"Need cash till payday? Get up to $500 instantly!" No doubt you've seen newspaper ads touting fast cash to tide you over until you get paid. But if you think getting a loan against your paycheck is a good idea, think again. In 2002, consumers paid $4.3 billion in fees to borrow about $25 billion from payday lenders. Such lenders typically charge service fees of 15 to 30 percent of the principal (or $15 to $30 on a $100 loan), says a report by Consumer Federation of America (CFA), an advocacy group in Washington, D.C. The group found that these schemes prey on cash-strapped folks who get trapped in a cycle of dependency on the loans.

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