My Payday Advance is yet another tribal payday lending operation. If you spent any time at all reading these pages you've learned at this point that it's an uphill battle to try to get people to resist these companies.
After the credit market was crushed and contracted terribly after the September 2008 crash and following crisis, we were left with a society that had basically discontinued lending money. Let's be specific here, there were no longer any loans being issued to individuals, meanwhile the banks were receiving a great big pile of loans through all sorts of providers, many of those sources were government agencies or the U.S. Congress itself.
For the rest of us there was very little in the way of funds to borrow.
That's where a company like My Payday Advance rises from the ashes, like some high-powered money devouring phoenix. Without any credit sources of any type, people started flocking to My Payday Advance (and roughly 100 other tribal lenders of all sorts) to get even the small amount of credit that could be had with the tribal payday loans they offered.
The problem is that doesn't provide any degree of help for all those people who were looking for help or who are continuing to look for credit. With small loans averaging somewhere around $500 the purpose and point to getting these loans is just missing to me? What exactly am I missing here? You get a loan for $500 which you'll get to keep in your hands for about 15 days. That's about 360 hours total. The loan then comes due and you have two choices:
The customer can repay the loan in full, plus the 30% interest rate attached to the loan (that's the finance fee) so you'll be paying My Payday Advance about $650. That's $150 more than what the customer just borrowed from the firm only 15 days earlier.
The second choice the customer has is to borrow the money again. That means the loan will be rolled over. The customer will still have to part with the $150 as a finance charge but they don't have to repay that big amount (the $650) until their next pay period. But there's a good chance they won't want to (or will not be able to) repay the full amount on that next pay period, either. Or the next. Or the next one after that. See the cycle that develops here? The customer is going to be paying the $150 finance charge every 14 calendar days and not make any progress at all against the original (the principal) amount.
My Payday Advance is just another tribal payday lender and they are not a company I would do business with, even if I didn't have any other source of credit. And besides, things haven't come to that yet. There are some halfway decent tribal lenders, such as Mobiloans and Plain Green Loans, both of whom are very active lenders and who have better policies in place when compared to My Payday Advance.
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