Cash Advance Payday Loans

Cash Advance Payday Loans

Finance is one very delicate subject – especially when it’s about the paying rent, buying a house or buying a boat for example. You need money but you don’t have it! That is why people invented payday loans, which can be very helpful. On your following payday, the business cashes the check you have written and your loan is paid in full. This seems like a great idea – helping people get to their next paycheck by lending them a few dollars in the meantime. What is the problem? The problem is that few people realize just how expensive it can be to borrow money in this manner. The interest rates offered by the payday lenders can be very high, so be aware!

The interest rates that payday loan stores are permitted to charge can be different in different states, but a typical rate for a two-week loan would be 15-17%. That doesn’t seem like much if you are borrowing $100 and writing a check for $115; but the annual interest rate on such a loan is actually 390%, which makes it perhaps the most expensive way to borrow money. The joke in the industry is that it would actually be cheaper to borrow from a loan shark than from one of these legitimate businesses.

The lenders defend these rates, pointing out that such costs are necessary to protect their business overhead and high default rate. That may be true, but many borrowers are blue collar workers who live from paycheck to paycheck. It is easy to fall into the trap of repeatedly using such loans, and the interest adds up in a hurry, turning a convenience into a nightmare. Someone who is short this week may also be short in two weeks, and a loan of a few hundred dollars can quickly turn into a debt of a few thousand dollars, especially when late fees and bounced check fees are added to the total. More than a few borrowers at such businesses have had to resort to personal bankruptcy in order to get out from under their mountain of payday loan debt.

 

Even more egregious is the fact that such loan stores are frequently located near military bases. Our military personnel aren’t well paid and several members of Congress are not pleased that these predatory businesses are setting up shop for the purpose of exploiting our men and women in uniform. Several states have already passed laws that place limits on the interest rates that such businesses may charge and others will undoubtedly follow. A better alternative for anyone with a short term cash shortage would be to take out a credit card loan or a home equity line of credit instead. There is usually a small fee associated with such a loan, but the interest rates, which are probably no more than 30%, are far more reasonable than the 400% per year charged by the payday lender.

Anyone considering a payday loan should read the terms of the agreement carefully. Otherwise, that short term loan could haunt you for years.

 

 

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Facts That Everybody Should Know About Wonga

Facts That Everybody Should Know About Wonga

With everybody on the planet coming to terms with the difficulties that we need to deal with unexpected expenses spring up and traditional lenders ignoring our needs and circumstances most of the time, where should we turn to at our time of need? Look no further as your quest is finally over. Wonga Group Limited has quite a few services that can assist in times of sudden financial need. Their main tool of providing relief is payday loans.

This British payday loan company was established 10 years ago and with its revolutionary high-tech payday lending model has broadened the scope of credit unions. Here are some quick facts that you should know about this sophisticated and automated loan company that is scoring and soaring behind the scenes.

  • Payday Loans SecuredThose who opt for Wonga Payday Loans are required to give only 8 pieces of personal information and its online algorithm will provide them with 1,800 data points based on calculations in just 2 seconds. This will determine eligibility for the loan instantly.
  • Most of the traditional lenders out there don’t look at Wonga Payday Loans as a sign of good credit history. This may or may not be attributed to professional jealousy; however, the point remains as to why this is so even if such loans were paid on time.
  • For those who are new to Wonga Payday Loans, know that the key to Wonga’s credit scoring model is the speed at which it automatically sorts through relevant online information, compromising of 8,000 data points.
  • Wonga Payday Loans are so speedy that after the credit scoring process has been done, customers are promised their amount in a blindingly fast 6 minutes, with most of them having the money wired to their accounts in 15 minutes. Still unbeatable on the planet.
  • With Wonga Payday Loans high in controversy, who would have not guessed that their interest rates are eye-watering and relatively have much higher APRs than many other payday lenders?

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  • Before you apply for Wonga Payday Loans, you should know that MP Stella Creasy is already running a campaign where she wants the government to reconsider her proposal to put a cap on the cost of payday loans.
  • Seeing an advertisement for Wonga Payday Loans can be rare as the ASA (Advertising Standards Authority) has already banned one of its ads to come on air as of April, 2014.
  • The OFT (Office of Fair Trading) and FCA (Financial Conduct Authority) have been hot on trail for Wonga’s mismanagement and unfair practices as of 2014 investigations.
  • Wonga is UK’s biggest payday lender, and one of the few companies that advertise their loans.

Wonga and other payday lenders are often labeled as loan sharks preying on customers, and encouraging the buy-now-pay-later culture in the youth, which is curbing the need to have saving habits.

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