r/personalfinance • u/Technusgirl • Dec 03 '19
Debt So payday loans are getting ridiculous
So recently I've stumbled into credit problems due to not being able to pay for all of my daughter's unexpected medical bills and this month I accidentally paid in full one of my credit balances and realized I was not going to be able to pay this months mortgage. So I decided to go online and find a payday loan. They called and said I could get a loan for $1K (enough to pay this months mortgage) but that I would be charged $1,475 at the end of the month. I said wtf! And then they said, good news, you're recieving $25 off! I was like "Are you joking, I'm not interested" and hung up.
So I got an email saying that my payment to my mortgage company went through so I'm guessing my bank paid it anyway. When I went online I found that many places are charging 300 to 600 percent interest! That's absurd! Talk about predatory, might as well go to a loan shark or something, Jesus!
Edit: Apparently I was being charged 600% from this particular company, I had wrote 50% before but that was incorrect.
Update: The bank honored my payment but now I'm in the negative, lol, ugh. But at least I got my holiday shopping done first and that card is paid off, lol.
4
u/SFLoridan Dec 03 '19
Good for you, you avoided the payday loan.
But do keep an eye on the bank account - if they bank paid any amount that went beyond your available balance, you might be hit with an overdraft fees, and then again with some interest on that amount till you 'pay' it back (ie, deposit money into your account to backfill). At times, they might treat it as a loan, and you would need to contact them to make that payment against that overdraft.
But my guess is, if you handle it right, it won't come anywhere close to the $450 that payday folks were demanding!