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(Advertising) — Regardless of whether you are traveler or permanent resident, people in Hawaii know that an emergency can arise at any moment. Once you get past the immediate problem caused by the emergency (get medical treatment, fix a disabled car, maybe even take care of an ailing, beloved pet), there is often a financial problem to be managed.
You are given a little more time to take care of the bill that follows. But for most household budgets, there isnt a lot of wiggle room in that time. You might have to pay that doctors bill in a month, or buy medications for you or your pet with cash on the spot. Or, if its a car repair, you have to pony up the cash on the spot before the mechanic releases the vehicle (in most situations). Meanwhile, there is rent or a mortgage to pay, groceries to buy, utilities to keep in service and insurance payments to make.
To cover those obligations, what are your options?
- Borrow from family or friends This is the tried and true source of a quick cash advance, but be clear on the repayment terms: How much is interest (if any), and what is the payback schedule. Then stick to it you dont want to mess up a relationship over misunderstandings about money.
- Offer up car title or home equity Car title loans are not allowed in Hawaii but are allowable on the mainland, including California, Arizona and Nevada. Home equity loans are available everywhere. And if you default on any of these, you risk losing your home and your car.
- Payday loan If you have a job, you can get a payday advance loan, effectively bringing future cash into your banking account by the next morning. This is a short-term loan that needs to be repaid in about 30 days or less.
How you manage cash shortfalls are of course entirely up to you. But doing so with a sense of the available options should help you move forward with the confidence that you are making the best of a less-than-optimal situation.
February 16th, 2011 at 2:48 pm
Just be careful on those payday loans. They can be a good thing in an emergency, but they do carry a HUGE price if you do not pay it back on time.
Like 700% interest per year. REALLY.
And, as part of the loan process, they know who your employer is right away – so if you fail to pay it back – your employer will be served a wage garnishment order immediately.
February 16th, 2011 at 8:01 pm
Get the big picture of what a payday loan really costs. Let’s say you borrow $100, with payment due in two weeks. The lender takes your personal check for $115, and holds it until your next payday, or rolls it over into the next loan period. You receive $100, the lender keeps $15, which equals an APR of almost 400 percent. If you extend the loan term with three more two-week periods, you’ll pay $160 for that $100 loan.
Most of these lenders are getting their funds from wells fargo and BofA. this practice is known as predatory lending. those big companies dont want to put their names on a storefront that charges usury rates and they dont want to invest in the typically depressed areas that the clientel live, but they see it as a lucrative market they cant ignore. those two lenders made over 70billion last year funding the lenders that prey on the naivette of the underemployed, overextended unbanked members of working class communities. Tony Soprano would be proud.
February 18th, 2011 at 8:07 am
I agree with you Steve.
Your take on the “payday” loan arms of the major banks is important to know. And predatory is the right adjective.