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When you pay the minimum balance on a payday loan does that eventually pay the loan off?

nolan3248 asked:

I have a payday loan for 300 dollars my balance is 390. I just paid the 90 dollar minimum and the balance is still at 390. Do I have to pay the loan off in full to get rid of it?
Asked on: 2007-12-11 04:46:52

5 Comments

  1. Judy says:

    Sounds like the $90 is just interest – if you just pay the interest then no, it never gets paid off. You need to pay the whole amount, or at least a lot more every payment than the minimum.

  2. Al says:

    payday loans are designed to keep you stuck in its cycle, pay it off ASAP, try to save your money in areas where you can cut back, if you have a cell phone and a home phone, get rid of one, reduce your cable tv to life line service ( 20 basic channels ) for about $14.
    make croc pot meals that stretches a couple of days.

  3. kelannde says:

    Get the money to pay off that loan. You will end up paying nearly 1000 percent interest on your loan. Yes – a thousand percent.

    If you continue to pay the minimum, not only will you never pay it off, you’ll actually eventually double the amount you owe.

  4. Serena says:

    Your payment only took care of the interest that accumulated, so you’ll have the bill forever if you don’t start paying above the minimum. Below is a link to a calculator that will tell you how much you need to pay in order to get rid of the loan. The faster you want to pay it off, the higher the payment will be. I recommend trying to pay as much as possible each time. The interest adds up quickly and that $300 will eventually end up costing you $1000 if you’re not careful.

    To use the calculator, go to What will it take to pay off my credit card? and enter the information like interest rate and balance. You have a choice between setting it to figure out when you could pay it off based on how much you pay each month or you can put in the date by which you want to pay it off and it will tell you what your payments should be.

    This loan is very high interest. If you can, make sure you give this bill a priority over bills that have lower interest.

  5. this sounds discouraging

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