Get the Facts Before You Borrow: Payday Loan 101

Written by admin on March 28th, 2011

The current economic climate, the acquisition of alternative is the money to come to an end with the ever growing need. Some of the options include borrowing money from friends/relatives; cash loans to employers; pawning personal effects and payday loans. Also known as check/cash advance loans or deferred deposit check loans payday loan, the most popular of them. As the cultivated, popularity, more and more people want to know just what the payday loans , and if it’s appropriate to their situation.


Loan payday loans unsecured, short-term anywhere from a few hundred dollars to fifteen hundred dollars in some cases. Borrower loan guarantees are generally experienced a personal check for a specific amount of money to their accounts from site against future remuneration. Payday loans are aimed at helping in situations when you need fast cash for unexpected bills or emergency even comes through your cash or available.

Payday loan is a revolving line of credit. It is short and this is a key factor for this type of loan. The idea is to be held to cover small bump on the road or to smooth out any rough edges to your next financial payday. If you think of the loan payday as a way to remedy the much bigger financial problem, advice is stop! Payday loan could create greater problems, traffic when used as part of the overall situation of the troubled cash flow.

So, a payday loan?

The most important thing to remember about Payday loans in a timely manner, or in excess of the amount of the credit is equal to the probability that they back crazy is sure to avoid paying fees, should you pay! Credit to make up a large debt and financial dilemma at the time of pay will fail.

Most loans have a period of four to eighteen days refund depending on the terms negotiated with the lender. Refund and the method of repayment schedule is organized at the time when the loan is disbursed. More often than otherwise, the borrower shall agree to pay the loan in full cash or before the due date. In addition, some lenders may choose to collect on the loan applicant post-dated check of borrower against his account by a mutual agreement to date.

With payday loans is not a fixed rate of the fee calculated in reimbursement for each loan, paid. The average rate is $ 15.00 to $ 20.00 dollars per $ 100.00 dollars borrowed. Due to the nature of the quick turn around time of payday loans, the annual percentage rate or APR is generally very high. It is not uncommon for (APR) 100%, 200%, or even as high as 400% in some cases.

If a borrower is able to repay a loan at the scheduled time, the lending credit institution agree rollover the loan allows more time for repayment. Duty drawback to rolling a loan is that the additional fees are added to your account. For example, if the fee to borrow $ 100.00 $ 15.00 and borrower rolled over loan three times, then the new fee would be $ 60.00. It is the original $ 15.00 fee plus three times the fee itself is added to every $ 100.00 borrowed.


Generally, the only main requirement is to obtain a payday loan. Your business is your warranty you will be able to repay the loan. It is expected that he will receive a paycheck, so the money to cover the loan. Isn good credit … Unnecessary or even required for payday loan approval. Lending institution only want to work and have steady income. In essence, your job is your warranty

Getting a payday loan is really is a simple procedure. You apply, and if approved, sign paperwork shows promise to repay the loan on the terms of lender. Be sure to take the time to read carefully the terms of the loan and don’t be afraid to ask questions about what these terms mean. Typically, the type of contract is written in a jargon legalized, finance is not understandable by the average consumer.


If you’re feeling, the lender  representative is not able to fully answer your questions, please, say yes! If the conditions of the loan are not unclear, do not take account of the loan until you fully understand them. The teacher always said that the only stupid question is the one you don ‘ t ask.  This is true! Again, if you do not understand all the terms of the loan, do not sign the paperwork until these terms have been fully explained to you. Otherwise you will be legally bound by these terms, which could be disastrous for you forfeited if you fail to act in accordance with the terms of the loan. We like to think that each of the above, the Council, but not all lenders are. Unfortunately, there are unscrupulous lenders out there who want to make to your detriment.

It has been recorded by the NAACP and the Ministry of Defense offices, loan payday has strategically opened offices near military bases and in the area socio-economically disenfranchised by the population is to Afro-American and Hispanic, many financial institutions that famous consumer groups and civil organizations will all be able to close offices loan payday, but their efforts to date have been successful.


Used by reputable lenders often strict directives many people in the cycle of payday loans because their are caught getting immediate benefits. When emergency situations occur and cash is required, loan offer companies payday fast, hassle-free cash. More often than not, most have no minimum credit requirements and do not perform background checks. In most cases all that is needed to secure a payday loan is a current pay stub proof of a current account. In this case, payday loans and cash advances outstanding consumers offers financial options in an emergency. On the other side, more and more people are trapped in this vicious circle of the bond to financial ruin may lead. This is not good, especially when you consider the loan avert a financial disaster was probably removed in the first place. With pre-and disadvantages like this it would seem that the best advice is if you absolutely must, but not so with extreme caution to lend.

Proactively is probably the best strategy, or holds a conventional wisdom, “an ounce of prevention is better than a pound of cure “. Honest look at your family finances and come up with new ways, it is not necessary lend. Consider trimming, fat from your budget, pledging to save a little money from each paycheck, and the reduction of the credit card and revolving debt.

Tags: , , , , , , , , , , , , , , , , , , , , , , ,

Leave a Reply