I know what loans are but what makes them so much worse?
Edit: thank you everyone for Answering! I think I got it now 🙂
In: 32
Most of the comments are close but off (at least here in Canada)
They’re meant to be short term loans that you pay back on your next payday with a high interest rate (roughly 15% depending on your province)
While it’s now illegal to do a rollover (just pay the interest and reloan again. Basically stuck in a cycle of paying only the interest) what a lot of ppl tend to do is either pay it off and reborrow – meaning yoyre paying that high interest rate on each of your paydays, or do a separate payday loan elsewhere to pay it off. Now you have more loans to pay.
And it becomes a vicious cycle like that where it’s hard to get out.
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