APR

The Cost of Payday Loans

Payday Loan blogger

You need a cash advance immediately, but are too shy to ask
relatives or friends, and are scared of the paperwork involved in a bank
loan. Shed all your worries, for help is a mouse click away in the form
of payday loans. Payday loans are one of the most convenient ways of
getting a cash advance today with practically no paperwork or other
hassles.

Defining Payday loans

Payday loans are a short-term
cash advance, when it is needed the most…usually between paydays!
Payday loans are a great way to get some cash to tide you over to your
next paycheck. The goal of payday loans is to assist you with finances
to meet that unforseen requirement. The money is given as a cash advance
and is directly deposited into your personal checking account, after
which the cash advance funds, plus a fee, are taken out of your account
at the end of the loan which usually is your next payday.

However,
a payday loan is no substitute for long-term financial planning. This
cash advance should only be taken to meet urgent financial needs until
your next payday. It is only in emergencies that payday loans come in
handy. Payday loans also bail you out of situations of bounced checks
and late payment penalties by making the appropriate cash advance
available.

Understanding The Cost Of Payday Loans

Forewarned
is forearmed! So it is with payday loans. If you know what this kind of
cash advance will cost you, you will be in a better position to weigh
the pros and cons of opting for it. This way you will also know exactly
what amount you need to pay back to the payday loan companies.

Your
first step should be to find out the best rate of payday loan on offer.
Whichever payday loan company you may choose you must know what will be
the fixed amount that you will owe upon completing your payday loan.

Usually
most payday loan companies charge around $20 to $30 per $100 of cash
advance. To ensure that there are no ambiguities, insist that your final
payday loan amount is spelled out in dollars and cents. This will help
you know what you need to pay, when your payday loan is due.

To
judge the best deal, go for the payday loans company that is offering a
lower APR. Usually, most payday loan companies provide a cost-breakdown
per 100-dollar increments that coincide with the rate.

Furthermore, most payday loan fees are based on the
duration of the cash advance. The standard APR for most companies falls
into the 400 percent range. As an example, suppose you were to borrow
$100 at a fee of $20 for a 2 week period and if you did not pay if for a
year, your service charge would be $520 for a 520% APR. To which you
need to remember to add the original $100 that you borrowed.

There
may be a situation where you are unable to repay the full amount of the
cash advance to the payday loans company. In such a situation, the
payday loans company generally charges the payday loans finance fee and
defers the principal payment over a longer period of time, usually
another 14 days.

The Other Hidden Costs

There are several
hidden costs in a payday loan! Remember, if you are unable to pay this
cash advance and you happen to lose your job, the clock does not stop.
If you default on the cash advance, which includes the principal plus
interest, the payday loan company will reclaim the entire amount plus
all the interest accrued on this loan. A payday loan company may
exercise a number of options to collect this cash advance:

�Sue you for the funds.

�Use a collection agency.

�Enter your details into a bad credit database which may limit your capacity to cash/write a check for commercial purposes.

�File a legal complaint for bounced-check charges that may leave derogatory information on your credit file.

By
now, it should be clear that it is not prudent to go for payday loans
without being aware of the repayment structure. To play it safe, make
sure that the cash advance is repaid on time to the payday loans
company. Read the fine print before you sign the agreement and
understand the worst-case scenarios before deciding to take a payday
loan. Once you understand the costs involved in obtaining a cash
advance, you are a step nearer to fully enjoying the benefits of payday
loans!

Key Concepts Of Payday Loans Online

Payday Loan blogger

Payday Loans are short term loans which are used to cover unexpected and emergency financial crises. But one should not use it to manage long term debt crises. Loss of jobs and the catastrophe due to this should not be dealt with Online Payday Loans. Repayment commitments are not flexible enough to make room for one’s long term income crisis. It is popularly known as Payday Loan or bad credit loan also. But whatever their nomenclatures are, they work on the same credit principles which provide quick access to relatively small amount with a normal repayment period of 15 days.

Repayment is automatically debited from the bank account, with the amount and the interest calculated, on a given date agreed upon through Online Payday Loan Scams transaction. Basic requirements for a quick cash advance loans involve minimal age of 18 years with permanent employment status. An active bank account with direct debit operation facility is also needed.

Besides these, particular lenders have their own eligibility criteria with reasonable restrictions and exclusions. If one shop around, one can easily find a particular lender with custom made terms and conditions that suits one’s credit necessities. Honest and verifiable information should be given to get access to your . Many companies outright reject applications which has doubtful data. Lenders also perform credit check and pertinent information via social security code. So a good credit history is also necessary to be sure of any credit.

For getting approval, one also is aware that loan repayment issues are important aspects. Carefully read the conditions applicable while paying off. Otherwise one can land in an embarrassing situation.What is the interest rate for Online Payday Loans?Payday Loans Online offers liquid cash without putting down any collateral. Legislation of different countries has been keeping vigil on this Instant Payday Loans Online as the interest rate is very much high.

To have control on the excessive and unreasonable interest rate on Payday Loansome jurisdictions have set limit on the APR alias Annual Percentage Rate. Still the interest rate is surmountable if repayment is done according to deadline. But if a borrower misses the deadline to repay the Online Payday Loans then he/she has to pay interest regarding rolling on loan which is as much as 200% sometimes. In USA if an applicant of Online Payday Loan borrows $300 for 30 days, then his payable amount is $375, that suggests Interest of $75, Interest rate (pa) is 1737% APR (variable).

Payday Loan Lender Online Comparison Before Getting A Loan

Payday Loan blogger

Online payday loan lenders offer unsecured short-term loans where the borrower isn’t expected to provide collateral for the loan. For this reason, payday loans are considered risky on the lender’s part which makes interest rates and fees on these loans typically high. Although some consumers choose to stay away from this type of borrowing option, others don’t hesitate because they know they can get a payday loan fast and without a credit check.

Unfortunately, there are just some circumstances in life that leave people with no choice but to go ahead with getting an unsecured loan. This is especially true when there are expenses that that are not part of the monthly budget. These expenses could come in the form of emergency vehicle repairs, unexpected hospitalizations, urgent repairs in the house and even unexpected visits from family or friends.

Just as in any decision you make in life, taking out an online payday loan requires some thought. Borrowers should make sure to compare the offers of lenders before getting online payday loans so that they will make informed decision as to which lender can give them the best offer. The reason for this is that payday loan lenders online offer different products and have different interest rates as well as repayment plans.

A lot of payday loan borrowers no longer care about the annual percentage rate of interest (APR) charged by their online payday loan lenders. The reason for this is that payday loans are only for a short duration of time, mostly to be repaid within a one-month period. However, knowing the APR for the loan you are getting is significant so that you will know whether you are getting the best deal from your lender. You see, the APR allows you to see the true cost of the loan you are getting compared to other options you have available.

For instance, if you need $300 for an emergency repair in your home’s sewage system you can consider two options: first, you can take a credit card cash advance with an 18% interest rate and second, you can take a payday loan cash advance for a two-week period with a 15% interest rate. At first glance, it would seem that the payday loan is the better option because the interest rate is lower. However, you have to remember that the loan is only for a 2-week period. In reality, a two-week period with a rate of 15% actually has an APR of 390% (that is 15% multiplied by 26 2-week periods in a year).

Don’t be fooled by the “low interest rates” advertised by online payday loan lenders the next time you find yourself in immediate need of cash. The US Federal Reserve Board require all lenders, including payday loan lenders, to disclose their APRs so take advantage of this regulation and demand for its disclosure at all times because this requirement was placed there by the Board to protect you as a consumer.

Payday Loans, A Viable Option

Payday Loan blogger

What are payday loans?

Payday loans are short-term loans
that are extended between two pay days. A payday loan is normally
provided for 14 days. The borrower, on acceptance of the loan
conditions, provides a check favoring the lender as security against the
loan. On the due date, the lender deposits this check to recover the
loan dues. The due date is generally the next pay day of the borrower.
No credit checks are conducted for granting payday loans. Therefore, the
FICO score of the borrower is irrelevant. It doesn’t matter whether the
borrower has a bad credit history, or has no credit history, or has
declared bankruptcy.

Qualifications for payday loans

To qualify for a payday loan, the borrower needs to fulfill all of the following conditions. There are no exceptions.

o You must be a US citizen.

o You must at least 18 years of age.

o You must be at a full time job currently and must be at this job for at least three months.

o You must either have an active checking account or a savings account.

o Your after tax salary should be at least $ 1,000 or you must have a fixed income of $800.

Cost of payday loans

Payday
loans carry a very high cost. Generally the lender fees for a $ 100
payday loan is anywhere between $15 and $25. It should be remembered
that this fee is for 14 days as the loan itself is extended for these
many days only. If one considers the cost on an annual percentage rate
(APR) basis, the average is 391%, which by any standard is exorbitant.
By law, it is mandatory for the lender to specify the APR to the
borrower. Many lenders do compare the cost of payday loan against other
forms of financing; but the common denominator of such a comparison is
that all of them are very expensive.

When to avail of payday loans?

Payday
loans should be availed only during emergencies. Considering the fact
that the cost of carrying a payday loan is very high, it should be a
resource of last resort. If one implements good budgeting techniques and
has a good financial plan, the need for borrowing by way of payday
loans can be minimized. Moreover, one must ensure that a payday loan is
paid on time. Payday loans should not be rolled over or extended as
within no time the borrower will find himself or herself in a debt trap
where money may have to be borrowed just to repay the interest.

Profile of a payday loan borrower

o A
typical payday loan customer is between 25 and 40 years of age with an
annual income anywhere between $ 25,000 and $ 50,000.

o According to the US Census report of Year 2000, the results of the payday loan borrowers survey are:

22% of those surveyed hold a bachelor's degree.

51% of those surveyed have a retirement savings plan.

In excess of two-thirds of those surveyed have a savings account.

More than two-thirds of those surveyed have an annual income of at least $ 25,555.

Why are Payday loans popular?

They are popular for a number of reasons such as:

o Credit checks are not required. The personal check that you make payable to the lender acts as security.

o Approval is quick. If all the necessary documents are submitted, your loan application maybe approved in minutes.

o
The paperwork involved is simple. Generally one or two
documents would suffice which explains the loan process and your
obligations.

o The repayment process is without hassles.
The check submitted as security is encashed on the next payday by the
lender. You could extend the loan to subsequent paydays for a fee.
However this is very expensive.

o Easy availability.
Payday loans are particularly appropriate for emergency situations
provided the amount required is small and one is willing to bear the
high cost of the loan.

In summary, payday loans might be a viable
option if you need cash and need it fast. You still should be careful
who you are working with to obtain your loan. If you don't need money
right away, there is probably a better solution for you.

How To Apply For Online Payday Loan Which Much Popular Compared To Other Traditional Loans

Payday Loan blogger

It is impossible for anyone to predict about the finance conditions and the stability. You may face the financial insecurity in your hectic routine of your life at any instance of time. It is recommended that payday loan is the supreme alternative for your finance. It will be favorable for you to deplete the financial difficulties where you are going to enjoy the financial benefits in real. There are several online lenders available who deliver the efficient loan services to the borrower.

If you are seeking for an urgent financial solution for a short period of time, then payday loan will be the optimal option that can lead you to improve your finance. It is a perfect finance available for a short period of instance and is also available for you on the right time. Online Payday loans are an excellent option compared to other traditional banks where it is hectic procedures of loan application and very often it gets approved. These hectic procedures of the banks make the customer to trust the banks finance. There are several online payday lenders available in the market.

Online payday loan lenders UK is a quick fix alternative of finance for you to plan short cash help from the lenders. It is available according to the needs of the borrowers as we can plan our repays according to our needs and requirements. It is unsecured short term loans instant accessible loans compared to any other it is available most quickly. This is the reason why payday loans are much popular compared to any other available loans.

It is quite natural that everything has its own pros and cons and payday loan also has its pros and cons. There are lots of pros available if you are looking for a financial backing to bridge the gap between the paydays or need cash in emergency. Online payday loan has made loan procedure short and hassle-less compared to other traditional lenders this lender doesnt ask for documentation or any paper works.

Online application of loan has become the most preferred option by the borrowers because of its simple and hassle-free online application form. Online application form consists of personal informations which refers your credibility to the lender. If you are a person with higher credibility then the lender will offer you several schemes and repayment relaxation for your loan.

The payday loans have several cons too. Payday loans are the higher APR loans compared to any other loans. The interest rates are much higher as compared to other loans. If you are not planned before you apply for any payday loans then you are going to be trapped with the repayments. You need to control your unwanted expenses so that you are able to pay the repayments on time.