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Is payday loan a good choice?

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I live paycheck to paycheck and have only one income, and my wife is busy raising the children. The front yard of my house needs some improvement. Can I opt for a payday loan? I live in California. What are other options open for me?

It seems you have a limited income, with no other sources of money from your family's end. So, you must be careful if you are considering taking out a payday loan. Have you estimated how much you need for the improvement work? Make sure you have a planned budget, or else you might face a shortage of funds or may borrow more than you need.

However, in California, the Fair Access to Credit Act prohibits lenders from charging more than 36% on consumer loans (that includes payday loans) of $2,500 to $10,000. Lenders may also charge an "administrative fee" not to exceed $75 per year for loans larger than $2500. For loans less than $2500, the administrative fee may not exceed the lesser of 5% of the principal amount or $50.

So, it's up to you whether or not you borrow a payday loan. If you ask me, I would suggest you may opt for a low-interest personal loan. I recommend this because the interest rate of a personal loan ranging from $3,000 to $40,000 is 5.99% - 35.99%, which is comparatively lower than payday loans or credit cards.

Sub: #1 posted on Tue, 09/06/2022 - 01:01

Barbara Delinsky Barbara Delinsky

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You need a monthly budget to help you set aside money after meeting all the necessary expenses. I assume you don't have any emergency funds to meet sudden financial needs. Try not to consider any storefront loan this time. You can request your family or friends to give you a loan with favorable interest, or you can go for a personal loan. However, remember that you need a good credit score to get a reasonable interest rate if you can delay the improvement. I would suggest you save enough money first as an emergency fund. Using that money will help you not to obtain any loans.

Sub: #2 posted on Tue, 09/06/2022 - 22:28

Sanders Patricia Sanders Patricia

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