When it comes to short term cash flow solutions, there are very limited options for folks to consider. Payday advance loans are an excellent way for people with lousy or no credit to get a quick solution to their money emergency.customers must protect themselves, though. If not equipped with the right knowledge, payday loan customers can find themselves in even more trouble. In reality, successful loan shopping comes down to one very important thing – finding the most reputable payday loan companies available.
How to Pay Lower Fees
There is no way to find an incredibly low fee on a payday loan. Simply put, you will have to pay heavily for the right to borrow cash in a short amount of time. You shouldn’t have to worry about paying over the top fees on your short term loan, though. New Mexico recently passed legislature capping the amount of the fee that a payday loan company can charge. They join a growing number of states that is looking to protect the consumer from exorbitant fees.
If your state has passed one of these laws, then you can thank them for protecting you against outrageous finance fees. In reality, finance fees are fixed among the major payday loan companies. Payday loan customers will look to save money on the other fees that can leave a huge hole in the wallet. As a part of the payday loan agreement, you may be asked to provide a check or your checking account information. This makes repayment of the loan very easy when payday comes around. The flipside of that is that if you happen to bounce that check when the loan is due, you will have to pay huge fees. Depending upon which state you’re in, fees can vary. You won’t want to pay the returned check fee and associated fees that companies are allowed to charge under the law when you make this sort of mistake.
Qualifying for, Regardless of Your Credit
Much of the appeal of a payday loan comes from the fact that these loans are often the only option available to people with bad or insubstantial credit. If your credit is shot, you probably don’t have the option of using a credit card for a quick cash fix. That’s where a payday loan can come in handy.
Most payday loan companies advertise that they can help you regardless of your credit status. Even if you have the worst credit in the world, you can find help. Very few payday loan companies perform a credit check on folks applying for these loans. Instead, they rely upon your employment information as a means of justifying the loan. Some of these companies require that you have held the same job for six months or more, so be ready to provide information about your current job status. Be able to provide phone numbers and check stubs from this job. As long as you have a steady job and a checking account, you can get around not having any credit.
Find a Reputable Payday Loan Company
The key to finding a reputable payday loan company is to do plenty of research and get all of the information possible. The United States Truth in Lending Act was designed to force credit providers to give full disclosure on their loans in regards to interest rates, fees, loan terms, and other items. Not only does this apply to credit card companies, but it also goes for payday loan companies. They are required by both federal and state law to give you all information if you request it.
Use the internet and check out different reviews of all of the sites. There are plenty of payday loan sites out there and each one offers something a little bit different. Use the internet to search for these sites and find out everything that they have to offer. That’s not enough, though. In addition, you will want to consult reviews from not only people you know, but also some people that you trust. If anybody in your immediate family has used a loan corporation, find out what sort of rates they paid. In addition to that, find out the attitudes of the company they used and how reliable that company might have been.
Finding a reputable company is the most important thing you can do. By choosing a good payday loan company, all of the other factors will fall into place. You will enjoy better rates, lower fees, and have the peace of mind that accompanies taking a loan from a good credit source.
Avoid Getting Ripped Off By the Payday Loan Companies
The payday loan business is generally a very legitimate one. Like with any industry, there are companies out there looking to take advantage of people and make a scammer’s buck. As consumers, it is important to safeguard against these potential hazards.
For starters, any company that asks for a fee up front before sending along any cash is one that should immediately be flagged in your mind. In addition, you should be wary of companies that offer deals that seem too good to be true. With the high rates floating around this market, people often want to look for the best deals. If a payday loan corporation is undercutting other companies by a large amount, then there is a good chance that they aren’t very reputable.
In general, research and information is your best weapon against these scammers. Online research, as well as other forms of research is essential to finding a company that won’t rip you off. Above that, it is important to use a little bit of common sense. If at any point in your dealing with a payday loan company, you feel like something is fishy, then discontinue the transaction. These folks should be asking for a good bit of information, but there are certain things that each legitimate company needs. If they aren’t asking for your previous employment record or your current employment status, then there is a chance you might be getting scammed.
Paying Off Your Loans On Time is Extremely Important
The ugly cycle of consumer debt can eventually have some pretty devastating consequences if left to its own devices. Though payday loans are a good alternative to other forms of credit when there’s a direct need for fast cash, they should never be used as a long term solution. That’s why paying off the loan on time is extremely important.
Depending on the state, there are different laws regarding how long a payday loan can run. Generally, these loans are valid for between two weeks and a month. At the end of that loan term, you must have the available funds to cover the check that you have written or else the consequences can be dire. Though a bounced check on a payday loan is not a crime, payday loan companies can use harsh means to get their money back. Their collection agencies are often much more aggressive than other credit collection companies.
Never borrow more money than you know you can pay back. If you are to receive a $500 paycheck, then getting a loan for more than that will likely cause a person to default on the small loan. From there, the cycle of debt is inevitable. Borrow only in times of great need and only receive an amount that you’re sure can be repaid. Any uncertainty in this can cause harmful problems with the term of the loan ends.
Improve Your Personal Budgeting For the Future
Payday loans aren’t a long term solution for any real problems. They shouldn’t be used as any every month way to get some quick cash. If you find yourself constantly having to get a payday advance, then some advanced budgeting is needed in your life.
Thinking ahead and planning a budget for the next month can enable you to save enough money to pay off the loan and not need another one for the upcoming month. Create a list of all of your large expenses, as well as any other smaller expenses that may be on the horizon. For the time being, sacrifice any of the things that aren’t absolutely necessary to everyday survival. In the long run, payday loans will cost you more money than any other form of borrowing. Keeping the number of payday loans that your receiver to a minimum is an important business principle.
Know Your State’s Regulations
Payday loan laws can vary greatly depending upon the state that you are in. Though it’s true that finance charges will be fairly consistent from state to state, there are differences depending upon where you live. For example, the state of Arkansas has a law limiting the maximum interest rate on a payday loan to somewhere around 17%. In Colorado, the maximum rate is almost double that. Visit nclc.org for a state by state breakdown of the varying laws. Pay special attention to the notes on special collection fees, which can vary greatly.
Many of the misconceptions regarding payday loans can be put to rest by customers who take the time to protect themselves. Payday loans are not a way to effectively manage money problems in the long term, but they are sometimes the only way to get a little bit of cash in the case of an emergency. Finding a reputable payday loan source has never been easier than it is today. Thank the government for getting involved and making regulations that keep the industry in check. If you will take the time to make a responsible decision, research the different companies, and protect yourself against outrageous fees, getting a payday loan can be a fulfilling experience that helps in a time of extreme need.
4 Comments to “Payday Loan Tips – Before You Borrow”