Are Payday Loans The Right Thing For You?

Mar 08, 2016


Accidents, injuries, and other unexpected calamities can leave you with incredible short-term expenses you are utterly unprepared for. Your paycheck might not always be this much and you might have to get money in another place. When this is the situation, payday loans might be your ideal alternative. You must get all pertinent information before accepting an offer from a payday loan company.

If you're thinking about biting the bullet and using payday loans, you need to realize that the amount of interest you'll be charged is extremely high. The interest could, in fact, be over 200 percent. Because of loopholes found in usury laws, companies can set essentially whatever rates they want.

There are times in life when a payday loan is the only choice that a person has to pay for an expense. It is best to avoid this type of borrowing if at all possible. Ask people you know well if they are willing to lend you the money first.

Investigate all of the fees that come along with cash advance loans. By doing this, you'll know the exact amount you must pay back in exchange for borrowing the money. Regulations on interest are there to protect you. Companies skirt these regulations by charging insanely high fees. Fees can drastically increase the final cost of your loan. This can help you decide if the loan is right for you.

When applying for payday cash advances, watch out for companies who are trying to scam you. Scammers will act like they're a loan company and will actually steal your information and money. If you are considering any company for a loan, check out their Better Business Bureau entry.

Ask ahead of time what kind of papers and information you need to bring along when applying for payday loans. Most companies require a current paystub, a valid checking account and proof of employment. Ask the company you are going to be dealing with what you're going to need to bring so the process doesn't take forever.

One thing to consider when getting a payday loan are which companies have a reputation for modifying the loan should additional emergencies occur during the repayment period. Such lenders will offer more time to pay if things get tough.

Find a lesson in the headache that is payday cash advances. When you took out this loan, you were probably furious because you had to pay almost double the amount you borrowed, due to high interest and fees. This anger can be a force for change, however. If you start squirreling away some money every pay period, you can use that money when an emergency arises instead of going to a payday lender.

Do not apply for a payday loan before considering other, less expensive options. Even with cash advances on credit cards, it won't have an interest rate as much as a payday loan. Ask friends and family for a loan instead.

Be sure to shop around when looking for a payday loan. You can find different rates and fees at different places. Sometimes you may find a site that looks like a good deal, when in fact there is someone out there that offers a better rate. Don't go with one company until they have been thoroughly researched.

Be truthful when applying for a payday loan. These loans are designed with people with low credit in mind so there is no need to artificially improve your information. There can be consequences to reporting false information that could affect your credit.

If you happen to be self-employed, secured personal loans might make more sense than cash advances. This is due to that fact that those who are self employed are rarely eligible for payday cash advances. Providers of payday advances will need to be able to see and verify a source of income, but people who freelance often have fluctuating income which cannot be depended upon.

Beware of affiliates who make money by connecting you to payday loan companies. They might show they are in one state, but actually they are out of the country. You might get into something that you will pay a lot more than what you thought you were paying.

Before you consider obtaining a payday loan, request financial assistance from family and friends. They might not be able to give you all the funds you need, but at least you'll be able to pay less for a payday loan. This will mean lower fees for you.

Don't make the mistake of taking out too many loans that you struggle to pay back. However, when you need a rare loan to help pay for an emergency, a payday loan can really help. Approach them with prudence, and you should be fine. Keep in mind what you learned today. It could come in handy one day.