Quick Ways to Squander Cash: Avoiding Negative Lending Outlets
When you need to borrow money in a desperate situation, it is easy to make quick, and not very well thought out, decisions. Typically these decisions include a quick fix loan that carries a high interest rate, astronomical fees and terms that may make it impossible for you to ever pay it back. There are always better ways to get out of a bad financial situation. Even borrowing money from family or friends is better than getting into bed with a negative lending situation. Here are some of the worst ways to waste your money with lending partners:
1) PayDay Loans – Is pay day just too far away, and the bills are already extremely late. If you don’t take care of it today, the lights will be turned off, and late fees will be attached to multiple credit card bills. In comes the payday loan. Payday loans allow you to take in your last paystub and get a loan for up to that amount. However, they typically want the money back rather quickly, and the loans always carry with them ridiculously high interest rates that can turn the loan into double or even triple the amount by the time you are able to pay it back.
2) Cash Advances from credit cards – Payment processing services and credit card companies want you to take out cash advances. Why? Because they can charge a ridiculous amount of interest, some charge up to 25%, and add on extra fees as they please. They know you need the money and they are more than willing to give it to you under these extreme terms. Their merchant account services will pass on the fees to them, so they will surely pass on the fees to you.
3) Title Loans – This basically means putting up your car for collateral to get the cash you need. The problem is, some of these places charge as much as 125% annual interest. How will you possibly ever afford to get your car back? You will owe more than your next paycheck before you even get it?
Have you ever used a quick fix loan? How did it work out for you? Comment below and share your thoughts!