Payday loans can help a lot of people when they are in an emergency. The smart way is to take them out when you know that you can pay them back in a timely manner to avoid high interest rates.
Here is an example of how payday loans can help
A lot of us have been in this situation, and maybe you already have been which is why you are here.
Linda is a single mom living just outside of Minneapolis with her son and daughter. It’s been 4 years since Linda and her children moved out of a small apartment in the city and into their new suburban home. Finances have been tight as a result of the move but, not impossible to maintain. The minivan Linda drives is an older model that could use some work. She hopes it will hold together until she has a little extra cash on hand.
Linda drives 40 minutes to her job every morning which is a slightly long distance to commute every day. Linda’s salary is enough to make ends meet at home and, as the household’s only income, makes the drive vital.
Linda’s Monday starts with her morning routine of getting the kids ready for school and dropping them off on the way to work. She then heads for the highway and carefully merges. This is typical of the average workday except, today will be different.
Linda begins to see smoke poor out from under the minivan’s hood. She quickly pulls over to the shoulder to access the problem. When it’s safe she gets out and lifts the hood.
What a mess. There’s greenish fluid everywhere and the engine is giving off a lot of steam.
Linda calls her sister Kim for a ride and together they wait on the shoulder for the tow truck. The man who arrives with the truck hitches up the van and mentions it looks like a busted water pump. Linda knows her minivan is crucial for work. She can get a ride from friends and family for a couple days but, she needs dependable transportation.
As her sister drives her home, Linda wonders how she’s going to afford a water pump and labor. She debates whether she should ask to borrow some money from Kim. Before she can, Kim tries to sympathize with Linda by mentioning how she and her husband were dreading the bill from her son’s dentist in the coming week. Linda’s heart sinks. There was no way she can ask her sister for money after hearing that.
Linda decides she needs a loan. She goes to several banks. One decides the amount is too low to issue a loan and the other two review her credit score. Times were tough in Linda’s recent past with buying a new home and finalizing a divorce through a long process with her lawyer. She missed a number of payments which hurt her credit. The latter two banks deny Linda’s application.
Payday loans lend a hand
Linda gets a ride to work from Kim on Wednesday. During lunch she vents her frustration to her friend Philip. Philip suggests that Linda go for a payday loan. Linda gives Philip a skeptical look. She had always thought payday loans were a trap.
Philip tells Linda that he had used a payday loan before to cover some emergency dental work after a biking accident. He tells her that the key is finding the right lender and making sure you only borrow what you need and pay it back when promised. Payday loans can be a very useful service.
Phillip tells Linda that she should consider what she can afford to borrow that her next couple of paychecks would allow her to pay back. He also stresses the importance of finding a direct lender as third party lenders are prone to shenanigans like selling borrower info to other businesses. Using a direct lender will allow Linda to borrow without harassment from telemarketers and spam emails later.
Linda needs to find a way to pay to get her minivan fixed. When Phillip drops her off at her home, she decides to do some online research on payday loans. Once she collects more information, double checks her finances, and calculates the amount she needs from her next couple paychecks, Linda realizes that a payday loan may be exactly what she needs. She has steady employment, a social security number that validates her citizenship (or at least permanent U.S. residence), and the direct lender Linda has chosen won’t be holding her FICO credit score against her.
It’s Thursday and Linda is amazed. The application she filled out online last night has been approved and the money has been auto deposited into her checking account. She’s now calling her mechanic, telling him to go ahead with the repairs. She sees Kim pulling up in front of the house to pick her and the kids up. Linda can’t wait to tell Kim and Phillip the good news.