Dangers of Applying for an Online Payday Loan
Wednesday, February 18th, 2015
By Susan Ladika, creditcards.com
As consumers move their financial activities online, applying online for a payday loan may seem like the natural thing for a cash-strapped person to do.
But you could be setting yourself up for a world of hurt, from paying exorbitant interest rates to having funds swiped from your bank account to being threatened by debt collectors. Just filling out an application could be enough to begin the harassment and thievery.
“Absolutely the worst thing you can do is apply for an online payday loan,” says Jay Speer, executive director of the Virginia Poverty Law Center.
Most online payday loan sites aren’t even operated by lenders. They’re run by “lead generators,” who seek your personal information, such as Social Security number, driver’s license number and bank account details. They then sell that information to lenders.
“Your email and telephone explode after that,” Speer says, as lenders vie to offer you cash. That can happen even if you live in one of the 15 states where payday loans are illegal.
Published: February 17, 2015