Payday loans can help you get cash fast. However, many come with high interest rates and other fees that can leave people struggling in debt. Sometimes people feel like they're up against the wall and need the money fast.
"It's an opportunity to get money to consumers by the end of the week," said Viridiana Quintana of the San Diego Better Business Bureau. "It's until they receive their paychecks."
Now the BBB says these ads are popping up on social media sites like Tiktok and Instagram or Facebook, targeting younger audiences. It's an audience that might not know about the risks involved with a so-called payday loan.
"They can go into this type of debt without realizing they have incurred incredibly large fees that they didn't see directly on the publication," said Quintana.
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The BBB warns that some videos or ads might refer to interest rates as "tips" or a "fees." It also points out a $15 fee to borrow $100 translates to an APR of nearly 400%
"A lot of times they do have different types of fees you have to pay," said Quintana. "That's where it really starts to accumulate."
Quintana says you shouldn't take ads on social media at face value. Instead, you should do your own research before agreeing to anything.
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"Even seeing if anyone else has commented and said anything," said Quintana. "Is it a positive or negative?"
Experts also recommend talking with teens or young adults in your family to help them from falling for predatory lending practices.
