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Senior Citizens and the Dangers of Payday Loans

Written By Unknown on Thursday, February 7, 2013 | 9:00 AM

There can be great benefits to taking out a payday loan, especially if the loan is one that can be easily repaid and the borrower has a plan for how to do so. Yet unwise borrowing can put a senior citizen in a terrible trap. Elderly borrowers must be aware of the current situation before they hastily borrow money for a payday loan.

While payday loans can cover medical expenses, groceries, or utility bills, senior citizens must be wary of payday loan sharks that are out to catch them. Studies show that payday lenders often conglomerate near government-subsidized housing, particularly for seniors and the disabled.

Payday lenders desire to target those on government benefits such as social security and disability or veteran benefits. They know that these men and women are guaranteed money every 30 days. While US law forbids payday lenders from directly securing money, there have been histories of companies which will partner conspire with banks in order to obtain these government payments right when they hit a borrower's account. These dishonest companies will then subtract debt repayments, fees, and interest, and return what money is left back to the bank account, leaving the borrower with little income to live on, and the need to take out another short-term loan.

If not monitored, some unscrupulous payday lenders can gain almost entire control of senior citizens' social security finances. An executive V.P. at the Community Financial Services Association of America says that isn't right to discriminate against certain borrowers because of their income.

Because of disability or medical conditions, often senior citizens get in tough financial binds. Not only do they have medical expenses, but they are not able to work more hours because of their conditions. These men and women then become trapped in the borrowing cycle in order to pay off the costs of food, rent, and other necessities.

If you are in need of a payday loan to help with expenses, try an online payday loan. With these web-based businesses, you can get the money you need without ever leaving your home. The online application process is often simple and quick, with no fuss or complication. Because these businesses are run entirely online, government-paid customers are treated without discrimination.

When applying for an online payday loan, make sure to always read the fine print and carefully research your company. Reliable, service-oriented companies will be willing to give you the funds that you need at the most cost-effective rates, and won't try to trap you into a debt cycle.

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