Don't be tricked into applying for an online payday loan

It quoted an unnamed spokesperson for the company as saying that "many of our lenders" do not perform credit checks and that consumers with bad credit still can get a loan.

As with all payday loans, however, this can lead to a bottomless pit of debt. The problem is that you're borrowing against a future paycheck. When that check comes in, you may not have enough to pay off the loan or to cover new expenses.

And so you take out another loan. Before you know it, you're trapped in a perpetual cycle of high-interest payments.

A close reading of NeedRapidCash.com's privacy policy reveals another potential pitfall: You can kiss away your personal information.

The policy makes clear that in filling out a loan application, you'll be submitting your name, address, email address, assorted telephone numbers, birth date, Social Security number, financial account information, income information and employment information.

Even though NeedRapidCash.com says that "your privacy is important to us," it proceeds to spell out that your information can be sold to others, including direct-mail marketers, email marketers (read: spammers) and telemarketers.

The privacy policy also stipulates that NeedRapidCash.com will keep your information in its databases "for future instant messaging, telemarketing, SMS text-messaging, emails or postal mailings," and that "you may be contacted in any manner contemplated in this section even if your number is found on a do-not-call registry or similar registry."

Nice.

Complaints about payday lenders and lead generators can be filed with the Consumer Financial Protection Bureau and the Federal Trade Commission.

Meanwhile, pending legislation in the U.S. Senate would ban lead generation for online payday loans. The Stopping Abuse and Fraud in Electronic Lending Act, called the SAFE Lending Act, also would require online lenders to abide by the laws of the state where their customer resides.

This is an important bill and would provide helpful consumer safeguards. While it makes its way through Congress, though, the smartest thing you can do is walk away from any pitch that tries to sucker you into applying for an online payday loan.

These are eel-infested waters, and you don't want to swim there.

David Lazarus' column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5 and followed on Twitter @Davidlaz. Send tips or feedback to david.lazarus@lattimes.com.

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