When you are falling behind on payments, you might be tempted to go online for a payday loan.  However, you should be careful about the high costs of online payday loans.

Some online payday loan lenders are scrupulous by disclosing the actual costs of the loan and obeying the law.  However, there are some online payday loan lenders who are not so forthcoming.  The Federal Trade Commissions recently sued several online payday lenders for violating federal laws.  The online payday lenders allegedly lied about the actual costs of the loan, required borrower to allow them take money from their bank account automatically, threaten to sue and arrest borrower for nonpayment.

In that case, the lenders required the borrowers give them their bank account information so that lenders can deposit the funds and automatically withdraw funds for payment.  The lenders told borrowers that there is a one-time fee.  However, the lenders ended up withdrawing funds multiple time from borrowers' bank accounts and charge a fee for each time.  The lenders misrepresented the terms of the loans and threatened to sue and arrest borrower for nonpayment.

Another caution is you should be careful about sharing personal information online to ANYONE.  Personal information collected can be sold and could lead to identity theft and unauthorized charges on your account.  Even if you do not click on "Submit" to complete the transaction, your information can be captured through keystroke logging – a program used to see and store everything you enter on application.

The costs of the online payday loan can be high which can spiral out of control when the loan become due and the borrower has insufficient funds in the bank, costing borrower overdraft fees.  Some borrower panic when the loan becomes due and take out another payday loan to pay the previous loan, which results in additional fees.  This can get out of hand and should be avoided.

More information about online payday loans can be found at the FTC website  http://www.consumer.ftc.gov/articles/0249-online-payday-loans

If you have unmanageable debts, you should consult an experienced bankruptcy attorney.  Chapter 7 Bankruptcy can be used to eliminate some debts, which makes available some income to pay for debts that cannot be discharged or eliminated in Bankruptcy.  Or a Chapter 13 Bankruptcy can be used to save your house from foreclosure and allow you to catch up on mortgage arrears over 60 months – avoiding the high cost of payday loans.  Chapter 13 Bankruptcy can also reorganize your IRS tax liability or stretch out your car loan payment to avoid repossession into a 60 month payment plan.  Chapter 7 and 13 Bankruptcy can reduce your debt.  The benefit of Chapter 13 Bankruptcy is that it can put your secured debt and priority debt into a 60 month payment plan without having to resort to high interest loans.  Muoi Chea Bankruptcy Attorney has successfully provided debt relief to consumers and business owners throughout Northern and Central California with Bankruptcy offices in Sacramento, Stockton, and Fairfield, California.