4 Myths About 100 Dollar Payday Loans
Taking payday loans seems to be the norm for handling financial distress. However, most of those applying for the loans do so with little knowledge.
Let’s look at four myths about 100 dollar payday loans you may or may not have heard...
1. Consumers Have No Other Options but Payday Loans for Their Emergencies Hence Worse Off Without Them
The payday loans industry has fixed the minds of consumers into believing they do not have options for handling their emergency needs. The loans offer a quick fix to financial issues but no other options. That’s how the companies make their profits.
There are available options to consider apart from taking payday loans. For instance, you can cut back on expenses and only work with what you need, plan adequately with the available money, and set aside some for emergencies. Delaying payment of some bills and borrowing cash from your family members is also a way to get by the financial predicaments. Some bills do not come with a ‘have to’ notice and can surely accept a slight delay. You can take advantage of such bills and sort out what needs financial attention at hand.
So, the consumers are not worse off without payday loans and sure have other options to consider. The myth is most likely imposed on clients for the industry’s benefit and keeps consumers glued to the borrowing cycle.
2. 100 Dollar Payday Loans Are Only Used to Cover Emergencies
Since the emergency need is the main point of reference, it does not mean that payday loans are not only for emergencies but only about 16% of the loans are used for actual emergencies. Most of those applying for the loans take care of other bills such as food and groceries.
Taking payday loans to manage regular expenses is not a smart financial move since, on average, about $375 is taken every year and accrues interest of up to $520. This means the borrower will be in debt for almost half the year.
If you need a loan urgently and cannot wait it out or have other choices, you can access payday loans from companies with rates worth considering, such as Viva Payday Loans, and borrow 100 dollar loan now.
3. Restricting Storefront Payday Lenders Increases Online 100 Dollar Payday Loan Access
Most states regulate operations of storefront payday loan companies, while some do not permit their businesses at all. The main cause of concern with the conflicting ideas is whether the ban increases their online activities or puts them under control.
Most are confident that online engagements increase when restrictions are imposed on storefront lenders. However, it is simply a myth since about 95% of potential borrowers with no access to the storefronts decide not to apply for the loan, leaving only 5% to the loans.
Restricting the payday loan storefronts will not likely increase their online engagements, but instead, there may be a decline in numbers in the borrowing cycle.
4. 100 Dollar Payday Loans Are More Beneficial to the Borrower
Taking a payday loan to finance a pressing need may seem to be a smart move or beneficial to the borrower at the moment. Nevertheless, it is not, and the claims are myths aimed at attracting more clients in the long run.
The fact is acquiring payday loans is likely to leave the borrower more financially desperate than they were initially and will be prompted to take another after clearing that which was due.
The only side benefiting is the company as the clients strive to pay those exorbitant interests within the set time. Failure to make timely payments attracts more penalties and exerts more pressure on what you already have to deal with.
Therefore, payday loans are not beneficial to consumers. With recurrent borrowing, one is likely to get into accumulated debts and more financial frustration than they would have been supposing they waited out their emergency.
Bottom Line
Myths on the common 100 dollar payday loans often portray them as the best financial solutions. After weighing and considering other options, you will notice payday loans are not as advertised. There are plenty of other factors at play.