We’re here for our members: Helping break the expensive, quick-loan cycle.
You may find yourself in need to borrow money, And when you need it in a hurry, a quick loan or payday loan can seem like a good solution. But, in most cases, they’re not. Consider these numbers:
- 12 million* Americans use payday loans each year.
- Every year, Americans pay $9 billion** in fees on payday loans.
- The average annual percentage rate (APR) on paydays loans is 396%*.
- The average payday loan borrower is in debt for five months and spends an average of $520* in fees to repeatedly borrow $375.
Truth is, when it comes to borrowing money, these types of loans can be some the most expensive and difficult for borrowers to pay back.
Unfortunately, at Guardian Credit Union, we regularly see members who have turned to this type of borrowing when they are in need. The good news is we’ve also helped many of our members eliminate the need for quick loans, lower their monthly payments and help them get out of debt. Here’s just one example:
When a member came into a branch with a check from a payday lender, the teller encouraged her to sit down with a loan officer to discuss her needs. She applied for a loan and while it was being processed, the loan officer realized the member and her husband had numerous short-term loans on their credit report. Turns out the couple was paying nearly $700 a month and the interest rate on their loans was over 150%. They had been paying on a $5,000 loan for nearly two years and had paid less than $250 of the principal balance.
Guardian was able to help the couple with a consolidation loan of $9,000 at a rate of 13.2% and a monthly payment of less than $300 for 42 months. The loan also allowed them to get $1,500 cash out for the holidays. After having helped the couple, the loan officer said, “this all started with a conversation in the teller line and was one of my favorite experiences as a loan officer to date!”
At Guardian, we’re here to connect our members to the best, most affordable financial solutions. We care about their financial well-being and we want to offer our members financial solutions they can reasonably afford.
Not only can we help members who find themselves trapped in the expensive quick-loan cycle, but we can find a much more affordable, manageable way for members to meet their short-term cashflow needs as well. Because at Guardian, we’re here to help.
* Information from www.pewtrusts.org/-/media/assets/2016/06/payday_loan_facts_and_the_cfpbs_impact.pdf
** Information from www.mycreditsummit.com/payday-loan-debt-statistics/