Payday Loans: What You Need To Know

Mar 18, 2016


Payday lending exists to assist individuals with unforeseen expenses. Maybe your bank is closed, your car gets a flat or an emergency arises. It is very important that before taking out a payday loan, you continue to the article below to learn about some tips that will help you make a wise decision.

When you acquire a payday loan, make sure it is paid back by the due date instead of extending it. When you extend a loan, you're only paying more in interest which can add up quickly.

Don't just get a payday loan from the company that is geographically closest to you. You certainly do know your neighborhood, but if you do some research on other companies in your city, you might find one that offers better terms. With a bit of research, hundreds can be saved.

Before you pick a payday loan lender, make sure you look them up with the BBB's website. You will find many shady companies that will scam people who are truly hard up. Always make sure you are dealing with a legitimate and reputable company.

Look around for the lowest interest rates. There are payday loan companies you can visit, but you can also find some online. Payday lending is a highly competitive industry, with lenders trying to undercut each other on price. There are also lenders who give new borrowers a price reduction. Check all of your options prior to choosing a lender.

Avoid companies that are simply brokers for another company because it will cost you more. By taking an indirect route, you will have to pay more in fees because the lender is paying himself something, too.

If your loan's repayment date arrives and you don't have sufficient funds to pay your lender back, call the lender and ask them to move your payment date back. Payday cash advances can often give you a 1-2 day extension on a payment if you are upfront with them and do not make a habit of it. Understand, however, that you will have to pay interest.

If a payday loan in not offered in your state, you can look for the closest state line. You may be able to get a loan in another state where the loan is legal. Since money is processed electronically, you will only need to make one trip.

Don't sign up with payday loan companies that do not have their interest rates in writing. Be sure to know when the loan must be paid as well. Any company not willing to share this information could be a scam that charges extra fees.

Make absolutely sure that you will be able to pay you loan back by the due date. Accidentally missing your due date could cost you a ton of money in fees and added interest. All payday loans should be paid in full by the due date.

Don't panic if a payday lender asks you for your account number from your financial institution. A lot of people don't want to share this information so they fail to get the loan. Remember, you need to have the means to pay back the lender, that is the entire point of the loan.

Learn everything you can about all fees and interest rates before you agree to a payday loan. Read the contract! It's common knowledge that rates for payday advances are extremely high. They may also tack on administration fees as well. The fees you might incur can be hidden in small print.

Always borrow the smallest amount that you need and that you know you can realistically pay back. More often than not, you'll be offered a loan that is greater than the amount you need and accepting it will only make it harder to pay back down the line.

When you are in a multiple payday loan situation, avoid consolidation of the loans into one large loan. It will be impossible to pay off the larger loan if you can't handle small ones. Talk to the lender about lowering your interest rates so you can pay it off more easily.

Having to obtain a payday loan usually comes unexpectedly because you have some kind of problem like a medical emergency. Perhaps the rent check must be written prior to payday. The purpose of a payday loan is to help make ends meet, but they must be approached with great caution. Remember what you have learned and your payday loan experience should be a painless and beneficial experience.