Being strapped for cash does not make a cash advance a perfect solution. Too often, a customer will fall back on the short-term loan in order to make good on some emergency payments; but when the due date comes round in just a few short weeks, that individual is still cash strapped. Now what? This story is heard around the world as the cash advance cycle of debt.
A cash advance lender does not try to catch you in a debt trap.
There are no nets or lures hanging in the office. You won’t find Internet magnets steering your pages to their website, but if you do search for fast cash, there will be plenty of results waiting with doors open to receive your application. You see, a lender cannot loan money without a customer first applying for a loan. Those who end up in a financial pickle, seeking out every available avenue to get some cash relief, will be making the calls and filling out the forms.
What was the bait? Was it the big bold words which said “No Credit Bureau Check Loan” or ‘Fast money” which struck your fancy and kept you on the page? Could it have been the convenience of money going directly into your checking account without even having to change out of your pajamas? Whatever it was, customers take that bait in hopes to getting some financial relief.
Once the cash advance loan is approved, what happens next? Does the lender send the customer on his/her merry way not informing them of the loan terms and conditions? Does the customer not know that their loan will be expected to be paid in full in just a few short weeks? Did they not know the amount would be taking out of the checking account as a EFT debit? Any good lender would never leave a customer hanging and if you have ever come across one who does leave you hanging, then it is time to move on to a new lender. When you work with responsible lenders, the customer service representatives will take their time and explain all about the loan process as many times as a customer needs in order for there to be no misunderstandings. this does not sound like a debt trap at all.
What is the cash advance cycle of debt?
Cash strapped customers do not always have their problems solved by taking out an online cash advance. Quite often, these people are living paycheck to paycheck and when the next paycheck comes around, there won’t be any money left to pay off the loan. The cycle begins when the customer takes out a new one in order to pay for the last one…and so on and so forth. The big problem with this process is that each time a loan is taken out, fees are attached to the payoff, so the loans grow larger each time a new one is taken out. Eventually a person is not able to take out enough to pay off the prior loan. If there is no cash available now and a customer knows there will not be cash available later, then a short-term loan is not the best solution for the problem. No one needs to be caught in a cycle of debt an responsible lenders don’t want to put you there either.
