Myths of Payday loans
Payday loans are seemingly small amounts of money one borrows for furnishing their needs that they expect to pay off by their next pay check. These are insecure loans given without any guarantee or collateral and generally taken by people who either have a monthly wage system of earning or get an allowance. Something like separation allowances of pension money. This is a relatively new method of getting money and as such not very widely popularized. So, there are many myths of payload loans. Here are 9 myths about payday loans that one should know about.
- Creates a “Cycle of Debt”
A general notion is that people getting a payday loans once need to be getting them regularly. This is so not true. Someone gets a payday loan generally at the time of emergency. Even if the situation arises, it is a personal reason and not company motives.
- Bad customer service
It is said that the employees of service firm are taught to first trap the person in a sugar syrup trap and then, once the loan is taken they turn a deaf ear. This is just stereotyping a whole bunch of people. It may not be true for various companies.
- Hard repayment policies
The payday loan firms are accused of using coercive repayment methods. Well, everyone in the lending business has to be a bit strict. Moreover all terms and conditions are explained to the customer beforehand and only then a loan is given.
- Do not follow the government norms
All payday loans are and should be government affiliated and hence follow rules. One should check the feasibility of this before borrowing from a particular firm.
- Account not safe in their hands
While going for Online Payday loans people are scared for the safety of their bank accounts. Well, same can be true about all e-transactions. So, if you have known all about the site and are a pro e-banker, you have nothing to worry.
- Adds extra charges
The Payday loans adds charges into one’s account even after the money has been paid. This is a super myth as the firm has no connection with you what so ever after you have paid back the borrowed money and interest.
- Way to get out of situation you should never have been
this is something that has to be dealt personally. But not always are the payday loans used to furnish these. They can help so many in time of medical emergency.
The money from payday loans can also go for shady dealings. Well this is also stereotyping and not seeing the positive and helpful side of it.
- Overdraft receipt versus payday loans.
People think that giving a postdated check is better than giving the actual money. This can be dangerous as you know how much you are borrowing. But once the amount is cut, you can’t be sure how much was the extra money charged.