In the past, we’ve discussed some of the many reasons to avoid a payday loan. While it’s easy to focus on the financial impact –primarily the high interest rate – there’s something else to think about: the emotional toll this relationship can take on your life.

To start, borrowing from a loan shark can result in a cycle that’s not always difficult to break. You tell yourself you’re only taking out a single loan, but soon enough you’re coming back for more.

Here’s what we had to say about this in a past article:

“You take out a payday loan with the idea that you’ll never do so again. However, you soon find that it’s difficult to escape. Here’s why: you may not be able to repay the loan on the due date,meaning it costs you more money in fees. This leads to your debt dragging on for much longer than expected.”

When you slip into this cycle it’ll begin to weigh you down.

Here are a couple other things to keep in mind:

• Fear of higher rates and fees in the future. Forexample, if you miss a payment, you have to concern yourself with extremelyhigh fees, often accompanied by an interest rate hike.
• Fear of violence. This isn’t something you ever have to worry about when borrowing from a traditional lender. However, when borrowing from a loan shark, it’ll always be in the back of your mind. You never know if you’ll make a mistake that leads to a violent or aggressive encounter.

The emotional impact of borrowing from a loan shark is very real. If you don’t think about this upfront, you could go down a dark path that adds quite a bit of stress to your life.

Do you have any experience borrowing money from a loan shark? What was the emotional impact on your life?

There may come a point in your life when you feel like there’s no way to obtain the funding you need. If this happens, it’s natural to open your mind to any and every option – even those that don’t make good sense.

This leads to an important question: is there ever a good time to borrow money from a loan shark?

Here are some of the reasons why it’s tempting:

• There is much less paperwork than with a traditional loan or credit card
• You can receive an approval on the spot, as opposed to having to wait for your application to be reviewed
• You don’t need good credit in order to qualify

With these things in mind, it’s easy to assume that doing business with a loan shark is the best way to improve your finances (at least over the short term). Unfortunately, if you decide to go down this path, it’ll likely make things worse on you over the long run. Here’s why:

• High interest rate: Unless you’re comfortable paying an ultra-high rate, you should avoid loan sharks at all costs. You may get the money you need, but it’ll cost you big time by way of interest.
• Lack of formal documentation: It sounds nice upfront that you don’t have to complete a long application, but a lack of formal documentation can haunt you in the long run. Don’t let the application requirement scare you away from a legitimate form of borrowing.
• It can start a nasty cycle: You think you’re only borrowing money one time, but you soon find that you need more. And since you’re already in the cycle, you stay there because it’s the easiest thing to do. The more you borrow and the longer the relationship drags on, the more difficult it is to break free.

As a general rule of thumb, there is never a good time to borrow money from a loan shark. Even if you need money now and it seems like your only option, look into more legitimate lenders. You’ll be glad that you did in the end.

Many people turn to a payday loan when they need a small amount of money for a short period of time. While the opportunity is available, you need to think twice before you head down this financial path.

Even if you have the best intentions, one slip up with a payday loan can cost you hundreds of dollars. Not to mention the fact that it can put unnecessary pressure on your financial life in the future.

Here are three of the main reasons to avoid a payday loan:

• Lender deception. With a credit card company or local bank, you know you’re dealing with a reputable lender. You can trust them to provide honest service and to answer any questions you may have. Unfortunately, this isn’t the case with most payday lenders, as all they care about is lending you money and making a profit in return.
• More expensive than other options. If you think credit cards have a high interest rate, wait until you see what you’re getting into with a payday loan. Payday lenders typically charge somewhere in the $15 to $20 range for every $100 you borrow.
• A difficult cycle to break. You take out a payday loan with the idea that you’ll never do so again. However, you soon find that it’s difficult to escape. Here’s why: you may not be able to repay the loan on the due date, meaning it costs you more money in fees. This leads to your debt dragging on for much longer than expected.

The best thing you can do is avoid payday lenders altogether. You may be tempted. You may even think you can get away with borrowing money “just once.” Before you make the decision to apply, compare the pros and cons to other options. This will typically lead to enough information to bring you to your senses.

Although buying a used car with cash may be the ideal situation, many consumers realize this is not reality. They soon come to the understanding that their only option is to take advantage of a used car loan.

If you find yourself in this position, it would be in your best interest to compare multiple loans. This is the only way to guarantee that the deal suits your every want and need.

Here are three tips for finding the best used car loan:

Start with the dealer. The dealer’s finance department can help you secure a loan. This is a good place to start, as you don’t have to do any of the work.
But here is what you need to remember: they may not be as thorough as you would like. So, while there is nothing wrong with starting here, you don’t want to end here unless you are 100 percent comfortable with the loan product made available to you.

Do your own homework. When the time comes, don’t shy away from contacting lenders on your own time. You can do this via phone or online. Either way, it gives you the opportunity to learn more about what is available.
Don’t be surprised if you find a loan that is more competitive than those offered by the dealer.

Make a checklist of what’s important to you. For some, the interest rate is the only thing that matters. Others, however, also focus on details such as the reputation of the lender and their customer service experience. With a checklist in hand, you can focus on the details that you consider critical.
Anybody can find “just any” used car loan, but you don’t want to stop there. You want to find the loan that is best for your situation.