Payday Loans and Issues Payday loans has brought on issues, since state officials, victims of the loans, and many others are standing up, speaking out about the harm the loans can cause. One person spoke out about his experience of payday loans, claiming that after borrowing $300 he had paid back $500 and the figures were still escalating.
Payday loans are unsecured, short-term advances against a paycheck. Rather, the lenders give the borrower in most instances two weeks to repay the loan. Few lenders allot 18 days to repay the advance and its fee. The fees are where the loans pose risk couple with the annual percentage rate (APR).
State laws are out to change the payday loans, with many trying to abolish the advances. At the time we speak, 15 states have now outlawed payday loans. In additional 25 states are currently working to set up strict laws on payday loans.
The loan agreements attached to payday loans tie the borrower into a contract, which states that the borrower has agreed to repay x amount of dollars for exchange of the payday loan amount. The laws stipulate that lenders of cash in any area must provide in writing the loan amount, APR amount, fees applicable and other details to supply loans to consumers.
During the time the loan is issued the borrower will have 2 weeks in general to repay the loan amount and fees applicable to the loan. The loans can lead to bankruptcy or debt unwanted. Many lenders offering payday loans will charge $30 on a $100 payday loan. If the borrower cannot repay the advance on the due date, the borrower agrees to pay the fee and extend the loan until the next paycheck arrives. If you see, payday loans have a pattern and most times the cycle continues.
Overall payday loans are harmful tools that claim to help with bills, shutoffs of utilities, car repairs, grocery, etc. Yet the loans pose a hazard, the loans do not include the damning fees that overdrafts incur.
Yet, the loans are designed for emergencies people will take out the loan for less those critical purposes. The cycle starts. The borrower is now relying on payday loans, almost to the point of addiction, i.e. some do become addicted.
Now we have a serious situation because drugs, cigarettes and other harmful substances and chemicals are not the only additions in the world.
Payday loans on the other hand can lend a hand. If overdrafts are coming in, often overdrafts cost more than fees on payday loans.
To submit an application for an advance you will fill out a questionnaire form, which takes you to an application. At the start, the borrower responds to a few inquiries and if the questions are coordinating to the lenders requirements, the borrower moves to the application process. For the most part, you will fill in the form responding to common questions, such as name, date of birth, etc.
If you intend to apply for a loan online, make sure the site is secured. To website should have a VERISIGN Secured symbol, Lock & Key at the bottom of the page, and/or https:// in the search engine. If the site does not show, signs of security move away from the site area and research the market for payday loans with secure sites.
When consider payday loans check your options and pull out your resources to see if other methods for resolving financial issues are not available. Never take out a payday loan merely to put extra cash in your pocket. If you apply and are accepted for, advances try to save a few dollars, applying the cash toward payback. Always try to pay the loan off on its due date. Some lenders will allow you to repay half the loan and repay the remaining balance on the next two weeks. Do not hesitate to ask if you see you cannot payoff the loan amount on the due date.
Remember payday loans are advances that help in emergencies, and not in situations where emergencies do not apply. Car repairs are emergencies, since we need transportation, and most of us use our car to drive to work.
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