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If No Payday Loans Then What?

direct lender payday loans replaced with savings

Why do people use payday loans? When an individual is out of cash, it is an easy way to get some money fast. The payday loan industry has taken a lot of grief over taking advantage of people in need of fast money. Most states have regulated short-term payday loans or banned them altogether. What would people do if there were no longer direct payday loan lenders?

Budget When There Are No Payday Loans

Without having direct online payday lender access, people would take a closer look at their budget. Having easy access to cash has kept many people from making necessary cutbacks. Defining wants versus needs would be a great way to start prioritizing expenses. Are premium movie channels worth keeping when one is behind on bills? Is dining out affordable when there is not enough money to pay the utilities? Taking a long hard look at where your money goes is tough and will require self-discipline. Tough decisions and follow-through are very do-able to cut back on expenses.

Financial Options Available

Food and clothing are good ways to cut back on spending. Make lists of needs and refrain from purchasing those wanted extras. Some people will choose to ask a family member or a good friend for a loan. Others may choose to be late on payments. Selling items in a garage sale or online market are options for extra cash. Pawnshops and car title loans are used for fast cash, but can risk an individual losing the collateral item for good if the loan is not paid back. Most options that people would choose from will have nothing to do with a financial institution. Banks and credit unions provide loans which do not offer fast cash, and they are much tougher to qualify.

Credit Cards Do Not Help

There are credit cards that can be used as well. Many people who would turn to payday loans have full balances already on their cards or need more than what is available. Credit cards do offer their cash advance option, but once again, if your balance is too high, the amount available to you may not be helpful.

Some employers may offer some help to employees. Borrowing against a future paycheck is an option, but some people want to avoid letting employers know that they are struggling financially.

The Beauty of Payday Loans

Direct payday loans lenders are not just fast money. The application process is simple. No explanation is needed as to why you need the money. The fact that it is a business relationship, there is no embarrassment. Many people are private with their finances, and failures are the last thing they want others to know. Risking to borrow from a friend or family member can ruin relationships if the loan is not paid back or payments are late. The tension created when combining money with personal relationships is a much higher price than any online payday loan fee. 

The More Borrowed, The More You Pay

State regulations of payday loans have created a competitive field for the direct payday loans lender. Those individuals who live in states where these loans are not allowed have to find other ways to get quick cash. Unfortunately, some lenders are not regulated by state guidelines and have crept into the playing field. People are saying that they are taking advantage of people’s financial situations. Be cautious of any lender willing to give you more than others. Sometimes, those lenders which sound too good to be true are just that. Also remember that the more money you borrow, the more interest you pay. 

Save, Save, and Save

Savings accounts are the best way to cure any need for outside cash from any source. Put away as much as you can each paycheck for emergencies later on. Once you borrow from that emergency fund, make sure you pay it back. When you pay it back, there are no interest and excess fees to pay. That’s a winning situation. The old fashioned way is the best. It’s the system that our grandparents used before payday loans and cash advances were around. You don’t buy something if you don’t have the money for it. You put money away so when the rainy day comes, you are ready. Don’t rely on payday loans or credit cards to bail you out of an emergency. Be ready. Be smart. Start saving. 

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