Just recently the government decided to crack down on loan lenders that offered guaranteed payday loans no debit card. This followed after a lot of complaints with this sort of financial product. The main complaint is that fees for the loan were quite high. Some experts say that taking out this form of loan is like borrowing money with an annual interest of 800%. Yes, that was not a mistake, its 800%. Many borrowers are more than willing to shoulder the unusually high fees because of various reasons.
First of all, as the loan is generally a short term one, borrowers don’t really realize the exorbitant amount of the interest that they are paying for. They only realize that when they are forced to extend the loan the fees pile up.
Easy to Get
The main attraction of this loan is the ease with which you can get it. You don’t have to spend a great amount of time in waiting for the approval or denial of your loan application. This was even enhanced further with the use of the Internet. Now payday companies are offering application forms on their websites. All that you have to do is to write down all of the information needed.
Funds Sent the Next Business Day
Approval can be processed within the same day; sometimes it would only take 1 hour for the whole process to be finished. The ease by which one can get this loan is an attraction to a lot of people, especially the ones who are having financial difficulties already. They see guaranteed payday loans no debit card as the answer to their problems.
In reality however it could just lead to more headaches. The high fees can become so crippling that you would soon be forced to borrow month after month. The solution could then become a nightmare.
The Consumer Financial Protection Bureau, the federal government agency tasked with protecting borrowers from lenders with unsound practices, have been urged to look into the practice of payday loan lenders. It has been pointed out that the ease of which this kind of loan can be obtained is being used by some companies as a bait in order to lure unwitting borrowers into long term financial difficulties.
While these kinds of loans play a crucial role in the financial marketplace, the way that they are being used and abused right now might actually be causing more harm to borrowers than good.
Beware of Personal Loans
If you ever found yourself in situation where you thought that this sort of loan is going to be beneficial for you then you should beware. You might soon find yourself being in a debt cycle where you will be forced to take out loans in order to pay for the earlier ones. You should take action right away in order to avert such a situation. Try to increase your income or find some other means of getting some funds other than a loan.