Payday Loans – When You Are in a Bind

Payday Loans – When You Are in a Bind

It happens. The gas company double charges you for a bill, and instead of refunding the money, they give you a credit. Never mind that you are suddenly out over a hundred dollars for that month! If it wasn’t the gas company, then the cell phone company got you when your kid decided to go on a texting splurge, and you didn’t sign up for unlimited texting. Whatever the reason, the results are the same: suddenly you don’t have enough money in the bank to make all of your bills that are falling due. It’s temporary because you will have them money in a couple of weeks with your next paycheck, but if you don’t pay that bill soon, your credit will be ruined.

For times like these, payday loans are an option. They can forward you a couple of hundred dollars, and you can stay afloat. However, emergency measures call for emergency pricing, and it aint cheap. A $30 fee seems reasonable for a $200 advance. You’ll have that $30 soon, but you don’t have the $200 now, which is what you need. But that $30 is for a two week loan. That means the APR is 360%! You would never purchase a car or house with that kind of interest. But not getting the loan means that your credit will be ruined, and you’ll be paying higher interest on your credit cards and other loans, so the fee is worth it.

HOWEVER, if emergencies are cropping up regularly, and you are using the service often, then it’s a very bad idea. Even credit cards have lower interest. This would be the time to start budgeting. It may mean living a little lean and getting rid of the premium package on your cable, but creating a savings to fund these emergencies is always better than paying hundreds, sometimes thousands of dollars every year. You could buy a new flat screen with the money saved in interest charges.

Be smart. If you are in a temporary bind, find a payday loan service. If you are always in a bind, cut back on spending. Don’t get quilled.