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Canajun Finances Home » Pay Day Loans are Crack Cocaine of Personal Finances

Pay Day Loans are Crack Cocaine of Personal Finances

I said it! I meant it! Pay Day Loans are predatory short term, high interest rate loans designed to entrap their customers in a financial death spiral.

Yup, if you look down the side of this post, you will find ads for Payday Loans, for that I apologize, I need to look into Adsense on how to turn those off, but yes, Pay Day Loans are the Financial Equivalent of Crack to your finances.

I have no idea how Crack feels, and I do not wish to ever learn (I have much the same view on Pay Day Loans too), however, prevailing opinions is that Crack is highly addictive, and it’s high diminishes over time so you have to use it more but you still don’t ever reach that initial high, much like a Pay Day Loan. Pay Day Loans are highly financially addictive, and once you start using them, your financial well-being goes down hill quickly, and they are hard to kick as a habit.

Pay Day loans are modern day loan sharks
Modern Day Loan Sharks

Why am I bitching about this still? Where I live in Ottawa is a relatively affluent area (although it does have a food bank), but it has more than a few Cheque Cashing/Pay Day Loan “stores”. All I can ask is What the Hell is Going on?

Interest rates are ridiculously low and these places are spreading faster than the black death in the middle ages, what happens when interest rates start going up? There are more regulations on these places, but I just don’t understand why there are so damn many of them.

Please feel free to comment on this (any comments about how I am a hypocrite for having ads on my site for these parasites, expect a colourful reply, but take your arguments to Google for allowing them to advertise) topic, and any insight as to why they are multiplying in a Fibonacci sequence would be helpful too.

Feel Free to Comment

  1. I hate the places. I helped a friend learn how to eventually get out of debt, as she had 4 payday loans with 3 lenders, and at one point found out from her roommate that the company had put in their demand for payment to the bank so that it hit the bank the evening before their Disability checks went into the bank.

    That meant the Payday loan payment hit the cheque before their rent was taken out. That also meant there was not enough for them to pay the rent. Between the two of them, they were able to use their food money to ensure they did not get kicked out with my help, but that still meant they were lining up at the food bank to get food for two months.

    These companies are the lowest form of humanity, well, maybe second lowest, as I am debating where collection agencies fit in there…

  2. You are not a hypocrite because people who get payday loans are (in theory) adults and adults (in theory) should be able to make an informed decision about whether or no they should get a payday loan.

  3. lol isn’t it terrible that, when an article says something like “credit card balance transfer deals ALWAYS have catches that make them a bad deal”, Google will immediately serve an ad for a credit card balance transfer?

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