Personal Finance

Online Payday Loans

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  • Mar 11th, 2014 11:40 pm
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Newbie
Oct 31, 2013
12 posts
1 upvote

Online Payday Loans

What are Online Payday Loans? And what are its benefits?
16 replies
Sr. Member
Dec 26, 2013
668 posts
59 upvotes
Money Mart and the Cash Store and any other pay day loan place but online. So no one will see you.

Still very expensive and a stupid way to go.
Deal Addict
Jan 19, 2011
3208 posts
1526 upvotes
jaynorth wrote: What are Online Payday Loans?
A form of usery poorly disguised as a legitimate loan service, that due to their nature of being oppressive and even financially devastating to users, must be actively and aggressively managed by government statute.
jaynorth wrote: And what are its benefits?
There are none, only undesireable and potentially financially devastating consequences.
"The truth is incontrovertible, malice may attack it, ignorance may deride it, but in the end; there it is."
Just a guy who dabbles in lots of stuff learning along the way. I do have opinions, and readily share them!
Deal Fanatic
User avatar
Feb 19, 2010
6237 posts
2992 upvotes
Agreed with the previous two posts.

Ironically, payday loans are utilized by the people that can least afford to use them and only serve to perpetuate a cycle that one should not aspire to in the first place. Ditto for income tax cash back schemes.
Sr. Member
Mar 4, 2007
739 posts
734 upvotes
Halifax
Conquistador wrote: Agreed with the previous two posts.

Ironically, payday loans are utilized by the people that can least afford to use them and only serve to perpetuate a cycle that one should not aspire to in the first place. Ditto for income tax cash back schemes.
I used to work in payroll and so I could see all my friend's paycheques. A buddy of mine worked in IT and made DOUBLE what I did and yet 2 days after payday I'd see him going to the payday loan place....
Deal Addict
Jul 28, 2003
1879 posts
55 upvotes
Toronto
If you are struggling financially and end up using these Payday loans for the maximum you can obtain, you will be even more at a struggle when you get stuck in the vicious cycle.

Example:

Bi-Weekly Net Income: $1000
Payday loan of $800 borrowed at $20/$100 (fees of $160).
Net total after loan: $1800 (not including the fees).

Sounds nice, right? Wrong. Here's where you get it long and hard:

Next payday comes along.

Bi-Weekly Income: $1000
Repayment to Payday loan: $800 + 160 = $960
Net total after repaying the loan: $40.

Unless you were given a lump sum of money, or can get help financially elsewhere, you're screwed. You are now forced to get another payday loan of $800. This can end up going on and on, and your bi-weekly net income of $1000 has now been slashed to $840.

I've gone through this cycle a few years ago, and it lasted for months until I could break free from it. The short-term benefit of having a larger amount of cash on the first week was definitely not worth the consequences to my income thereafter.
Newbie
User avatar
Apr 8, 2013
41 posts
5 upvotes
Winnipeg
Conquistador wrote: Agreed with the previous two posts.

Ironically, payday loans are utilized by the people that can least afford to use them and only serve to perpetuate a cycle that one should not aspire to in the first place. Ditto for income tax cash back schemes.
Agreed, it's predatory.
Deal Fanatic
Mar 24, 2008
6278 posts
2753 upvotes
Toronto
Conquistador wrote: Agreed with the previous two posts.

Ironically, payday loans are utilized by the people that can least afford to use them and only serve to perpetuate a cycle that one should not aspire to in the first place. Ditto for income tax cash back schemes.
Do expand on the bolded part, does it have to do with additional fees being tacked on? I have never used either of these services but I am curious about the tax refunds offered by companies like H&R Block.
Moderator
User avatar
Aug 20, 2009
9827 posts
5935 upvotes
There are no benefits to payday loans, they are one step removed from having a loan shark with the mob. Get some envelope budgeting software like YNAB instead.
Deal Addict
Jan 19, 2011
3208 posts
1526 upvotes
ksgill wrote: Do expand on the bolded part, does it have to do with additional fees being tacked on? I have never used either of these services but I am curious about the tax refunds offered by companies like H&R Block.
I would presume Conquistador is referring to the egregious fees charged by Income tax firms to provide the client a speedy and immediate refund, versus waiting, or paying a lower cost professional, or to simply prepare a return oneself and wait for the return.

Although nowhere as predatory as payday loan companies, firms like HR block and the like allow clients to get 'hooked' on needing a speedy return come tax time, and make them pay exorbitant amounts to get that.

my apologies in advance, I am doing filing and other work in the office, and am taking numerous coffee breaks close to the computer! lol
"The truth is incontrovertible, malice may attack it, ignorance may deride it, but in the end; there it is."
Just a guy who dabbles in lots of stuff learning along the way. I do have opinions, and readily share them!
Sr. Member
Dec 16, 2004
860 posts
169 upvotes
Toronto
Unfortunately, their marketing or signage or whatever advertising they use is working. My 8 year old son asked me how they work the other day and I have no idea how he even heard of them - I kind of freaked out on him but at least now he knows to never ever use them!
Deal Fanatic
User avatar
Feb 19, 2010
6237 posts
2992 upvotes
ksgill wrote: Do expand on the bolded part, does it have to do with additional fees being tacked on? I have never used either of these services but I am curious about the tax refunds offered by companies like H&R Block.
fieldhousehandyman wrote: I would presume Conquistador is referring to the egregious fees charged by Income tax firms to provide the client a speedy and immediate refund, versus waiting, or paying a lower cost professional, or to simply prepare a return oneself and wait for the return.

Although nowhere as predatory as payday loan companies, firms like HR block and the like allow clients to get 'hooked' on needing a speedy return come tax time, and make them pay exorbitant amounts to get that.

my apologies in advance, I am doing filing and other work in the office, and am taking numerous coffee breaks close to the computer! lol
Precisely.

CRA seems to be getting quicker at initial assessments and refunds so why pay a fixed fee plus percentage of refund to get it in your hands today when you can get the full amount due to you in, what, two or three weeks?
Deal Addict
May 2, 2007
3013 posts
270 upvotes
Kingston
Easyhome loans charge after all the fee's is 104% interest.
Sr. Member
Dec 26, 2013
668 posts
59 upvotes
Conquistador wrote: Precisely.

CRA seems to be getting quicker at initial assessments and refunds so why pay a fixed fee plus percentage of refund to get it in your hands today when you can get the full amount due to you in, what, two or three weeks?
Because you want some food to eat, some booze and some drugs. Duh.
Member
Mar 31, 2013
396 posts
84 upvotes
Toronto
There are clearly benefits to being able to get money quickly, even if you have very poor credit. Obviously it is not smart to use these unless in case of an emergency.
Deal Addict
May 2, 2007
3013 posts
270 upvotes
Kingston
I'd only use this if I was beyond broke and needed food.

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