Posts Tagged ‘payday loan company’
How Payday Loans Work
Imagine this: you get paid once a month, at the end of the month. But three weeks into the month you find you’ve been invited to a great weekend bash at a friend’s cottage. Do you say no because it doesn’t fit into your budget? Or is there something else you can do to help you get a bit of extra cash in order to enjoy the party?
Payday loans are a highly convenient way to get money if you find yourself short of cash before payday. Payday loan companies can operate like retail stores, which you can probably find on a busy street, and, more conveniently, on the Internet.
How does it work?
Say you need an extra couple hundred dollars to tide you over until payday. Just go online and search for a payday loan company. Their web site will take you through a quick and easy process that will give them all the information they need to get the process started. For example they’ll need information such as your name and where you live and who you work for.
From there, you just sit back and wait! These payday loan companies go out in search of lending institutions who want to lend you money. Some lending institutions will request you to fax information to them while other lending institutions won’t require it at all. In many cases, you can choose whether you want to fax your information to a lending institution. If you are willing to fax your permission to a lending institution, your options will be much more open than if you choose not to. However, by choosing not to fax your information, that does not necessarily mean that you won’t find a lending institution.
Instant Payday Loans – How They Work
A payday loan allows consumers to borrow up to $1000, depending on their state’s laws and the consumer’s monthly income. Payday loans are intended to be short-term loans, helping get through a financial emergency until your next payday. Online payday loan companies add convenience to the process.
Payday Loan Process
Once you have found a payday loan company, you will need to fill out an application that includes your contact information and monthly income. You will also need to work out a repayment plan. If you use a traditional payday loan store, you will need to write a postdated check that the lender holds onto. Online payday loan companies will deduct the payment from your checking account automatically.
When your application has been submitted and approved, you will receive your cash advance. A traditional lender will issue you a check, while online companies wire the funds to your checking account. Your repayment will be due on your next payday, or you can extend the loan for longer by paying additional fees.
Payday Fees
Payday loan lenders charge fees just like any financing company. Fees include a process fee and interest. To make comparison shopping easy, the federal government requires lenders to post an APR, which includes both fees and interest. This is the rate you would pay if you kept the loan out for an entire year.
If you compare the APR of a payday loan to a mortgage, you will see a huge difference. However, payday loans are only intended to be used for a couple of days, so your actually fees will be lower. The APR is still a good way to compare payday companies to find the best deal.
Online Payday Loan Lenders
The Quick Payday Loan – Taking A Look At The Loan Agreement
A payday loan will require you to sign a loan agreement, just like with any type of loan. Before you sign though, you should take the time to read through all the fine print. Not only will you learn your rights, but there is also valuable information to be found in the forms.
Lender’s Contact Information
In your loan agreement you should clearly see the lender’s contact information. This should include company name, address, and phone number. They may also include a fax number or email address. Through this information you should be able to contact the lender with any questions.
List Of Fees And Interest Rates
Your loan agreement will also include a list of fees and interest rates. You will find the APR, which should have been disclosed before signing the agreement. You will also find exact dollar amounts that you are to pay for the loan.
Fees for late charges or bounced checks are also included. These fees can really add up, and it is better to work with your lender to renew your payday loan terms than pay large late fees.
Payment Obligations
You are expected to repay your cash advance loan, usually on your next payday. However, you may also choose to take several weeks to pay back the amount. Whatever the terms, they should be clearly listed out in your loan agreement.
You should also see the statement: “You cannot be prosecuted in criminal court for collection of this loan.” What this statement means is that while you can’t be arrested for not paying your loan, you can end up in civil court. Through the court, fees for the loan and court costs can be collected by garnishing your wages, placing a lien on your assets, or other means as determined by the court.
The Easy Payday Loan – Why Payday Loans Are Easier To Get Than Credit Cards or Personal Loans
Payday loans are easier to get than credit cards or personal loans since there is no credit check involved. And because payday loans are meant for a short period, usually 30 days or less, payday companies don’t require an extensive background check.
No Credit Checks
Credit checks take time – several days in fact. And when you borrow large amounts, like with a car or home loan, it makes sense for a lender to make sure you aren’t too high a credit risk.
Cash advance companies deal with much smaller loan amounts, between $50 and $1500, so they can afford to lend to anyone with a regular source of income. Not only do you not have to worry about your credit score with a payday loan, but you also reduce time spent processing your loan application.
Quicker Turnaround Time
Getting a cash advance is also quicker than applying for other forms of credit. By submitting your contact and checking account information, you can be approved within minutes. After a quick verification of your information, your lender can wire your cash into your checking account within a few hours. A credit card or personal loan can take weeks to process as lenders check your financial background.
Flexible Hours
By using an online payday loan company, you can apply anytime. Most applications are processed over the internet, so you can get a response even in the middle of the night. And with most lenders, you can contact a representative outside of typical business hours.
Easy Comparisons
Besides the ease of the process, you also can compare lenders much easier than with credit card companies or banks. Most cash advance companies will post their fees or APR on their website in the FAQ section. By checking out several lenders, you can be sure you are getting the lowest fees.
Payday Loan Company – Compare Payday Loan Companies To Get The Lowest RatePayday Loan Company – Compare Payday Loan Companies To Get The Lowest Rate
Payday loan companies vary in the rates they charge customers. You can find low rates by comparing the offers of payday loan companies. The annual percentage rate (APR) is an easy tool to find who has the best deal. You also want to take a look at payment plans to make sure you don’t get taken in by late fees.
Look For The APR
The APR is the cost of the cash advance for a year. Fortunately, the majority of people pay off their payday loan is less than 30 days so they don’t pay such high fees. But by comparing the APR of several lenders, you can find the best deal.
Most often the APR will be listed in the ‘FAQ’ or ‘How It Works’ section of an online payday company. If you can’t find it, simply email the company with a request. By taking a few minutes to compare rates, you can save a few dollars.
Finance Fees
The actual cost of your loan will on average be about $15 for every $100 you borrow. A payday loan company charges the same rate to everyone since there are no credit checks. In the company’s eyes, everyone has the same credit background. The only variable is your income level, which will determine in part how much you can borrow.
Some online payday companies also offer a reduced finance fee for first time borrowers. You will want to make sure they have a competitive rate to begin with, but it is certainly worth checking out.
Payment Plans
One way payday loan companies can get you is by delaying payments. They might just debit the finance charge or a small part of your principal from your checking account. While the small charge may seem nice, you are actually adding on more financing fees for the time delay.