality, not really.The short term paydayloan has what seems to be an extremely high interest
rate at first look, but upon further review, it is not far off from many other loan products. The difference is the timeframe for repayment and the
risk involved for the lender. The payday loan lender is taking on a hugh risk when they make the loan! The borrower is also taking a risk when they borrow, but the obligation to repay is on the borrower. The lender would love to have repeat business with someone who repays well and may even offer discounted rates for repeat customers!
Before judging the payday loan industry as a whole, it is wise to discover who the borrowers are and why the people borrow. The payday loan fees can be significantly lower than bounced checkand late fees the borrower would otherwise face.
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