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Transcription:
John's truck broke down and he needed money quickly to repair it. He couldn't get a loan and his credit card was maxed out. So John went to a payday lender.
To get his 500 in cash, he had to give the lender a check for 575: 500 to repay the loan and 75 for fees. John didn't have the money in his account at the time, but that didn't matter. The lender would hold the check for two weeks, until the loan matures.
But after two weeks, John no longer had enough money to repay the loan. So he paid the lender $75 more to roll over his loan. This means he has 2 weeks left to repay the loan.
And two weeks later the same thing happened. John paid another 75. This gave him two extra weeks to repay the loan.
It took John 12 weeks – or 3 months – to save enough money to repay the original $500 loan. In the end, John paid 1025 when he only needed 500. It was a very expensive loan.
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