I have written before about the dangers of payday loans. The money seems “easy” when cash is tight. But it is an expensive way of borrowing and you may find yourself in a hole you cannot dig yourself out of.
Last week I met with Joan (not her real name) at my Chatham office. Several months ago, her hours were cut back at work. At the middle of the month she found that she didn’t have enough money to pay her visa bill, but she knew she would get paid again in 2 weeks. She then went to payloan A to borrow $200. The problem is that after she added fees and administrative costs, 2 weeks later she would have to pay back substantially more than $200. Her paycheque arrived, her hours were still cut back and now she didn’t have enough to pay back payday loan A. She then went to payday loan B and borrowed enough to pay back payday loan A.
This continued until 4 months later she came to see me. By that time she had $3,000 with 5 different payday loan companies. She was worried about what to do. She is now off work and the stress of knowing she had these payday loans was overwhelming her.
Her total debt was small compared to the average, but when you are running out of money each month to pay the bills, does it really matter if your debt is $10,000 or $100,000?
Even though she didn’t have any wages that could be garnisheed Joan decided to file for bankruptcy. That way she can finally emerge from the payday loan trap and begin her debt free future.
If you find yourself trapped by payday loans, give me a call at 519-351-2323 and let me help you.
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