Franklin County

Payday Loans = Costly Cash

            “I just need enough cash to tide me over until payday.”

            “Get cash until payday!…$100 or more…Fast.”

            The ads are everywhere and refer to payday loans – which come at a very high price. Check cashers, finance companies and others are making small, short-term, high-rate loans that go by a variety of names: payday loans, cash advance loans, or check advance loans.

            A cash advance loan secured by a personal check is very expensive credit. Let’s say you write a personal check for $115 to borrow $100 for up to 14 days. That’s a $15 finance charge and a whopping 391 percent APR!

            When you need credit:

• Shop carefully and look for the lowest APR.

• Make a realistic budget, avoid unnecessary purchases and build up some savings.

•  Ask your creditors for more time to pay your bills.

• Contact a nonprofit consumer credit counseling service.

Source:  Federal Trade Commission “Payday Loans = Costly Cash,” February 2000

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		Franklin County University of Missouri Extension Center FranklinCo@missouri.edu Last revised: 08/21/08