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Need Some Extra Cash Fast? Here’s Everything You Need to Know About Getting a Payday Loan

This news story was published on April 17, 2019.
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With more than 10 million people applying for them every year, payday loans are increasing in popularity. While they’re not the best option for everyone, they’re one of the many great ways to get extra cash fast. When you need a payday loan, you’ll find that it’s one of the easiest ways to get the money you need as fast as you need it.

Here is everything you need about getting a payday loan or getting cash fast.

How Payday Loans Work

If you’re strapped for cash between now and payday, one of the most common ways to get the money for consumers now is through short-term loans. The most standard type is termed as “payday loans” and they fall into a specific category where lenders can get money for a short-term until payday essentially.

You can either visit a payday lending office or fill out an application online. If you’re in a bind, some lenders the online option can get the money in your account faster. All you need to submit is a paystub and bank account information.

The loans can be for as little as $50 to $1,000, depending on local laws. If you’re approved, you can leave the office with the money ready to use. However, you’ll have to pay back the money on your next payday, so you need to be smart about it.

You can save yourself the trouble by giving them a post-dated check to ensure that you repay on time. Failure to repay could result in severe interest charges. APR goes anywhere from 300% to 500% of what you’ve borrowed.

Some lenders get underwater quickly on these loans, but if you’re careful about your spending or you make sure to leave a post-dated check, you should be fine.

Understand the Risks

If you fail to repay your loan by the deadline, you could be in for more than you bargained for. Make sure that you’re responsible for this type of loan because even if you can’t pay, you have options to deploy before you run overdue. Some loans allow for a “rollover” which means that you pay some and start building interest.

Rollovers can turn into avalanches quickly. Before you end up buried, you’ll need to take action on even a rollover loan.

In just a month, a loan for about $300 could end up costing you $500 in the end. The reason so many lenders offer payday loans is because they can make a fair amount from them. The convenience that is offered to loan holders can come at a steep price.

Before you sign on to anything, make sure you read the fine print.

Laws Are Changing So Stay Aware

While many states are introducing laws regulating the payday lending industry, not every state is worried about regulating these loans. There are some states where you could end up owing thousands of dollars for lending $100 or less. Federal law requires that every lender discloses the dollar amount of how much you’re being charged in finance fees and how much you get in APR.

Some states are now using an affordability test to ensure that there aren’t as many rollovers on these loans. They also limit the number of times that a checking account can be debited to ensure that you don’t lose too much or incur overdraft fees because of your loan.

Payday lending is big for members of the military. This is because of how challenging the pay schedule is for people in the military and how little they get paid at the start. Thankfully the Military Lending Act keeps lenders from charging more than 36% interest.

Getting a loan when you need one might become harder in the near future. The practice was completely wiped out in New Jersey and in Washington, you have a set number of times you can take one out. This can be double-edged for consumers seeking loans as a healthy means to get out of debt.

Know Your Alternatives

Most people who are seeking out a payday loan aren’t taking one out for some weekend fun or to blow at the casino. People often take them out to pay off other debts, bills, mortgages, or the rent on their apartment. However, many of the people who you owe money to are more flexible than you think.

When you’re trying to pay off a utility bill, you can call the company that you owe and ask about your options. When you fall behind, there are hardship programs to help you get onto a payment program. You might even be able to take a month or two off from paying with a low-income assistance program.

If you need an extension on your rent, ask if you can pay less for a month and then make it up in the future. Rather than having to search for a new tenant, your landlord might be flexible.

If you have a credit card, you might want to start using that. Even though your APR could be high, it will cost you less than paying a payday loan. Don’t overspend on your credit card but if this can help you keep your head above water, it’s worth it in the end.

If you only have a debit card and still need a payday loan, visit Bonsai Finance to learn more about getting a loan under those terms.

Still Need a Payday Loan?

Even if you have a substantial debt to deal with, you might still need a payday loan to get by. A payday loan can ensure that you keep your head above water while you figure out how to deal with the other financial issues you’re facing.

If you want to get better at investing and saving your money, check out our guide for some tips.



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