Since the rates for payday loans typically ranges from $15 per $100 borrowed up to $30 per $100 borrowed, it can look cheap to the layman.

However, the truth of it is that since the loan terms are usually short (from a few days to 2 weeks), a $15 loan fee on a $100 loan can mean an interest of 400% to over 1000%.

This is extremely expensive when you compare it to your typical loans. Because of this high interest rate, the use of payday loans can be quite controversial. Different states have different regulations regarding their use to help protect consumers.

If you need to take a payday loan, only do it if you have no other measures. And make sure you pay off the loan when it is due and do not extend it if possible.

Otherwise, you might find yourself falling into a vicious cycle and getting into a debt trap.