Get Out of Debt Guy

My Payday Loan is Killing Me

Posted September 10, 2013

WRAL Reader Question

Dear Steve,

I have recently gotten in a bind with trying to live paycheck to paycheck. I went and did a payday loan over the internet through mobileloans.

Now it is really stressing me because I can't keep my main bills paid nor my credit cards cause they get $145 biweekly not to mention my hours have been cut from 40 to 36 with no overtime.

I am a single parent with only $50 granted a month for child support which is 3 mths behind, my food stamps just became available, and I have a very old van that needs work but I can't afford to put it in the shop.

Is there anything I can do about the payday loan?


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Dear Help,

A good thing about payday loans is they are a true canary in the coal mine to wondering if you have financial problems or not.

If a payday lender is the only place you can borrow money, you are in trouble even before you took out the loan.

I'm going to be brutally honest. Payday lenders exist to make as much profit as possible from people who can least afford the loans. They specifically target communities where financially troubled people frequent or pass by. 

I get the payday loan industry is a resource for last resort loans. And that is true. And while it is also true there is a good way to use payday loans, if you can repay the loan in full by the next payday, without a problem. There are many bad ways as well. Unfortunately study after study shows the right borrower is not the majority of borrowers.

Think about it like this, nails are good for some things but I wouldn't suggest driving one through your head.

Apparently you were financially drowning before you took out this loan. It's just the last nail in the coffin, so to speak.

There are some logical solutions here:

  • You can increase your income.
  • You can see if you are eligible for more benefits by visiting
  • You can reduce your expenses.
  • You can pay the loan.
  • You can default on the loan.
  • You can file bankruptcy and eliminate all of your debt and start over.

I don't really know enough from your question to know if there is any underlying debt that could even be cleared by bankruptcy. And being a single parent it might be problematic to take on a second job for additional income. You could look to cut expenses but at some point living on beans and rice is not sustainable.

So logically the probable outcome here is you will not be able to afford the payday loan and will default. The company will probably try to collect but in North Carolina they can't garnish your wages over this. However, you would need to confirm that with an attorney licensed in North Carolina.

If the payday loan company you used was the folks at then they are a tribal lender of the Tunica-Biloxi Tribe of Louisiana. These tribal lenders are in a lot of hot water right now and being sued all over the country. The tribal lender claim is they don't have to conform to state law. 

So before you freak out over the payday loan, contact the North Carolina Commissioner of Banks at 888-384-3811 and see if it was even legal for the lender to operate in the State at all. A search of the Commissioner of Banks website could not find a company named Mobiloans or MobileLoans registered to lend in the state. Anyone surprised?

While you are filing complaints, file one as well with the North Carolina Attorney General office by calling 877-566-7226. Tell them I sent you.


Steve Rhode
WRAL Get Out of Debt Guy

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  • Inside The Beltline Sep 12, 2013

    What saddens me is that our current legislature is likely going to allow pay day lenders to come back into North Carolina next year. It started in committee this year, likely will go to a vote next year.

  • Inside The Beltline Sep 12, 2013

    I would also suggest immediately go to your bank and sign a document to prevent anyone from automatically having money taken out of your checking account. This will alleviate the worry of them continuing to take money from your account.

  • HANS FOR PRESIDENT!!!!! JK Sep 12, 2013

    Furthermore, who's fault is it when someone says "my last paycheck didn't get me to the next one. I know, I'll borrow money and they can take it from the next, already not enough check, making it even smaller". Fine print or not, you have to question that logic. Sometimes it is your own doing

  • HANS FOR PRESIDENT!!!!! JK Sep 12, 2013

    @rachel, once one hits payday loan status they have already been given the "send a check" chance and blew it more than once. People seek out these loans either when they have trashed their credit or they don't cash flow for another payment. Either way, borrowing more money isn't the answer. Payday loan companies are a rip off to say the least, but as long as people need a band-aid they'll be around. All that said, the fine print is there, just rarely (never) read. They see "APPROVED" and give up the numbers. They consumer doesn't lose though, they already have bad credit so they'll walk away from another one. The bank usually takes the loss on a charged-off checking account

  • imsosorry Sep 12, 2013

    I suggest, if you are eligible, contact your local SECU.They offer payday loans at a lower interest rate or you may can even qualify for a small personal loan with a lower payment to get you out of this mess.

  • babbleon1 Sep 11, 2013

    Good luck to you. You're in a tough spot, with a kid and other parent is absent.

    I think the Debt Guy has given you some good, solid advice here. Don't be proud - do what you need to do to get by and support your child.

    The only thing I would add is that if you choose to try for more education, go to an NC community college, not on-line. Many of the on-line schools are in it for the money and will suck you dry.

    If it helps any: A close friend of mine is a single mom and struggled for years. Student loans, no child support, dad became an unemployed alcoholic, relatively low-paid jobs. Her daughter is now starting at community college, possibly to become a nurse or lab tech, she has gotten more training and better jobs, and her debts are manageable now.

    It can get better, and I hope it does for you.

    DEBT GUY: I'm impressed, and I read a lot of columns like yours. This is the first time I've seen someone look at the whole financial and legal picture.

  • sunshine1040 Sep 11, 2013

    You are a single parent sorry but it still takes two to make a child so get the other parent invovled in taking care of his or her child. And please read contracts before you sign them. If you have a problem with reading start helping your child with homework and improve your reading skills. Pay day loans are and have been nothing but a rip off to get the poor a lot deeper in debt

  • rachel Sep 10, 2013

    part two- remember-its simple for them to take the money-even if they make an "error" in how much they take-the fight is on you to prove someone who had direct access was not authorized to take what they did. If the payday lender is hurting you and not willing to negotiate the terms-move whatever direct deposits you get to a savings account, send a note to the bank electronically denying this payday agency the right to direct withdrawal of funds and leave nothing in that account for them to take. They have no reason to negotiate with you as long as something is there for the taking. Eliminate their power.

  • rachel Sep 10, 2013

    Another bad thing about these loans-they insist on the ability to put their hands into your bank account-there is no "send a check", or one time debit website or anything where you, the borrower, has the ability to control how this loan is repaid-they simply take their money and what is left is yours to live on. I just cannot adjust to the idea that some anonymous lender, in some far off place, would be given my bank numbers. Whose bank account is it- yours or who ever wants the number? With more and more employers insisting on direct deposit, it behooves people to guard that number-no recurring debits, no loan payments-nothing the account holder cannot have the final say on for payment and the time/date of that payment.

About this Blog:

Steve Rhode has had careers in opthalmology, real estate and as the head of a nonprofit debt counseling firm. On his blog, he offers hard-won, free advice about getting out of debt, consolidation and making the right choices as you manage your money.