Numerous cash-strapped Tennesseans have actually looked to pay day loans in a down economy. But a brand new item known as a flex loan is quickly becoming the industry norm. It is an open-ended personal credit line with an impressive 279per cent yearly rate of interest.
Tennessee is among the very first states where you are able to have the flex that is new. Like pay day loans, these loans have high rates of interest. Even though those within the industry say flex loans are a lot better than old-fashioned pay day loans, both experts and customers we chatted to say you have got to be mindful because flex loans could be hard to pay back. When you are short on money, a flex loan might look like the clear answer.
However for folks like Malia Andrews, it had been the incorrect solution.
“we more or less had a total meltdown within the vehicle,” Andrews recalled, explaining the minute she understood it can simply just just take years to cover down her flex loan. She explained, “and just like $20 of my re payment would definitely the key as well as the remainder ended up being, like $300, had been going to the rate of interest.”