With interest rates often above 200%, PayDay loans, also referred to as Cash Advances, are one of the most expensive types of loans on the market today. Although they offer short-term Solutions to financial distress. They may have the ability to get you to the next payday. Cash advances, and Cash Advance can be dangerous to your financial well-being. If the interest is so high, and they can be such a bad idea, why are they still a viable solution?
If you have ever been in a financial bind, Expert Payday Loans may seem like the only way to get through the month. If you have an unexpected expense, need a home repair, or a crucial bill, the ability to obtain quick cash can be very helpful.
Much of the time a checking account is required to obtain a payday loan. The payments are quite often upwards of 200% and can more than triple the original loan amount because the interest is so high. it can be easy to end up increasing your expenses and causing a cycle to be created that can be very hard to get out of.
Because interest rates on cash advance loans is so high, jurisdiction has created federal regulations to prevent Usery. These laws keep interest rates from going into unreasonable and excessive amounts that are often charged by Cash Advance institutions. In the past it was not unheard of for the interest rates to be between 360%-400%. To give an example, and help you picture the way it works, let’s say you borrowed $300, you could end up repaying over $1000, if you were to miss a payment.
This is why regulations have been put into place, to avoid this unfair lending practice, which is still legal in some form or another in most states.
Even with Payday Loans being such a frightening commodity, consumers still sometimes need the cash to get to their next payday. If there is an unexpected bill, or expense and they don’t have anything in their savings account, a cash advance may seem like the only option.
When you apply for the loan, the lending institution allows you to borrow against future earnings by analyzing your previous pay stubs. It is usually a small loan amount, often less than $500, but the repayment of the loan may not end up being so small.
To see if you qualify for a Cash Advance, you can look up a cash advance institution online or visit one in person. As long as you are of age, have a phone number, a job and proof of income you will most likely be able to get that much needed extra cash.
Once given the loan, you will be giving the lender the ability to withdraw payments from your checking or savings account on the days that you set up for repayment. Even if these payments are made on time, the lender will often charge a fee of $15 to $30 to withdraw the funds.