So I have a rant that I need to get out of my system. After more than a year, I had to bite the bullet and get a payday loan. The torque converter went in my car around the middle of June. After being without a car for more than two weeks (and paying for increased bus fare, jitney fees, etc.) it was decided that I needed to get the car fixed. Not quite as expensive as replacing the entire transmission…but up there (a little more than $1K). I shelled out the money and had my car back up and running by the 4th of July.
But that ate into my rent money. So I took out a payday loan of $500 to hold me over. And I seriously needed it…I was down to like $20 of accessible cash when I got the deposit July 8th. I went with Northern Plains Funding which was referred to me by one of those sites that match you with lenders. The application process wasn’t smooth. I applied online, and the website confirmed that the application was received. But then they waited to call me the following day, to confirm the application information. By then the date had changed. The representative then went through the entire application…so it was basically a repeat of what I did online. Plus verification calls to my bank and employer. An hour later (maybe it was even longer), she said that she would get back to me to let me know the loan was approved.
Anyway, my original account to receive the payday loan deposit was denied because it was a money market account. So I needed to re-verify a standard checking account. Whatever. Another phone call later to confirm that I was approved (could have just did that with an email…but whatever again). I received the deposit the following day. At least that went over without a hitch.
My first payment was less than the stipulated advertised finance amount because I did not receive it a full 2 weeks prior to my next payday. That was good and fair. I went ahead and payed the scheduled amount of $85.xx because I was still in financial recovery mode. I also decided to take out a hardship withdrawal of my 401(k) (ugh) which is pretty small being that I just recently started my job. But with those funds, I didn’t have to worry about taking a big hit to repay my payday loan.
So I thought.
Next payday comes up and I opt for just the standard amount to be withdrawn again. Mind you, after my previous payment, I did try to log on to their website for my payment/loan schedule…and I couldn’t find it. It also wasn’t emailed to me (I saw it, once, upon completion of my application, but I didn’t bother to download and save the pdf at that time. Of course I had no idea that I would have no access to it later!). They do have a mock schedule online, to show your rates/schedule when you borrow $300. I wish I would have seen that before applying! My rent is due again though, so I wanted to pay off the loan balance on my following check. I figured I would owe $300-something given my initial payment of $85.xx and my follow-up payment of $150.xx. I called up Northern Plains to inform them that I wanted to satisfy the loan on my next payment in August. The rep informed me that to do so, I would need to pay $649.xx
Say what?! Oh no….there must be some mistake!
I’ve down payday loans before. And usually, they charge you an initial finance rate on a schedule that charges you per $50 or per $100 that you borrow. So for example, if you borrow $300, then you are charged $100. Yeah, it’s high….33% of the base. But when you’re in a bind, you’re in a bind. Then, the longer the loan is kept outstanding, the more of that crazy APR is charged. But your payments are still applied to that loaned $400 ($300 +$100), plus interest. But no…not Northern Plains Funding. They somehow have the insane idea to charge you the $150 finance fee on $500 in full, every two weeks the loan is outstanding. So my payments weren’t taking care of my principal at all (well a teeny, tiny bit – in two weeks, a whopping $0.31 came off). I basically still owe the original loan amount plus the finance fee, in spite of paying $243 so far.
Pardon my French, but what a complete crock of shit!
So In The End…
In spite of the crazy overcharge, I still scheduled the loan payoff in August…because there was no way I was going to keep making payments, with almost none of it going towards my principal! This just maybe the worst case of loan sharking that I’ve ever encountered! Horrible, horrible stuff. Even if you are desperate, I would stay far away from this company. There are better payday loan companies out there for sure (sadly I don’t know who they are though…because I’m out of the loop, and I’m hoping to really not need another payday loan for quite some time)!
So yes, the month of July put me through the ringer financially. Here’s how it played out in the end:
|$500 – Payday loan||$85 – 1st loan payment|
|$644 – 401(k) withdrawal||$150 – 2nd loan payment|
|$649 – final loan payment|
Due to the 401(k) withdrawal, my contributions to that will stop for the next 6 months. I also adjusted my W4 allowances (so much for that windfall return in 2017). These two adjustments combined should raise my take home pay by $100 (I’m guessing – if it’s more, that would be awesome!).
Ultimately I’m just trying to buffer the blow of needing to pay back almost 2X what I was expecting to on this ridiculous loan! 🙁
Oh well – the joys of being working-class/borderline poor I guess! You live and you learn 😉