The Low Cost of a Payday Loan
Cost Of Payday Loan - Nothing To Worry About
Alice Smith
December 4, 2007
Even though the cost of payday loan is higher than the regular loans that you take from banks, the benefits of a 10 dollar payday loan far outweigh the cost. Generally speaking payday loans cost around $15 to $30 per week for every $100 borrowed. Since there is huge competition amongst payday loan lenders, you can find a payday loan with low interest charges. But for that you have to look around.
Unsecured Loan
There is a reason why the price of payday loan is higher than the price of usual loans. A ten dollar payday loan is an unsecured loan. So the risk for a lender is quite high. On top of this your credit is not checked by the lender. Again this increases the risk for the lender. Obviously you cannot expect a lender to give you money without him/her making an effort to minimize his/her risks. The high cost of payday loan like no credit ten dollar payday loan, covers up the risk for lenders.
Low Cost Payday Loans
However, you do not have to be dismayed by the talks about high cost of payday loan. Today you can opt to become a ten dollar payday loan borrower. These payday loan lenders offer first timers a low cost payday loan. You want to know how low? These payday loans would cost you $10 for every $100 borrowed. This rate is for a week. So if you borrow $100 for two weeks, you would pay $20 as charge.
Great In Emergencies
Even with the high cost of payday loan, these loans are worth it. These payday loans are best suited for financial emergencies. Payday loans are called for when you are facing a severe cash crunch and you have to deal with your immediate emergency. Your immediate emergency can be in the form of a doctor’s bill, car repair, utility bill payment, etc.
A payday loan will help you deal with your emergency by putting the much needed cash in your hands. On your next payday you can pay back the loan. If you look carefully, you will realize that a payday loan actually saves you money. The late fees on your credit card bills would turn out to be much higher than a payday loan fee. If you were unable to have your car repaired, you would have to miss work. Missing work for a day or two would definitely cost you more than a payday loan.
So in the end you can conclude, just like I did, that it makes sense to go for a payday loan when you face an emergency. Obviously you have to keep in mind that you must repay the loan on time. Plus you have to maintain financial discipline. This way the cost of payday loan would be insignificant in comparison to all the trouble that it would save you.
You might find the cost of payday loan high at first glance. However, when you consider how much it can save you in terms of late fees, NSF charges, etc. you will find the cost of ten dollar payday loan quite low and practical. Want to become a ten dollar payday loan borrower today?
Source: http://www.americanchronicle.com/articles/viewArticle.asp?articleID=44685
Interest Rates
Payday Loan Interest Rates
A payday loan is a short term loan made usually until the next payday of the borrower. The loan is non-secured except for the post dated check that is issued by the borrower. These loans usually require no credit check and can be obtained in a matter of hours instead of days or weeks. This article is aimed at the payday loan interest rates that are imposed. These rates can vary from state to state and even from lender to lender within the same state or even same city.
The payday loan interest rate is the extra fee imposed on the borrower for the ability to borrow money from a payday loan company. In most cases, the fee is set in dollars or a basic percentage of the amount borrowed. The fee, when given to the borrower in these terms, does not seem to be terribly high. However, when broken down into annual percentage rates (APR), the rates can exceed 300%. These rates usually vary from company to company, but in most cases, the companies keep their fees similar for competition purposes. Most people that are in need of money quickly pay little to no attention to the fine print that states the percentage rate of the loan.
In many situations, the loan amount plus the fees are too high for a borrower to repay at one time so they have the availability to roll over the balance. When this is done, there is always a service fee, sometimes equal to or much greater than the original service fee for the loan. There could also be a percentage rate increase on your loan. To avoid unnecessary fees, knowing that you will be able to pay a loan in full on the due date is imperative in taking out a payday loan.
A payday loan interest rate is often called an additional fee. This is to avoid some state laws which govern payday loan interest rates. Depending on the state in which the loan is originated, your rate could be higher or lower than in a neighboring state. In most states, there are laws that govern payday loans. These laws are more stringent in some states than in others. Online payday loan lenders are not always governed by the state laws in the state in which you live, so you may see a difference in an online lender and the neighborhood lender. Whichever type lender you choose, whether it be online or storefront, make sure that the interest rate is comparable to others in your area and that you are getting the best deal.
Getting a payday loan may seem like a great idea and a big help in some cases. These loans should be taken as a last resort after exhausting other means of borrowing money such as friends and family. If the loan is necessary, do research on the lender to make sure they are a reputable company with a good history in lending. Check with friends and family to see if they have had any experience with the company. Overall, just do your homework before even completing an application with one of these payday loan companies.
Finding Payday Loans
Finding payday loans is never easy these days with the exceptions that you do not live in certain states. At present fifteen states have outlawed payday loans and twenty-five additional states are working to abolish the lenders.
Payday loans are loans that extend cash until the next paycheck. Most lenders charge high fees, i.e. a few will offer lower rates. The percentage rates annually can reach up to 900%. While finding payday loans on mind stay conscious since you can put self at greater risk than what common payday loans present.
Payday loans are also known as cash advances, advances, pay loans, etc, and the loans often provide short-term support to borrowers. The loans are intended for emergency purposes only. With this in mind, only apply for payday loans when it is unavoidable. The payday loans are healthful to save on overdrafts and car repairs. While most lenders consider shutoff notices and late fees on bills an emergency, checking the resources may change the outlook.
Utility providers are more than willing to work out arrangements with customers. The providers offer low-income arrangement plans for pay, extensions to those lacking funds to pay, and pay plans. If you are pending a shutoff, state assistance is available in most states that will help get your bill paid. You may have to pay a small amount of the bill; the resources will pay the majority depending on your net pay.
The public library has resourceful tools for helping low-income families get ahead, by relieving debt. Debt consolidation is one of the alternatives available. The debt lenders however, claim to help you payoff your bills, while getting out of debt fast. The loans commonly payoff high rates of interest on credit cards, loans fees, medical and other types of bills. The issues are that most debt lenders will charge monthly fees, negotiate with the creditors who pay the lender a monthly fee for making arrangements on payments, and will charge you more than what you will owe overtime. Accordingly, you might want to head another direction.
Creating a budget is the eventual tools for saving cash, avoiding debt, and late fees, as well as overdrafts. Still, urgent situations crop up, for that reason, at what time you set up a plan make sure you have emergencies are covered. Set up a time management scheme, debt management scheme, and a stress-reducing scheme to prepare for all situations. Time management arrangements conserve time, by allocating you to learn line of attack to spend time shrewdly, while saving cash. The management schemes will facilitate a budget that coordinates with your income. Debt schemes will also facilitate managing your cash by showing you how to cut back on expenditures. The stress-reducing scheme will help you condense stress, in view of the fact that you will have finances available, the bills will be paid in full, and overdrafts will not be a concern.
If you are hunting for payday, loans are careful since the marketplace is full of swindlers. While finding payday loans read all details surrounding the loan careful to avoid problems. This will help you find the better deals. You will also gain deeper understanding of payday loans.
If you are considering payday loans to halt overdrafts, weigh out the expenses and follow a line of investigation to make sure other options are not within reach. Perchance a companion or family member could loan in the money to cover your bank account, until your next paycheck arrives. Before asking your friends, rather before taking the money, make sure your friends and family have sufficient funds to survive the month after loaning you the money. If your friends cannot loan into money payday loans might be your ultimate reach to relieve debt.
Always check your options before making a decision. Sometimes when stress is overwhelming it can make a person jump the gun and in most instances the bullet reverses and the person is the target. For more information on payday loans, visit the Internet where some loans offer better deals that other loans will proffer.
Payday Loans
What You Need to Know about Debt Collectors
Payday Loans
The title 'debt collector' is self explanatory and clearly states what such a person does. If you owe money to a lender and there has been a delay in payments over the past few months the lender may choose to either use their in-house service or employ a specialized debt collection service provider.
If it is a third party i.e. a specialized collection agency, they usually purchase your debts for less than you owe from your lender and then the debt becomes theirs. Therefore, they then have vested interests in settling the same.
Having a debt collector knocking on your door or receiving his call a number of times a day can be distressing. There is however a way out of the problem. Put in one word it is 'awareness' - an awareness of your rights and safeguards. This will control the debt collectors and not the other way around.
Debt collectors while doing their job may tilt towards being forceful and intimidating. As a defaulting borrower, you are already on a back foot. However, you can still stand firm and not give in to their demands. Here is how:
The job of a debt collector is to advise you that you owe some monies. He cannot threaten, abuse or intimidate you by threats of harm or police action.
A debt collector may establish contact with the borrower in person, via sealed mail, telephone, fax or a telegram. He cannot use a postcard as it can be read by anyone. He cannot also call before 8 a.m. and after 9 p.m., unless you agree on a time.
The first call from the debt collection agency has to be followed up by a written statement clearly stating your creditor's name, the actual amount owed and what action he can take if you do not acknowledge the money owed. This written letter must be accurate and have no false information.
Also note, the debt collector cannot contact your relatives, friends, neighbor etc unless to obtain your contact information. In such circumstances he cannot inform them that you are in debt. You are entitled to your privacy even if you are in default.
Remember you cannot and should not force the debt collectors to coerce you into making payments as per their demands. A number of collection agencies work on the premise that the best way to get the payment is to make sure that it becomes number one on your priority list. While you know you owe the monies, you have to ensure that you clearly prioritize your finances. If there is a greater and pressing need for your money, like for medicines or food then you must allocate the funds accordingly.
You can choose to directly negotiate with the debt collector or appoint an attorney instead. If you deal directly, do not feel compelled to offer private information that can be misused to force payments from you. Example, details of where you work, your personal account information and the like.
Always seek written communication from the debt collector instead of phone conversations. This will put pressure on the collector to be polite and accurate in his dealings with you. All agreed terms and conditions will also be clearly outlined. The original amount owed, along with any interests and fees should also be clearly mentioned. It is also a good idea to tape your phone conversations after having explicitly informed the collector when he calls that the same is being recorded.
If your debt collector continues with his forceful methods you have a right to redress. You can complain to the concerned authorities within your jurisdiction and obtain relief.
The best way to counter force is through knowing the facts and standing firm on them.
Pay Day Loan
Payday Loans Annual Percentage Rates
Annual Percentage Rates (APR) on payday loans can reach as high as 900%, yet in reality payday loans do not have Annual Percentage Rates. This is an outrageous figure, which should tell you that payday loans are an extreme hazard. Payday loans are a source of monies that provide borrowers revenue for times when urgent situations arise. An emergency such as repairs of car, overdrafts, medical, arrearages, etc, is the time that payday loans can become useful.
Still, other revenues are available. Payday loans that offer the lowest possible fees are ideal. If you can find a lender that will provide you a loan for a low fee, the idea can help you avoid costly fees on loans. Many lenders charge $30 per $100 borrowed, which is outrageous. Other lends will charge $10 per $100, $20 per $200, etc. The fee is affordable and reasonable on any loan.
Because payday loans have high annual rates and fees, many states are terminating the loans. Laws have shutdown payday lenders in fifteen states, and expect to shutdown other lenders in different states. In one way this is good, yet in other ways it is not.
According to few, payday loans are issued by loan sharks, which coordinate with the system. Bank lenders are costly, groceries are outrageous, car repairs are ungodly costly, and the list continues. As you can see, greed is the ultimate reason that people are suffering in this fast-paced environment.
APR fees should have more light shed on the rates. While few lenders proffer few details on the APR, rarely do they detail the rates on the loans. Lenders are obligated to disclose all information pertaining to loans in the terms and conditions and or contract. If you are considering payday loans, make sure you read all details of the loan. If the lender does not disclose fees, APR, and other details pertaining to the loan, slack off and find a different lender. You might want to report the lender, since it is a violation of the law and consumers have rights. Thus, the lender not disclosing the rates and fees is taking advantage of consumers and the law.
Payday loans are tricky only if you are not up-to-date on the loans available. Payday loans are relatively simple to explain, yet the APR are a bit more complex. The rates then of APR on payday loans are the fees attached to the loans, which estimates the annual rate of interest on the loans at a set amount. Thus, in light there is no APR on payday loans. The loans have a fee attached, that sets the amount to repay.
The borrower will take out a small loan amount, generally in the amount of $100 to $500 and will repay the debt owed, plus the balance of the fee, which in most instances is $30 per hundred, and will decrease slightly in some cases the more money borrowed from the lender.
Payday loans were intended to tie a party over until the next paycheck arrives, however many people are caught into the scam of the loans, and will begin relying on payday loans. Some view it as a way to make a living. Payday loans is designed for emergencies and not intended for surviving. The loans purpose to repair motor vehicles, pay for medical emergencies, cover overdrafts, etc, and not intended for other purposes with the exceptions.
If you are planning a vacation, some lenders will offer the loans with vacation in the emergency list. I beg to differ, since if you planned a vacation, you should already have the funds available to cover the trip and expenses. Vacations can lead to disasters, thus this is probably why it falls under the emergency list.
Payday loans Annual Percentage Rates then, is the fixed rates of fees on the payday loans, in which incur high fees when rollovers occur. In other words, if you take a loan amount of $500 you will repay around $75, unless you roll over the loan, in which you will repay $150 on 2 extended payday loans and the rates increase the more times you roll over the loans.
Advances on Payday Loans
Advances on payday Loans stretch to the next payday. The loans are apt to have severe fees attached. If you have late utility bills you might want to ask for an extension, then work with your utility providers to pay off the debt. Payday loans are intended to offer relief in emergency situations. For example, car repairs, shut-offs, late fees, overdrafts, and medical costs is a reason to take out a payday loan.
Payday cash advance loans are extended two weeks more often than not, but few extend the loans up to 18 days. At what time the fixed time of the term to repay comes around, if you do not have the funds to repay the credit you will disburse the loan fee and roll the advance over to the next paycheck. The cycle can become damning.
Once the loan is approved, lenders will deposit the notes into your checking account if you have direct deposit capabilities. At what time the advance is official you will take delivery of overnight deposits according to few payday lenders, though, most lenders deliver the cash into your checking account in two working days, except, if you apply for a loan from the land base lenders. The lenders assert the payday advances are quick and straightforward approval and the business will not check your credit. Scores of payday sites online allege the sites are confidential and secure. This is important, since if the site is not secure and confident you could be the next victim of identity theft.
Payday advances are short-term unsecured loans that tie you over to the next paycheck arrival. At what time patrons are careworn sandwiched between paychecks, the advances are on hand to lend a hand. The cash loans are one of the undemanding advances to apply. Many payday lenders nowadays are making it easier to get a payday loan. Lenders assert no faxing is necessary at few payday sites, nevertheless once the borrower is accepted, faxing may be necessary despite the lenders claims that faxing is not obligatory.
The positive aspect of payday advances is the loans are elastic and the borrower can relax since the transaction is discrete. The majority of advances are issued to borrowers to assist them in saving everyday expenditure on utilities, such as late bills or reconnection fees. Many borrowers employ the advances to cover recoiling checks and the bounce fees, which are often unreasonably higher than fees on a payday advances.
The Internet has a variety of payday loans. If you can find a loan on land base in your area it might be a better choice, since many payday lenders are confined to loaning cash, only in their area. Right now, there is controversy over payday loans and few State Reps are working to shutdown the sources.
Officials and a number of other people believe that payday lenders are gluttonous, greedy, inhumane people looking to take advantage of the poor. While this appears true if you consider the details of the loans, but payday loaners are no different from financial institutions, governments, IRS, and other sources that take and rarely give.
The fact is payday loans are cheaper than bank overdrafts. Bank overdrafts can cost a fortune, and if you take out a payday loan to cover checks you might pay a fee, but not as high as the fees, you will pay if the overdrafts continue.
If you have disconnection charges you likely will pay less than the amount of a payday loan, still, disconnections is not a good thing, so payday loans may be to your advantage.
Car repairs can cost a fortune. If you need your car to drive to work, thus payday loans may be of use. You might pay a fee for the loan, however if you lose your job it will cost you more. Payday loans is a source of relief, never take the loans for granted, since it could lead to debt problems.
For more information, visit the internet to view the different types of loans available to you.
Pay Day Loan Contracts
5 Things You Should Know Before You Sign a Contract
Security from any fraud and unscrupulous activities should be a serious concern for anyone who is into sales, lease, jobs, or any kind of services that entail certain provisionary agreement and settlement.
Whether a party is a first time or an expert person, the industry and the services that go with it presents the concerned person with risks and challenges that you cannot underestimate. Every time that a person is engaged in a commercial transaction in the society, he or she is in danger of submitting their selves to probabilities of fraudulent activities.
That is why contracts were made to ensure the security of both parties involved.
Generally, contracts are created to provide solid information about the agreement that transpired between two or more parties and that any details stated therein are bounded by certain laws and regulations. Hence, it is extremely important for a person to know the important details of the contract before he or she signs and submits to the pact.
Here is a list of some of the things people should know before they sign a contract. Knowing these will surely protect them from any discrepancies or any fraudulent activities that may happen.
1. Be aware that a contract is a legal document, bound by legal provisions and stipulations.
As defined, it is a “legally binding,” printed arrangement signed by two or more factions or groups, which entails their commitment to each other.
With the term legal, this means that any provisions stated therein are bounded by law, in which, any act, made by a particular party or all of the parties concerned, that constitutes as non-conformity to the details of the agreement will be held liable with the law.
This means that anybody could be imprisoned or held in custody with the law unless other wise the concerned party is proven not guilty.
Hence, it is important to be meticulous about the details of the contract before signing it to avoid any potential risk.
2. Make sure that you are dealing with trustworthy and reliable companies
It is extremely important to know first who the concerned person is dealing with. Therefore, it would be better if an individual or a party would try to do some investigations and background checks first before they sign the contract.
If in the event that a person or a party is in doubt, it is best to follow their instincts and forego the signing of the contract.
3. Know the fine print
The problem with most people is that they assume every detail as part and partial of the whole agreement, thinking that everything will be stated as agreed verbally, and that there will be no harm if they will not read thoroughly the fine print.
This should not be the case; otherwise, they can get into trouble with the parties involved or with the law.
People should bear in mind, that the law fully assumes that any person or entity that has agreed to sign in a contract has fully understand the details stipulated therein. Hence, there is no excuse for any party who claims that they had missed certain details in the contract.
4. Make sure that all of the details about the contract are fully stated.
This means that all information pertinent to the agreement should be stipulated clearly and completely. For example, for service contracts, be sure that the beginning date and ending date of the service is clearly stated.
5. Make certain that there are no blank spaces in the contract
Before signing a contract, concerned parties should try to inspect the document meticulously and ensure that there are no blank spaces present. This may pose greater risks if left unattended, especially if their signatures are already affixed on the contract.
All of these things are boiled down to the fact that people should be very careful about transactions, deals, or agreements that they commit to. It is relatively important to be aware and knowledgeable of the details of the contract before signing it.
You may have heard that ignorance of the law is not an excuse. This is true, therefore, it is better to be fully aware of it than to be in trouble with the law in the end.
Pay Day Loans
NEED CASH - THINKING ABOUT GETTING A PAY DAY LOAN?
Have you seen the commercials? Cute characters promise financial prosperity. Happy, professional individuals appear to regularly visit their corner pay day loan shop as proudly as cashing a check at the bank. Customers at the grocery store all recommend pay day loans as the easy solution for a lack of funds.
Could pay day loans be the answer consumers with low bank accounts have been looking for? Is there any harm in using these services? Aren't they better than using credit cards or going hungry?
WHY USE A PAY DAY LOAN?
Some individuals reason that paying a bill with borrowed money is better than receiving bad credit marks because of not paying the bill. This is understandable. However, some financial institutions are willing to make the occasional exception if contacted about the situation. Or there may be a small fee, but not a credit report made.
Using it for groceries or other items? Consider the true cost before making a decision. Compare the cost of using a pay day (or cash advance) loan to the fees charged for taking a cash advance on your own credit card. Can family help? Often those who are forced to use pay day loans are not able to repay the loan by the next pay check and that can lead to a cycle of debt and stress.
WHAT IS THE COST?
Several sources, including a consumer report by the FTC (Federal Trade Commission) and the CFA (Consumer Federation of America) state that usual the usual APR is between 350 - 650% with some as high as 780%.
A loan of $100 ranges in cost between $15 - $30. If the loan is not repaid by the pay date then it can be renewed with another fee due at each renewal. A loan of $100 can cost $60 in fees after 3 renewals.
WHO BENEFITS?
Based on the warnings issued by federal and consumer organizations it is clear that using pay day loans or cash advances from these businesses can often lead to more debt and problems. Some sites were reported to automatically roll over the loan and only withdraw the renewal fee on the pay date. Other sites surveyed by the CFA required customers to agree in contract to not participate in class action suits or to file for bankruptcy.
For those who are having debt problems it is recommended to seek no- or low-cost credit counseling from a local non-profit organization. These organizations can help with reducing current interest charges and lowering monthly payments. If the problem is budget, you should look to a financial planner who can help you to manage the money you do have and avoid using credit at all.
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