Payday loans, title loans and other high interest debt

Imagine if I told you that you're going to pay 400% on that loan or that none of the payments you're making are actually going to reduce what you owe Well, it's true

When you need money, man, the sharks are out Payday Loans, Title Loans, Check Cashing, Rent-to-own, Refund Anticipation Loans, Buy Here, Pay Here The list just keeps going All of these services know that you don't have any options That means that they're taking risk and you're definitely going to be paying for it

Let me show you a small example Assume Betty takes a $300 Payday loan for 10 days on October 1st The fee is usually $15 for every $100 borrowed That means she's going to pay back $345 on October 10th That is 547% interest

That's crazy but I know what you're saying, you need to money right now Life's not always pretty The commercials are pretty compelling too I get it What are your options

First, go to a Credit Union or a Community Bank These banks are nonprofits that try to work with consumers in tough situations Nothing's guaranteed but it's a good place to start and get some objective guidance Secondly, take a look at benevolence funds or hardship funds from your employer Many employers have these funds to help employees get through tough times

It's simply another avenue to explore Third, borrow from a friend Now, I hate that advice because friendship and money rarely mix but if you're going down the path of paying 500% interest, it may be worth a call to a close friend Lastly, maybe you just avoid the cost altogether If this is to eat or to make sure you're not homeless, I get it

Go for it, fine But if you're about to rent a 50 inch flat screen TV I don't get it Look, I can't judge your situation but you can Be honest with yourself

If you're going down this route, be really careful and make sure you're focusing on financial fuel so that you can get out of it as quickly as possible Don't let this be a deadly trap for something so trivial