The cost of everything seems to be going up these days and people are finding that their household budgets are becoming less and less. Yes, the cost of living is soaring, and in tough times people look to options they may have never considered, such as payday loans. Some people may even rely on payday loans to cover monthly expenses on a regular basis.
Warning against relying on payday loans consistently
Liz Chadwick, Chief Executive of DAWN Advice gives warnings for those relying on payday loans to cover monthly expenses on a regular basis. Research by Citizens Advice revealed that the amount of people currently facing financial hardships due to payday loans has more than quadrupled in the past two years.
Some say the disadvantages outweigh the advantages
The advantages of payday loans cannot be denied. Payday loans are easily available all across the country and no credit checks are required in order to obtain them. The money is easily deposited into a personal checking account once approved. Access to such easy money seems to be too much to turn down for some people who need cash now.
Not to be looked at as a short-term credit
Consumer advocacy groups warn that people who decide to use payday loans should not look at them as short-term credit. People should resort to payday loans only if they feel they have exhausted any other options available. These warnings come because so many people end up missing repayment deadlines and then their debt rolls over. The interest rates can grow until a person is unable to keep up with paying anymore.
How payday loans should be regarded
Payday loans are meant to be used for people who are trying to make ends meet until they receive their next paycheck. Advocacy groups advise people to manage these loans very carefully if they feel they must utilize them, and be sure not to become trapped in a vicious cycle of over relying on them.