Borrowing Money in a Pinch

No one resorts to borrowing money from predatory lenders because they want to. Instead, the people lined up at neighborhood convenience stores to sign for payday loans and the ones scrolling through “rent a bank” loan listings on their outdated phones with cracked screens they cannot afford to fix are doing it because bill due dates are approaching, and the borrowers have no friends or relatives who can afford to float them some money until payday, nor can they qualify for a conventional unsecured personal loan from a bank. Their options are payday loans and the next worst thing to payday loans, but how bad are those pay loan alternatives? Some of the financial products available to borrowers with low credit scores and low income are more predatory than others, but sometimes financial necessity requires you to choose among subpar options. For help strategizing about which financial products are available to you with your current credit score and about how to improve your creditworthiness, contact a Boca Raton debt lawyer.

If Not Payday Loans, Then What?

If you wonder why payday loans exist, you have probably never been in a truly desperate financial situation. People borrow payday loans because you can get them even if your credit is bad, the funds are available almost immediately, and the principal balance is just enough to cover the bills that are due before your next paycheck arrives. Of course, the fees are astronomical, and the repayment terms are so short that you will probably have to spend your entire paycheck repaying the payday loan, so you will have to borrow another payday loan to cover the next round of bills.

The good news is that there are other options for borrowing when your credit score is so unimpressive that you worry that payday loans are your only choice:

• Payday alternative loans – If you are a member of a credit union, you can get a loan of up to $2,000. The repayment terms are short, like with payday loans, but the interest rates are around 28 percent.
• Low credit score loans – These are like conventional personal loans, except that the interest rates are higher because the borrowers’ credit scores are low.
• Auto title loans – These are preferable to payday loans, because the repayment terms are long. They are just as expensive in the long run. Many auto title loan borrowers are seniors on a fixed income who need cash, so they borrow an auto title loan and spend the rest of their lives making payments on it, without making much of a dent in the principal.

If you are resorting to desperate measures to borrow money, then perhaps it is time to get off the borrowing and repayment treadmill. Filing for bankruptcy or settling your debts could bring you the debt relief you need.

Work With a Debt Lawyer About Avoiding Predatory Loans

A South Florida debt lawyer can help you find a path to debt relief so you do not have to rely on predatory loans.  Contact Nowack & Olson, PLLC in Plantation, Florida to discuss your case.

Source:

finance.yahoo.com/news/emergency-loan-bad-credit-050028875.html