When you need cash for an unexpected expense, payday loans may seem like a quick and easy solution. However, in Hubert, North Carolina, payday loans are prohibited under state law, leaving residents without this borrowing option.
What are payday loans?
Payday loans are short-term, high-interest loans that typically require repayment on the borrower’s next payday. These loans come with high fees and interest rates, making them a costly way to borrow money. The average payday loan carries an annual percentage rate (APR) of nearly 400%.
Why are payday loans prohibited in North Carolina?
In 2001, North Carolina passed legislation that made payday lending illegal in the state. The law capped interest rates on small loans at 36%, effectively making payday loans unprofitable for lenders.
The law was enacted to protect consumers from the high fees and interest rates associated with payday loans. Many borrowers found themselves trapped in a cycle of debt, taking out new loans to pay off old ones and falling deeper into financial instability.
What are the alternatives to payday loans in Hubert, North Carolina?
Fortunately, there are a variety of alternative borrowing options available to residents of Hubert and other parts of North Carolina.
- Credit Union Loans: Local credit unions offer low-cost loans to members with good credit. Check with your local credit union to see what options are available.
- Personal Loans: If you have good credit, you may be able to qualify for a personal loan from a bank or online lender. These loans typically come with lower interest rates and more favorable repayment terms than payday loans.
- Government Assistance Programs: Depending on your circumstances, you may qualify for government assistance programs such as SNAP (food stamps) or TANF (temporary assistance for needy families).
- Peer-to-Peer Lending: Peer-to-peer lending platforms connect borrowers with individual investors willing to lend money. These loans can be a good alternative to payday loans, but they may carry higher interest rates than traditional bank loans.
Interesting Facts and Statistics
- The average payday loan in North Carolina is $237.
- North Carolina is one of 18 states that prohibit payday lending.
- Payday lenders have found ways to operate in North Carolina by partnering with out-of-state banks.
- The North Carolina attorney general’s office received nearly 2,000 complaints about payday lending practices between 2006 and 2013.
Apply Now
While payday loans are prohibited in Hubert, North Carolina, TheGuaranteedLoans can help connect you with lenders offering other borrowing options. As a connector service, we are not a direct lender and do not make credit decisions. Instead, we work with a network of lenders to help match you with the best loan options for your needs. Apply now to see what options are available.