According to the Consumer Finance Protection Bureau, four out of every five payday loans is either rolled over or renewed. The average payday borrower eventually takes out eight loans annually, and remains in debt for five months out of the year, according to the Pew Charitable Trust. What’s behind these sobering statistics?
At LoanNow, we recognize that lack of basic credit education rather than spendthrift habits is a major contributor to the national payday loan epidemic. We explain how payday loans work, and why they are almost always a bad idea. We decipher interest rates and APRs to help individuals understand how a $300 payday loan can mushroom into an obligation of four figures within just a few months. Our informational articles and blog posts are available to anyone who visits the LoanNow site. We want as many people as possible to understand how payday loans work to trap desperate borrowers in an endless cycle of debt.
We at LoanNow also recognize that despite the economic recovery, many Americans are still experiencing financial hardship. Many lost their homes, along with a significant portion of their net worth. Others who lost jobs were often forced to accept positions that paid much less than they were making before, leaving them to juggle expenses with wages that simply do not cover their obligations. In desperation, many households turn to payday loans, despite the dangers. We help borrowers find alternatives to payday loans, including loans from LoanNow, to help them escape the payday loan trap.
But we don’t just make loans. To reverse the dangerous trend of payday loan dependency, we provide timely, relevant and accessible articles that help borrowers set realistic savings goals restore and establish their credit and adopt good personal management practices to improve their long term financial outlooks. We encourage borrowers to develop budgets that allow them to cover their obligations and begin to put away savings. We work to empower our borrowers to improve their lives and financial circumstances for the long term.
Borrowers who embrace our advice and credit education, and who maintain consistent and responsible on-time repayment records are rewarded with improved LoanNow scores which qualify them for lower interest rates on future loans. The ultimate goal of our innovative lending service is to integrate with the three major credit reporting bureaus: TransUnion, Equifax and Experian, to report the positive repayment histories of our borrowers and help them improve their overall credit profiles. In this way, we hope make a lasting improvement in the well being of our customers.
At LoanNow, our multi-faceted approach of lending, credit education and incentives encourages our customers to develop responsible borrowing and repayment habits.
We are committed to helping our borrowers achieve long term financial stability, not just enhance our bottom line.