Payday loans hurt finances more than they help


the federal government right now through
the Consumer Financial Protection Bureau trying to write rules governing payday
loans payday loans or loan where even if you
don’t have good credit you have no credit you can go borrow money just because you
have a job the problem payday loans carry interest
rates have usually 400 to 800%
percent they don’t tell you that but that’s what they carry now the real
real real problem with payday loans is there ultra-short loans bit when they
come due people can’t pay ’em so they were
rolling over into a new one and then another and then another and
then another and when you’re done you’ve ended up paying
interest that is way way way greater than the
amount of money you borrow so what they’re trying to do is come up
with rules where the loans will only be made to
people who can afford them in the first place which is like almost no one with the
loan that’s four hundred eight hundred percent if you’re dealing with the top spot
financially bill last thing you should ever do is go get a payday loan it only takes
you deeper into trouble I’m Clark Howard

2 comments on “Payday loans hurt finances more than they help”

  1. Clark Howard: Save More, Spend Less says:

    TRANSCRIPT: The federal government right now through the Financial Protection bureau is trying to write rules governing payday loans. Payday loans are loans where even if you don't have good credit or you have no credit you can go borrow money just because you have a job.
     
    The problem? Payday loans carry interest rates of usually 400 to 800%. They don't tell you that, but that's what they carry. Now the real, real, real problem with payday loans is they are ultra-short loans that when they come due, people can't pay them, and they roll them over into a new loan and then another and then another and then another.

    When you're done, you've ended up paying interest that is way, way, way greater than the amount of money you borrowed. So they are trying to come up with rules where the loans will only be made to people who can afford them in the first place, which is like almost no one, with a loan that's 400, 800%.

    If you're dealing with a tough spot financially, the last thing you should ever do is go get a payday loan. It only takes you deeper into trouble.

  2. Ryan Ploeger says:

    I would be shocked if a person that actually uses payday loans is watching this video. 1st they should save money by not paying for Internet.

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