If a new proposal makes its way through the state Assembly in California, the cap on payday loans could increase.

That is great news for people who need payday loans. When you use a payday loan, you are borrowing against your future paycheck; basically, you are using your own money, just ahead of time. However, you must pay interest on the amount that you borrow, sometimes as much as 460 percent annually, which can leave you in even more debt if you are not careful.

The current cap in California is $300; Assemblyman Charles Calderon has proposed to raise it to $500 this year. Tom White, Whittier's chief of staff, added that: "People don't have access to money often any other way than a product like this [...] they either can't qualify for a credit card or banks don't lend this amount of money generally."