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Search analytics firm SEMrush recently revealed that the number of online searches for payday loans bested mortgage-related queries in Canada over the last year, as reported by The Canadian Press.
New data indicated that payday loans ranked first out of 10 different types of loans, accumulating an average search volume of 29,000 a month on search engines like Google.
“That's more than 50% above what would-be borrowers wracked up in mortgage searches, which hit 18,800 a month between June 2017 and June 2018,” Canadian Press stated.
On the Government of Canada’s website, a payday loan is described as “a short-term loan with high fees that make it a very expensive way to borrow money.” It was also stated that a borrower can avail themselves of up to $1,500.
The catch? One must pay the loan back from his or her next income. “If you can’t pay it back on time, you'll face more fees and interest charges. This will increase your debt.”
“Payday loans are meant to cover a cash shortfall until your next pay. Avoid using them for ongoing costs such as rent, groceries or utility bills. If you use them in this way, you may end up in financial trouble,” canada.ca explained.
Contrary to popular belief, it is still possible to apply for mortgages even though one has acquired a payday loan. However, this might reduce chances of being approved, as some lenders see a payday loan as a risk indicator.
Interestingly, the SEMrush data comes after a year of weakening residential home sales across the nation. According to The Canadian Real Estate Association, home sales in June dropped 10.7% compared to 2017.
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