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Definitely not, where is the free market here. Let's look at the current info on hand. The average family, in low income America. Already has an issue, their low income. Then there's the strong possibility, the living from pay check to pay check. If you're already living from pay check to pay check, why would you consider putting yourself all the way in the whole. Budgeting in these times, it's even harder for the middle incomers, let along the low ones. Studies show, if the average household income for the lowest income, is less than 20,000. Taxes take an average of what ever the states income rate is,then you factor in federal,Medicare. What does that leave the single mother of two with. With the interest rate along, would take her maybe 6months or more to pay it off. From what I read, on some of the Internet sites. If the borrower, makes the loan for say 300.00 dollars. The rate on some off the sites,requires the repayment of 475.00, if paying in full.

Knowing in the first place, that's why the individual came to borrow the money. The individual, is not understanding the true value of it. Because there is a catch 22, if you can't make the full payment by, your scheduled pay day. They got you, buy telling the borrower, you can on pay the interest portion. Of course the interest portion, maybe an mere 75.00 or 50.00. It all depends on the company,and the lending agreement you signed.
Now that doesn't end there, you're now responsible for the repayment of the original and not least the new interest.

You're saying to yourself, whom ever is reading this, is she right or crazy. Nope, neither of the two. The truth is, I read a contract with similar information in it, because my girl friend was having a rough patch, 2yrs ago. She needed a quick fix, the quickie turned out to be a nightmare. The payroll department where she works,had a problem with the newly installed system. Her direct deposit, which by the way is one of the requirements in getting the payday loan. It didn't deposit her paycheck, payroll had to disburse hand written ones. Not only did she incur some heavy cost from this. She was required, to now use Western Unions, Quick Collect payment process, she had to pay the fees associated with sending a payment.

After listening,to her on the phone with the payday loan company. They spared no mercy, they told her, this would have to be done for the next 4 payments. Are you ready readers? these where just the int rest payments.
After all the costly fees she incurred, she couldn't afford to start paying the original loan down yet. Finally after everything was resolved, with the payroll department. The loans resumed to it's original transactions, and she was able to pay them off in 8 months. Are you counting out there, I did and it was scary. Oh! Did I neglected to tell you it was biweekly payments at 65.00 dollars interest and 16.95 Western Union Quick Collect Payments,and then the interest plus 50.00 dollar payments biweekly.

Now that's insufficient funding. So whom ever came up with this bright idea, really had a scheme in mind. To top it off, some states allow them to collect on the debt. Including the garnishment of hard earn wages.
Remember, quick fixes are not permanent ones. It adds to you problems, not solve them because they see you coming.

Consumers read the fine print,it's more than you bargained for.

Learn more about this author, Samantha Brown.
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