This Article is About
payday loan
pile of money
catchy title
checking account
short time
traps
Online Payday Loan Traps, Have You Been Caught?
Join 1000's of Authors at StreetArticles Today!

Online Payday Loan Traps, Have You Been Caught?

Kind of a catchy title, "Online Payday Loan Traps, Have You Been Caught?" unless you have been caught. There are traps to be watched out for when using these companies that will make them very wealthy and you very poor, all in a very short time.

My story today is about a man who desperately needed money. He went online and found one of these companies that would deposit up to $500.00 into his checking account withing 24 hours as long as he made $800.00 a month, even if he had bad or no credit. Too good to be true, right? It was.

He was so exited about getting this money he really did not pay attention to what he was being told, and missed the part where the loan would be set up for 36 months at an incredible interest rate. They would take the payments out monthly for the next 36 months, and this is how he got set up to get caught in a payday loan trap.

This, like many other stories involving these companies, gets very ugly. By the time man got out from under this mess. He ended up not being able to cover the payments and went into default with the company, who would not stop trying to take out his payments form his bank.

This in turn crashed his bank account so bad he had to close it, but could not because the bank needed a zero balance to close the account, and this loan company kept banging it for their payment. This is not going well for this man by now, and he is starting to get harassing calls at work and at home from the loan company threatening to take him to court. All of his references are getting calls asking where to find him, and life is just not very pleasant.

By the time he got this all figured out and everybody paid back, he had spent nearly $7500.00. All he needed to do was pay attention when he was applying for this loan and he could have avoided all this ruckus, and saved a whole pile of money.

See, they did not bother to tell him very loudly as hew was applying that if he called them 3 business days before his payment was due he could have paid the whole loan amount off, consisting of only one months interest and the loan fee, instead of making all 36 payments. He could have knocked this loan out right away and been done with it instead of ending up at a payday loan consolidation company.

In hindsight, he now knows by learning the hard way that picking the right payday loan and understanding all the terms of that loan is imperative to avoiding the payday loan trap!

Please feel free to share this article and leave any questions and comments below!


Street Talk

Sherry B.  

Wow! That is terrible how these places take advantage of people. They sure make quite a profit out of people not paying attention to the tiniest details!

Reply
  about 6 years ago

They do at that! Thanks for reading Sherry!

Reply
  about 6 years ago

$7000 for a $500 loan sounds like a really good deal...for the lender. It's always that itty bitty fine print that gets in the way, isn't it?

Reply
  about 6 years ago

It is a great deal for the loan company.... :)

Reply
  about 6 years ago

Great image...it says it all....nice Shawn

Reply
  about 6 years ago

It sure does Tim!

Reply
  about 6 years ago
Paul7  

Predators love the fine line. I've never taken out a payday loan, but there's one thing that I've learned by experience to watch for. 'You agree to indemnify... against misrepresentation...'

Reply
  about 6 years ago

Agreed!

Reply
  about 6 years ago

It's sad to see how innocent unsuspecting people get taken advantage of. Knowledge is everything! Great article!

Reply
  about 6 years ago

It sure is.

Reply
  about 6 years ago

It's hard for me to fathom that people really get involved in these type of scams. I'm with Pat. If I can't write the check I don't buy it

Reply
  about 6 years ago

Good way to be John!

Reply
  about 6 years ago

Bad for the borrower, but good for the lender. There is no good loans if you ask me. Well I do have a mortgage, but we own every vehicle on the place. I don't drive a car that I can't afford in fact one is a 86 Ford F250 and the other is a 1981 Subaru. These two vehicles have served us well for years and guess what, we paid cash for them when we bought them used. Something that is not in the norm any more for sure. Great article. Thanks for sharing and caring.

Reply
  about 6 years ago

I am pretty much the same way with cars. I have owned a few newer ones but I agree, paid for sounds oh so good!

Reply
  about 6 years ago

i got caught in one of those bad boys when i was younger and it was ugly because like you said i didn't read the fine print - nowi always go back to my father's advice on credit - if you can't pay for it - you can't afford it

Reply
  about 6 years ago

Your father was a very wise man Stephen

Reply
  about 6 years ago

Great article. I have seen reports of interest charges of 2049% can you imagine - awful Regards Keith

Reply
  about 6 years ago

It can get real ugly!

Reply
  about 6 years ago
Dom Wells  

I think 2049% is one of the lower ones!

Reply
  about 6 years ago

It is amazing how bad it can get with these.

  
  about 6 years ago

Scams can be fatal, indeed!

Reply
  about 6 years ago

Yes they can!

Reply
  about 6 years ago
You May Also Like
Eliminating Payday Loan Debt - People Targeted for Scam
The documentation that businesses and databases maintain in the modern era is something that many people fear. Many of the things that every person does on a regular basis are documented and used in order to sell products or services. Sometimes the data is even used in order to scam…
By: David Schmidt in  Finance  >  Debt Management   Jul 18, 2012  
8
  Likes: 7

Payday Loan Laws In Oregon
As one of the most progressive states in the United States of America, Oregon has hit the nail on the head for payday loan laws. Their protection has made sure that many of the consumers in the state are not only protected from predatory lenders, but are also protected from…
By: David Schmidt in  Finance  >  Debt Consolidation   Oct 02, 2012  
7
  Likes: 8

Payday Loan Hell
In the Christian religion, and some other Judeo-Christian religions, the concept of “hell” has taken root. Many people fear hell in the afterlife and therefore maintain good relations while they are living. However, the people who are suffering with families every day are in their own type of hell on…
By: David Schmidt in  Finance  >  Debt Consolidation   Aug 30, 2012  
28
  Likes: 13

How Do I Get Out Of This Payday Loan Trap?
Working with payday loan clients, I have heard a lot of sad stories in my day. Without a doubt the worst stories are from parents who have responsibilities and have still fallen into the payday loan trap. I dread hearing “how do I get out of this payday loan trap?”…
By: David Schmidt in  Finance  >  Debt Management   Nov 02, 2012  
4
  Likes: 7

Missouri Getting Help With Payday Loan Debts
It is a well known fact that the payday loan industry funnels millions of dollars into the campaign treasure chests for many different Congress men and women. In fact, one of the states that has the biggest industry of payday lenders is the state of Missouri. They have been able…
By: David Schmidt in  Finance  >  Debt Management   Aug 10, 2012  
13
  Likes: 11

How Can I Get Out Of Payday Loan Debt?
In the consolidation business you hear a lot of people asking “how can I get out of payday loan debt?” and the answer is always the same: through hard work! Still, there are some simple tricks that you can use in order to get rid of this debt. This is…
By: David Schmidt in  Finance  >  Debt Consolidation   Oct 31, 2012  
2
  Likes: 3

Gift Giving And Payday Loan Debt
Although it may sound like a stretch to discuss giving gifts and payday loan debt in the same sentence, the two can be very closely related. Birthdays and holidays can be a huge financial drain on resources during some of the most crucial parts of the year. Right when the…
By: David Schmidt in  Finance  >  Debt Consolidation   Jun 26, 2012  
9
  Likes: 5

Payday Loan Laws In Florida
If you are thinking of getting a payday loan and you live in this state you need to check out the payday loan laws in Florida before you take the plunge. They are very much lender friendly and are set up around existing lender laws so they can legally do…
By:  in  Finance  >  Debt Consolidation   Oct 29, 2012  
13
  Likes: 6

How to Get Rid Of A Payday Loan Fast
Anyone who has gotten into payday loan debt is aware of the negative affects it can have. Not only is credit destroyed, but stress can become an ever-present problem in your life that simply does not go away. The additional interest rates will continue to plague you and your family…
By: David Schmidt in  Finance  >  Debt Management   Dec 08, 2012  
5
  Likes: 5

Help Payday Loan Debt
There are many ways that you can help payday loan debt, but the first is to avoid it altogether. This might sound counter intuitive, but we are going to use this article to help you to avoid debt altogether so that you never have to worry about this crushing problem.…
By: David Schmidt in  Finance  >  Debt Consolidation   Jan 31, 2013  
2
  Likes: 4

Payday Loan Help In New York
Millions of men and women have been affected by the recession in 2008, but that does not mean that debt and other issues have to be a major concern. The people of New York were especially hard hit due to the fact that they were in the financial capital of…
By: David Schmidt in  Finance  >  Debt Management   Sep 28, 2012  
3
  Likes: 7

Help With Payday Loan Debts
Men and women are increasingly looking at bank and payday loan statements in bewilderment. Almost no other industry could get away with the type of abuse that they are able to get away with when it comes to interest rate payments. These types of payments are nearly impossible to pay…
By: David Schmidt in  Finance  >  Debt Management   Oct 02, 2012  
5
  Likes: 6

Virginia Payday Loan Laws
As one of the first states in the nation, Virginia is always looked to as one of the examples when they create their laws. In the case of payday loans, this is also the case. Virginia payday loan laws are not very complicated to understand, but many people do not…
By: David Schmidt in  Finance  >  Debt Management   Oct 05, 2012  
6
  Likes: 7

Payday Loan Debt Help – How to Rid Yourself Of Those Loans
The American economy has been so poor for the past four years that many families are having serious trouble maintaining a family. There are many Americans who have been unable to keep their job through this downtown and the unemployment rate does not seem to be decreasing much every month.…
By: David Schmidt in  Finance  >  Debt Consolidation   Jul 21, 2012  
12
  Likes: 8

Payday Loan Help In California
One of the main consequences of the 2008 recession has been a crash in home values across the nation. In California, this is definitely the case and there are still traces of this problem. Even today, the prices for homes being sold in the state are far below what they…
By: David Schmidt in  Finance  >  Debt Consolidation   Sep 28, 2012  
7
  Likes: 6

Article Views: 2022    Report this Article