When might the use of payday loans be a sensible idea? Apart from this particular instance, you might never again find the words payday and sensible in the same sentence. In fact, there are very few instances when such a high-risk maneuver for acquiring cash should ever be used.

In case you are not familiar with this mode of lending, it works like this: assuming you have a valid identification card, bank account in good standing and a job that pays you by check – you qualify. Find a nearby payday loan store or pawn shop and you are even closer at becoming a borrower. An industry regulated by somewhat murky laws, it seems the only population with any real protection against what in many cases amounts to predatory lending are Service members, for whom lenders are prohibited by federal law from charging more than 36 percent in annual interest. Thirty six percent? Though it may seem high enough, with average high interest rate credit cards charging between 22 to 25 percent annually, 36 percent isn’t even half the annual interested charged by most payday loans. That number comes closer to 300 and even as high as 400 percent annually!

The term for repayment is usually two weeks, after which payday lenders automatically draft the finances charges due from the borrower’s bank account. The lucky ones are able to pay back the entire loan at once, but what most often happens, only the finance charges are paid – the amount borrowed keeps getting put back. Until quite possibly a year or more goes by where a borrower is paying over 300% APR, not including the fees charged to setup the loan.

In a word – caution. Should the worst happen and insufficient funds be in your account to cover the automatic draft for finance charges, your next stop could be jail.

There are little emergencies in life that happen every day. Most emergencies are easy to deal with, others… not so much. Some examples include: a dead battery when trying to start your car or your washing machine breaks. Though one many try to keep extra cash on-hand, it is not always easy. Thankfully, there are valuable alternatives.

Cash advance establishments and pay day lenders provide a vital service to many people in need. These places give emergency loans which are typically short-term loans that cover a couple of weeks. You can get the cash you need to fix the car or repair the house – then pay the money back, along with slight interest, when you get paid. Though these loans may carry higher interest rates than other conventional loans, the amount is nominal especially when considering the money is given to you, immediately. In fact, many people consider the convenience of getting the cash advance well worth the money. Bear in mind, the fees for a cash advance are often less than the cost of bouncing a check should you “overdraw” your account.

Most people also consider getting cash from a short-term lender a much better alternative than having to ask a relative or friend for money. Nothing can torpedo a relationship faster than borrowing cash. By dealing with a professional, the terms of the loan are clearly spelled out and there is not going to be any internal reluctance when it comes time to pay the money back.

There are other ways to raise cash quick – like pawning something of value, but why would you want to put your personal property at risk when a “quickie” loan is available? In most cases, you can borrow up to a thousand dollars and this money can be wired into your account (overnight) to meet your need during an emergency.