Pay Day loans are currently on more than a 130% increase since last year, and the credit crunch is the main blame for this dramatic swell in lending. However, the quick boost style option is beginning to rack up more bad press than good both in the united kingdom and over in the united states.



The most likely reason that these loans are getting such bad press is that the APR and interest rates are so out of this world. If you purchase a loan for one hundred pounds you will likely be expected to pay back 125. That isnt too bad or so it seems, but if you take a loan out for 700 you will be paying back around nine hundred and thirty!





This interest works out to around 1,200 percent, against the typical 20% offered by credit cards or 18% by high street bank loans. The sad part about this whole story is that the loans that are being used by those in financial difficulty are ultimately making it worse for themselves due to the extra cash they have to pay out In order to return the money they loaned out. This of course sets them back before anything else has been purchased throughout the month.



Experts are getting concerned that more of us are going to be digging ourselves into a financial or more, debt, hole with there not being any regard for how to get out again.



If you are considering taking out a pay day loan why not take a look into a personal loan first? You will most likely get a better interest rate and over all deal, as well as the pay back dates being further away giving you chance to correct your financial difficulties before they turn into a vicious circle. If you do in fact have to opt for the pay day loan, be sure that you pay it back as quickly as you can and try to avoid coming to rely on them each month.