DOTHAN, Ala. (WTVY) – The COVID-19 pandemic, job loss, and inflation has forced many people to turn to payday loans and lending when in a pinch to makes ends meet. But, at times, with those comes scams and predatory lending.
The Better Business Bureau recently conducted a study regarding this, and found more people are turning to these options to get by, and they warn consumers of scammers.
“What’s going on the past couple of years just kind of added gasoline to that fire,” Alex Derencz, Communications Manager BBB Serving Central & South Alabama, said. “Again a lot of folks have found themselves in tough situations.”
Derencz said each of these factors are putting people in a tough spot financially who are looking toward getting a payday loan for a short-term solution.
“One of the findings was that many folks are getting into these payday loans and they’re falling into their consumer “debt trap,” Derencz said.
Payday loans are nothing new, and Derencz said they aren’t always a quick fix. He said it is crucial for people to understand the numbers behind loans to avoid getting caught in a worse financial spot than they originally started with.
“Say you needed to get out 300 dollars to cover your rent, well come two weeks later you’re still unable to pay, more money is going to get tact on, more interest will get tact on, and you know by the end of that month that 300 dollars is going to be well upwards of 400 dollars,” Derencz said. “So, you can fall…
