Perhaps predictably, the companies that lent him the money arent happy. Some of them have begun hounding Taylor with phone calls. Meanwhile, his debt is rising fast, growing higher every two weeks. Finally, the debts have ruined Taylor's credit, which he says will cause him to pay more for insurance and for his cell phone.
He says he feels guilty that he wasnt able to pay back the loans. These people did give me money. It aint their fault I couldnt manage it, he said. But he says the same thing that happened to him could happen to anyone. The payments are so high [for these types of loans], theres no way anyone could honestly pay them.
And anybody that dont make a whole lot of money, its gonna do them the same way.
Automatic Repayment. When you take out a payday loan, you hand over a signed check or other document that gives the lender permission to take money out of your bank account. If you dont show up to repay your loan as scheduled, the lender either cashes the check or withdraws the money from your account. Easy Renewals. If you know you cant afford to pay off your loan on time, you can come in before it comes due and renew it.
You pay a fee equal to the interest you bank rate of interest for personal loan and give yourself another two weeks to pay back your loan with another interest payment. Or, in states where thats not allowed, you can immediately take out a second loan to cover what you owe on the first one. Thats how so many users end up taking months to pay what started out as a two-week loan. Who Uses Payday Loans and Why. According to the 2012 Pew report, 12 million Americans take out payday loans each year.
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