What is a "payday loan"?

What is a "payday loan"?

Mitchell Freedman, CPA/PFS (CEO, MFAC Financial Advisors) gives expert video advice on: Where can I get a loan?; Are credit union loan rates always lower than bank loan rates?; How can I borrow money to buy a car? and more...

We are seeing many people who have a difficult time living paycheque to paycheque use payday loans. A payday loan is borrowing money and having it secured by your next paycheque. There are lenders who will lend you money on the promise that you will pay out of your next paycheque. Typically, the interest rates on these loans are very high, and I would recommend that individuals avoid these kinds of loans, unless they're truly in dire circumstances and it's only on a temporary basis.