Unless you’re a total shut-in, I’m sure you’ve heard of payday loans by now. Payday lenders are everywhere; on the high street, in the banners of your browser and before your YouTube videos. If you’ve hit hard times, and your credit rating isn’t too great, then you might be interested in one of these services. There are a few things you should know beforehand though.

So, what is a payday loan? The clue’s in the name! Payday loans are loans, made to a lender or creditor, intended to see a person through to their next payday. Typically, they have a fixed fee, which represents the finance charge to the borrower. Due to their short terms, the cost of borrowing through a payday lender is usually very high compared to the alternatives. Before the loan is approved, the borrower will have to give some kind of insurance. This is usually in the form of debit authorisation, or a pre-dated cheque made out to the lender.

The process of payday loans is fairly straightforward. Let’s say you had some kind of repair which couldn’t wait, and wanted to borrow £300. After a chat with the payday lender, you’ll write them a pre-dated cheque for £340. This is just an example of the amount plus a finance fee. These vary from lender to lender. Then, the lender will advance you that £300 for a pre-determined period. With most lenders, this will be around 14 days. Then, when the period is up, they’ll deposit the pre-dated cheque for £340, or you can pay up using a different method. If you fail to pay on time, you’ll run headlong into the main downside of payday loans. An additional fee will be added to your bill, and these will continue to pile up the longer you take to pay.

So, is it for you? Payday loans can be a good option for people who don’t have access to credit cards or savings. Most payday lenders don’t require a credit check as part of the lending process. Consequently, it’s seen as a good way out for people having credit issues or who have no credit score at all. This has made it fairly popular for military employees, and recent immigrants. They’re an effective, quick fix for financial crises, when you don’t have any other recourse available. As you’ve probably heard though, there are downsides to payday loans. It’s essential that the borrower can pay back the loan within the given period. If you’re not able to meet the date you’re given, then additional fees can rack up alarmingly fast. If you get stuck in the cycle of payday loans, you could end up facing all kinds of larger financial problems. Once you’re in, it can be extremely hard to get out! The average annual percentage rate of a payday loan is about 400%. However, they’ve been known to get much higher!

If you know you can pay up on time, then payday loans may be a good option for you. However, you’ll probably have much more stable options available.

Difference Between Cash Advances and Payday Loans

If you need to borrow money fast, you have probably ran across multiple financial institutions offering cash advances and payday loans. But what are the difference between them and which one is best for your situation? Aren’t they the same thing?

Read more about the differences between the two to help you determine whether cash advance or payday loans are the right choice for your needs.

Types of Cash Advances

The words “cash advance” are often used synonymously with the words “payday loan” when referring to obtaining an advance on your paycheck. This type is usually structured in a similar way as an online personal or payday loan, in that you can only borrow a certain amount based on your income. These types of cash advances are meant to be repaid when you receive your next payday. These short-term loan is usually required to be repaid within a month.

The second type of cash advance is actually based on a line of credit or credit card. It is based on a credit card or available credit limit, and not on your monthly income amount. Cash advancement on your credit card is treated like a purchase you made on the card and the repayment terms are typically the same as if you made a purchase.

Payday Loans

Often called payday advances, payday loans are a form unsecured loans that require no collateral and typically not credit check. These types of loans are obtained based on your income and meant to be repaid on your next pay date. However, the repayment schedule of these loans is often flexible and can be repaid in multiple payments.

Most online payday loans do, however, require you to have a bank account where the money borrowed can be transferred. This bank account will also be where your repayment is deducted from electronically on the predetermined due date. Payday loans obtained from a storefront usually require you to write a post-dated check that the financial institution will deposit or cash on your next pay date. However, the actual term of your loan will vary depending on the company you are working with.

The amount of money you can borrow with a payday loan depends on the amount of income you make. These limits usually range from $100 to $1000. People with a much higher income may be able to borrow higher amounts. This will all depend on the financial institution you are dealing with.

Checklist: Things To Check Off Before Getting Payday Loans

Payday loans are sometimes a necessity. When an emergency arises and your budget needs a fast cash injection, payday loans can be a simple, quick way to accomplish that goal. But these loans aren’t something you should take on without some thought. You still need to consider a few important points before you take the leap.

Seven Pre-Loan Considerations

1. How will you pay the loan off?

Many people inadvertently get into a cycle of needing payday loans every pay period because they don’t come up with a good enough plan for paying their first one off. Remember that to pay back the loan, you’re going to need enough extra money to pay off both the loan principal and the interest. To get this, you may need to cut back on your spending. This can be difficult but it’s worth it to avoid wasting money on interest week after week. Cut out any social plans you have, scale back on your groceries, and find other ways to pad your budget.

2. Is the interest reasonable?

 Because payday lenders take on large amounts of risk, they charge a higher interest rate than many other lenders. While you may be okay with being charged the higher rate, you still need to compare rates of all the lenders in your area and make sure that you aren’t getting too bad a deal.

3. Know the laws and your rights.

Payday loans are only permitted in certain states and many of those states have limits on the interest you can be charged. You should be familiar with these limits and any other regulations, such as those covering the interest that payday lenders are permitted to charge those enlisted in the military.

4. Consider alternative sources.

If you need money so fast that you’re considering a payday loan, that could indicate that you aren’t in a financial position to manage the stiff interest rates charged on these loans. If this is the case, consider trying to find other means of getting the money, such as borrowing it from a friend, getting an advance from your employer, using a lower-interest credit card or pawning something you don’t need.

5. Think about how much you need.

Don’t borrow as much as you can, borrow as much as you need. This will make the loan less expensive, since it reduces the principal that the interest is charged against, and it makes it much easier to pay off.

6. Borrow only in emergencies.

Make sure the reason you get the loan is worthy of taking on this kind of risk and expense. Using a payday loan to get your car fixed so you can go to and from work makes sense, getting one so you have some extra cash to buy a birthday present does not.

7. Change your budget for the better.

The fact that you needed a payday loan indicates that you may need to adjust your budget and put more money into an emergency savings each month. If you do, the next emergency won’t require an expensive loan–and won’t that be a huge relief?

Northcash payday loans can be a useful tool in getting you out of a temporary financial hole. Just make sure that you understand your rights and that you have a plan to pay off the loan and avoid needing even more of them in the future.

When to Use Short Term Payday Loans

Short term payday loans have been around for years. These virtually instant financial solutions have entered the households of many consumers over the years. If you are currently having financial difficulty, you may be wondering if you should venture into the realm of the quick cash advance. You can arrive at a sound decision by asking yourself several questions pertaining to your current financial situation. Neither lender nor friend can tell you if you are suitable for a payday loan. Only you know if you can handle this advance. The following three questions will help you decide.

What is my Disposable Income?

Before you take any loan product, you should calculate your disposable income. Disposable income is the money you have left over after you pay your household bills. To arrive at this figure, add all of your monthly sources of income and subtract the collective amount of your bills from that. Your monthly income may include child support and government benefits if they are reliable sources. Your bills should include every bill that you have to pay on a monthly basis. The amount that you have left after you perform this calculation is your disposable income. If it is equal or greater than the amount of the payday advance you desire, then you are in an excellent position to take one.

Is There any Other way to get the Cash?

Before taking short term payday loans, you should see if you could get the funds from another source. Perhaps family and friends can loan you the money. Maybe your employer offers cash advances. Additionally, you might be able to sell something from your home that you no longer use. Exhaust all possibilities before completing an application for a payday loan.

Can I Delay the Emergency?

Because of their high interest and short repayment terms, payday advances are best for emergencies. Before making an application, see if you can take care of your situation later when you have the money. For example, if you are considering taking a payday loan to purchase an electronic product that you do not necessarily need today, you should wait until you can save up the funds.

Short term payday loans are not poor products. In fact, they can be lifesavers for people in the right financial position. Just make sure that you can pay back the proceeds comfortably without putting undue stress on yourself.

Save Yourself From Loan Sharks – Know How To Settle Payday Loans

Dearness is increasing day by day. People are facing the same old financial problems for a long time. Prices of all things are increasing but the earning of general people is limited or not growing as per their expenses. It has created trouble for low income people and whose salary is very low. The reason people are attracted towards USA Payday Loans is because of instant loan approval facility and no credit checking option. But the main problem is that it is a short terms loan therefore the interest rate and APR of this loan is high compared to other loans and general loans. These short terms loans comes with APR 400% to 700%. This is the main reason most of the loan borrower face lot of difficulty while repaying the loan amount.

It is also true that many borrowers get trapped in the vicious cycle of payday debt because of high interest rate and failed to repay the original amount plus the interest rate at the on the due date. Some people take multiple loans at the same time, but they are unable to manage their loans. If you are one of them who has taken multiple loans then it is good news for you that now you can consolidate your loans into one monthly payment. Payday Loans Consolidation is best option for those people who has taken multiple loans at the same time.

Know how To Consolidate Payday loans?

There are few important steps that one should know in order to consolidate multiple loans and this way they will easily pay just a single amount and it will automatically get start paying all their different Loans.

Step 1

First of all you need to tell lender that you are stopping all payments. Do it by writing a letter to lender and mention you are unable to pay. This step will send your account to a collection agency. After this, they will try to collect money which you have taken

Step 2

It is highly advised to research and collect all available information about your state laws regarding Payday Loans. If your payday loans lenders have broken any rule then you will have an easier occasion resolving your account. If it is possible then call your state regulator and tell them about lender is not complying the law

Step 3

It is advised to utilize credit card with no yearly cost and a zero percent initial rate to pay off the loans

Step 4

Try to obtain personal unsecured loan from a lending institution as it is the better option

Step 5

Notify collection agency that you want to Payday Loans Settlement. Although collection agencies will try to take you in the court but do not panic because most of the collection agencies do not want to get involved in court matter and provide you option to negotiate for Payday Loans. Therefore, it is advisable to give hint to the collection agency that you are willing to negotiate. In case they refuse then must contact bankruptcy attorney for help.

In case your collection organization does not agree to a lump addition settlement amount then think accepting a resolution concerning a payment plan. This option will provide you easiest way to repay the money which you have taken.  It is also advised to consult with debt settlement program for Payday Loans Consolidation.  After trying all things, if you are unsuccessful at negotiating a settlement then look for debt settlement programs in your area means private debt settlement companies and if it is possible then contact with nonprofits organization such as Goodwill Industries.

If you are interested to read latest news and articles on Payday Loans then visit USA Payday Loans.