Quick Tip: Payday loans can cost more than expected

Payday loans may sound like an easy fix but they could leave you swimming in debt.

Here are some reasons why you need to be more careful than ever:

  • The industry will now have less regulations, so borrowers need to be vigilant about the terms of their loan.

  • When using a payday lender, make sure you understand the annual interest rate. They've run as high as 400 percent.

  • Always try to negotiate the interest rate and payment schedule.

  • Most of these loans are designed to last a couple weeks. So make sure you can repay the loan in time and not get stuck having to take out another loan to pay off the first. That can drive you into ballooning debt.
  • Copyright © 2020 WLS-TV. All Rights Reserved.