No two personal loans are the same — they will have different terms, conditions, and fees associated with them. However, there are some loans that are notorious, even known to be very anti-consumer, actively preying on lower-income communities and those who are desperate. Here are some of the worst offenders.

Car Title Loans: High-Interest Rates and Incompetent Terms

A person who is looking for a car title loan will submit the title to their car, truck, or motorcycle to a lender as a form of collateral. The person who is borrowing the money agrees to a litany of fees as part of the loan’s terms and conditions, with a fee to initiate the loan. While they are rather straight forward, car title loans are a notoriously bad option for obtaining a car. The car title loan is tacked with a high-interest rate, usually more than 300%. Not only will the borrower have to pay back an exuberant amount of money within 30 days, but most car title loans will require repayment in full. The terms and conditions of a car title loan puts your personal possessions at risk, with the loan being a fraction of the car’s market value.

Student Loans: Long-Lasting Debt

While the merit of student loans can be debated, they are one of the worst types of debts. Not only are student loans one of the first debts that a young person will have if they are pursuing further education, but if they do not have the right financial knowledge, they can unknowingly catapult themselves into severe financial debt. More than 44 million Americans are struggling with student debt — debt that cannot be canceled out with bankruptcy and will take decades to pay off, sometimes into retirement.

Payday Loans: The Worst Type of Debt

Payday loans are marketed as helpful and practical solutions for those who need quick cash in between paychecks. What they really are; however, are credit products marketed at misinformed customers. Not only are payday loans predatory, but they are one of the most expensive loans you can get. While the traditional credit card typically has an annual APR between 10% and 30%, payday loans are associated with extreme APR at upwards of 5,000%.

Debt Relief Assistance

Progressive Debt Relief is designed to remediate the effects of payday loans by actively settling different forms of unsecured debt. To learn more about our solutions for those in a financial black hole due to payday loans, contact us today 877.590.1847.