It is almost impossible to escape advertisements about finances and loans these days. Every time that I log into my social media accounts, I am practically bombarded with them. It feels like each day there is a new application that is advertising their payday loans or other fast ways of getting cash and I always have to wonder: what is the catch?
I did a little bit of digging on this topic and I have a lot to say about it, hence this article today. There is a lot that we can stand to learn from this, and some of it might surprise you. Considering the sheer volume of these companies, talking about them is something that I consider important.
Certainly, they seem convenient on the surface. However, often they are hiding a dark sort of secret behind the veil. Many payday loans are quite predatory in nature, leading to some warnings about them from the federal government here in the United States.
Today, I will discuss with you what they are, as well as providing you with some potential alternative options. The main one in that category that I will cover are known as SMS loans. It can be easy to conflate the two, but I would definitely caution against doing so.
Kicking Things off Controversially: What are Payday Loans?
I know, I know. Maybe you are here, and you are wondering, “why the heck is this person talking about payday loans when the main topic is supposed to be SMS ones?” Trust me when I say there is good reason for this. Many of the former try to disguise themselves as the latter, so I want to help prevent you from falling from this marketing ruse.
These are small loans (usually no more than five hundred dollars) that you can borrow from certain lenders with the expectation that it will essentially be an “early” paycheck. You pay the amount back once you have actually been paid. What a lot of them forget to mention, though, is that there are hefty interest rates and fees involved.
This means that more often than not, you will end up paying them a lot more than the principal amount that you borrowed. When I say a lot, I mean a lot. Many borrowers end up in a lot of debt that almost feels insurmountable and is probably worse than whatever they used the money to pay for. You can read a bit more on that in this article, if you are still not convinced.
What are Some of the Safer Alternatives, then?
Now that you know what to avoid, let us consider some of the alternate options that you have available to you. I know that it can be really hard when we are in a bind and need cash right away but try not to let that temptation and anxiety win over when there are other things that you can try first. I would say that a payday loan should be your last resort.
To start out with, let us talk about bad credit consumer or personal loans. They are tailored to those who have difficulty qualifying for some other types while not being overly predatory or charging ludicrous amounts of interest. They are something worth looking into, for sure. Most lenders who specialize in this make a note of it, so if you look the phrase up on a search engine, you can probably find one.
In addition to those, you can also try out a credit card that is designed for a similar purpose: to help anyone who has poor credit still be able to borrow the money that they need. It is hardly a secret, after all, that having a bad credit score can be very detrimental. That is especially true right now, as we approach another economic recession.
Of course, all credit cards should still be used responsibly and with caution. You probably should not apply for one just so that you can go on a shopping spree. However, if there is an emergency that comes up in your life, it is more than okay to rely upon something like this to help out. The interest rates will be less than what you would have with a payday one, that is for sure.
The Meat and Potatoes: SMS Loans
Would you consider yourself addicted to your cell phone? I know that I definitely am, and it is a habit that I am trying hard to break. However, it does mean that if I get notifications or popups, I am a lot more likely to see them right away. That is where the argument for SMS loans comes into play. Still confused? Don’t worry – let me explain.
As the name suggests, these loans are applied to and agreed upon via text messages. SMS stands for short message service, which you can learn more about if you https://www.billigeforbrukslån.no/sms-lån/ or do some of your own research on the side. That means that if you decide to take this route for borrowing money, you will not have to deal with difficult phone calls or anything of the sort.
They are quite convenient in that sense. While there are a lot of doubts surrounding them because we worry that the customer service agents on the other side of the connection will not be responsive, research and studies have demonstrated quite the opposite. So, this means that you will probably be able to get the terms agreed upon quite quickly.
If you are thinking to yourself that this type sounds quite similar to those payday style ones, you are far from alone in that consideration. Unfortunately, a lot of those businesses take advantage of this naivety on the side of consumers and end up landing their customers in a lot of debt. Many of those mobile applications market the fact that you can get approved in just minutes and via very simple means.
SMS style loans are not dissimilar, but there are a few key distinctions between them. For one thing, there is still an application required. You simply perform it over text messages, making it a bit more convenient than some of the paperwork that we have to fill out in purpose (and it saves trees, talk about a bonus).
This means that while you can end up having your borrowed funds distributed quickly once you pass through the system, it is not quite as fast as some of the mobile apps. However, that tradeoff involves scoring a much lower interest rate as well. It might seem impersonal to do these things over a text message, but for many of us, it is preferable to being stuck on a phone call for hours or having to go into the bank or credit union in person.
With so many people on the go almost all of the time in this day and age, it can be hard to set aside that necessary time when the alternative is as simple as sending a few texts back and forth. When we put it like that, it is hard to argue, right? That being said, at the end of the day it will come down to what you are more comfortable with.
Not everyone feels confident with technology, after all. If that sounds like you, there is no shame in sticking with the more traditional method of borrowing money. As far as I am concerned, I think our comfort should be prioritized.
So…are there some Scams to Watch Out for Here, too?
I know that I have talked them up a lot, but as a final note for this article today, I would like to point out that there are some scams and predatory loans no matter what type that you are looking to try out. This means that we need to be vigilant when it comes to who we are borrowing from.
Of course, that is advice that is rather general. What are some specific tricks that some scammers use for SMS loans? The biggest one comes in the form of random, unsolicited text messages telling you about “amazing” loan opportunities. I definitely recommend caution if you receive any texts like this, since they are probably not from a trusted company (even if they claim to be).
If you have not inquired first, it is unlikely that you will be getting those texts. So, that is why I say to be cautious. Never give out any private or personal information to these unsolicited messengers, either. It could lead to your identity being stolen.
Thankfully, these types of ploys are usually rather easy to spot or figure out. My main advice is just to be careful about it and ask your lender if you are ever uncertain about a message being from them or not. Most of the time, customer service agents will be on standby and will be ready to assist you with your inquiries.
