Payday loans are unsecured loans. The lender is usually at a higher risk but that is offset by the huge interest rates usually as high as triple-digit annual interest rate. Due to this, payday loans have received a lot of negative press as it involves legally lending small amounts of money at interest rates as huge as 1000% per year. A less well-publicized pay day loan is the car title loans which are marketed as small emergency loans. : http://ezinearticles.com/?Car-Title-Loans-Small-Lending-Huge-Interests&id=778842