Ivy says:

Even the best budgeters may have trouble making ends meet with this down market. I am continually surprised with fluctuating prices. What is costing me more this week  was less expensive last week. If it’s not gas, it’s produce. Or the kids’ school is raising prices on milk. Or something. It’s always something.

That said, you might find yourself left with too much week left at the end of your paycheck. And it might seem like desperate times call for desperate measures, as a commercial I heard for a title pawn place said on the radio this morning. But trust me, you are not that desperate. You are NEVER that desperate.

When cash runs tight these three services only make the situation worse:

• Title Pawn
  The premise is simple: you roll up to the title pawn shop with a title to a car you own, they loan you some money (usually far, far less than the car is worth- generally about $300-$1000) and then they give you a monthly payment. What they don’t usually tell you is the monthly payment is only enough to pay the exorbitant interest rate- usually somewhere in the neighborhood of 25% monthly, which equals a THREE HUNDRED PERCENT Annual Percentage Rate. This rate depends on state regulations and it may be smaller or higher where you live, but it’s never, ever good. Just pay the monthly fee and you’ll be paying on that title pawn forever.

• Payday Advance
  This one doesn’t even require a car, all you need is a job and a checking account. You go in, write them a check for the amount you’re borrowing plus the interest. Then they give you the money you’re borrowing and you have 2 weeks to pay the check off or they’ll deposit it (Can we say bank fees?). They set the hook you by allowing you to “rewrite the check”- they give you 2 more weeks, provided you pay the interest. The interest rates are again sky high- similar to the title pawn fees. At a store close to me, I called and asked their rates. If you want to borrow $200, they charge $30 in interest for 2 weeks. This means if you get caught in their scheme, you’ll be paying the store $60 per month for them to help you kite checks. Errr. No thanks.

• Rent-To-Own
  Ooooh, nothing makes me more angry than rent-to-own. There are a lot of people in the world that confuse “want” with “need.” I see this all the time from the wanted ads on my local Freecycle list. “NEEDED: Big Screen TV for blind woman with disabilities” or “NEEDED: Laptop computer for college student with leprosy” or “NEEDED: Washer/Dryer for Christian couple with 17,532 disabled children.” Look, people. I love my television, laptop, and washer/dryer more than cheese, but I’m telling you. They’re not necessary. Especially if you are resorting to rent-to-own to get these items. If you have to do without a TV for awhile, awesome. Your kids won’t be bombarded by commercials for expensive “must have” toys. No laptop? There’s always the library. No washer or dryer? The laundromat is an interesting and mysterious place. Check it out.

So what do you do if you end up with more week than paycheck? It’s tempting to use one of these measures, but there are other ways. Scrounge up change from your couch, chairs, and under your dryer. Borrow, if you must, from friends or family. Hit a food pantry. Be creative with ramen. Be honest with the creditors you already have, “I don’t have all I owe this week. What terms are you willing to set?” You’d be surprised with what you can come up with.

But above all, do NOT let these predators in. Because that’s what they are, predators preying on people who need to stay away from these places the most.