Although payday loan companies are meant to help people successfully get through a difficult situation, unfortunately there are many that take advantage of people in desperate situations. Many payday loan companies are illegitimate or have been caught grabbing cash from their customers’ accounts without permission. Still other shady payday loan companies are known for threatening customers or rolling over customer debts for as many as a dozen times, racking up some serious interest rates.
Some Payday Loan Companies Doing More Harm than Good?
Those people who have been unlucky enough to obtain their payday loans from some of the worst companies existing today have been put in numerous bad situations. Many were unable to buy food or pay their bills while continuing to struggle with substantial debts. That is because many companies forget that the primary goal of a payday loan lender is to offer financial support for people in need so that they can pay their bills.
Sinking in Rollover Debt caused by Payday Loans?
These are the same type of loan companies who were found reaching into their customers’ bank accounts without permission, leaving their customers struggle with vital living expenses. Another issue among shady lenders is that they actively encourage customers to postpone the payoff of their loans.
This process is known as a rollover and it means that the customer doesn’t pay back their original borrowed amount in the week that payment is due. Instead, the amount due will roll over until the next pay period. Such an action might appear to be helpful, but actually leads to increased charges and extra interest fees which causes a significant increase in their debts.
Even worse, another more serious problem occurs in cases when the payday loan company doesn’t impose a limit on the size of the debt that a customer can hold. This leads to payday loans that spiral out of control very quickly. Many times, a payday loan company will also fail to check the number of loans that a borrower has at one time.
Five Payday Loan Companies with the Worst Reputations
Numerous bad payday loan companies have been caught trying to intimidate their customers by constantly ringing their phones and refusing to deal with debt charities. According to numerous online resources, some of the worst payday loan companies in the US include the following brands:
- RISE Credit – This company promises its customers interest rates as low as 36%, but the truth is that their loans are over this advertised Annual Percentage Rate which in reality varies between 36% and 225%.
- Money Mutual – This is a company that cannot provide actual terms, interest rates or other loan charges. For example, for a two week loan, the charges translate to an APR of 391%.
- Cash America – This is not one of the well-known companies in the industry, so proper attention is recommended. Additionally, this company offers secured payments and collaterals, so that a double check of the company is required in order to ensure you don’t fall into a trap.
- United Cash Loans – The company tries to attract customers by promising a fast approval without verifying financial information. This is a primary indicator that the company is not a trustful one.
- FastBucks – This is a payday loan company that advertises their services with promises that they don’t check the credit of their customers. For people, this should be a signal of alarm, as it might mean that this company is not a truly reliable one.
Finding a Good Payday Loan Company
There are plenty of payday loan companies out there. While some are very good in this industry, there are also some payday loan companies that should be scrutinized very carefully before choosing them for your financial needs. A proper check of the company’s terms and conditions, you could potentially avoid falling into an unwanted financial trap.