Payday loans can have interest rates over 600%

Source: Megan Leonhardt, CNBC

The Center for Responsible Lending analyzed the average APR for a $300 loan in each U.S. state based on a 14-day loan term. Generally, payday lenders levy a “finance charge” for each loan, which includes service fees and interest, so many times consumers don’t always know exactly how much interest they’re paying.

For states that do not have rate caps, the interest can be sky-high. Texas has the highest payday loan rates in the U.S. The typical APR for a Texas loan, 664%, is more than 40 times the average credit card interest rate of 16.12%!

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