No other forms of loans arouse as much controversy as payday loans popularized on our market. By opponents, they are sometimes called usury; their supporters point out that for many people it is the only available form of any loan.
Don’t be afraid to borrow, money is for people
“There were times when fools couldn’t hold on to money.”
Now it happens to everyone – such conclusions were reached long ago by Adlai Ewing Stevenson – American politician, activist of the Democratic Party. Therefore, the lack of creditworthiness and banks’ reluctance to grant loans should not cause a sense of complete financial exclusion. Loans offered by companies that are not banks, although they cost more, can be an alternative on the financial services market. However, potential clients of loan companies should know their pros and cons; know what they are choosing and what the consequences of using such “hot” money can be.
“Payday loans” – for a short time and at a high percentage
Why “payday loans” have a real annual interest rate at the level of several, sometimes even several thousand percent? Is it worth trying for such a loan?
Before we take it, we need to define our situation on the financial services market. The high price of “payday loans” does not come from nowhere – it is the result of a specific form of borrowing such money and the risk taken by loan companies. When taking a payday loan, we do not have to explain the previously unpaid loans; no one will ask us about income from employment and about the form of employment. Our age will not matter, the diseases we suffer from, even unclear marital status. Note – all this does not mean that the loan company will not be interested in our situation at all. At any time, he can check us in one of the BIGs (Economic Information Bureau), and even add us there as a debtor, if we do not repay the loan.
So what to do if we don’t have a permanent job, in BIK (Credit Information Bureau serviced by banks) we have uncertain papers (they have already been written a few years late in repayment of loans taken out long ago) and – as if that were not enough – we are ruining maintenance obligations? It is in such situations that the “payday loan” can be a tailor-made product, although expensive and extremely dangerous. Let’s use it only when we really need money and we know for sure that we will pay it back.
Pay off payday loans – delay will cost a lot
The layout is clear: they will lend us 1000 zlotys tomorrow, and we have to give them for example 1300 zlotys in a month (unfortunately it happens that the cost is higher). Simple conversion of “payday loans” can be tempting, but remember that these seemingly low consumer loans can ruin. Consumer organizations have taken “payday loans” to the goal by drawing attention to illegal clauses in contracts and their extremely high costs. The most dangerous for any debtor is the delay in paying the loan. Fees for prompts and any additional costs, sometimes increasing from week to week, can be dizzy. Suffice it to say that one of the companies offering quick loans for late payment can charge (in the form of handling costs for servicing overdue debt) almost PLN 100 a week! In this way, from an already expensive loan worth PLN 1,000, in a few months a debt will grow which we will not bear. So let’s remember – money is for people; let’s look for a better offer in the thicket of proposals, and pay back the money borrowed on time.