Payday Loans - What You Need to Know > 자유게시판

Payday loans are short-term financial products with high interest rates. These are often offered to borrowers with bad credit and can be used to cover unexpected expenses. However, borrowers should shop around for the best deals and understand their repayment terms.

Unlike conventional loans, payday loans do not require extensive paperwork and usually have lower criteria for approval. This makes them easy to apply for.
Costs
The fees associated with payday loans can be astronomical. In fact, they often come with triple-digit interest rates. They can be so high that a loan of $300 for five months costs the borrower almost $500 in fees.

Obtaining a payday loan is deceptively easy. All that is typically required is a paycheck stub, an ID and a blank check from the borrower’s checking account, which can be cashed by the lender. Most stores that offer these loans also double as pawn shops.

Pew researchers analyzed state regulatory data and advertised products and pricing information from six of the largest payday loan chains to calculate dollar costs and annual percentage rates. (See Figure A.1.)

In addition to payday loans, local credit unions and community banks can provide small loans with more manageable terms. Additionally, credit counselors may be able to offer alternatives that can help people avoid payday loans altogether. A number of non-profit agencies also offer credit counseling at no cost to consumers.
Interest rates
Payday loans come with high interest rates, and this makes them a riskier form of credit. They are often designed to be paid back quickly, usually within a few weeks. The loans don’t require a credit check and can be easy to qualify for. However, the high interest rates and fees can add up to a significant amount of money. The high rates can also lead to a cycle of debt, where the borrower takes out another loan to pay off the first one.

Alternatives to payday loans include personal loans from banks or credit unions, which typically have lower rates. In addition, some lenders offer payday alternative loans with installment terms and reduced fees. Finally, many local charities and churches are willing to lend assistance at no cost. This can be a good option for those who need help paying an emergency bill or consolidating debt. However, it is important to seek advice before taking out a payday loan.
Time to repay
It can be tempting to borrow a payday loan to cover urgent expenses until your next paycheck. But these loans can cost you more than you expect. This is especially true if you’re not able to repay the debt on time.

Payday lenders often charge triple-digit interest rates. They also offer borrowers a short repayment term, typically two weeks or less, which can make it difficult to manage your finances.

Unlike credit card debt, payday loans do not require a full credit check to be approved. However, this can make it hard to get a loan if you have bad credit. They are also often paid off using a continuous payment authority (CPA), which can leave your bank account with insufficient funds if you miss payments.

Fortunately, there are some alternatives to payday loans that can help you avoid the high costs of these short-term loans. Getting a personal loan from your lender or a credit union may be an option, LA or you can consider debt settlement or bankruptcy as ways to get out of payday loan debt.
Alternatives
There are a few options for workers seeking quick cash that are less predatory than payday loans. Some employers offer paycheck advances that allow workers to access funds on-demand, without paying interest. Other options include using flexible payroll or asking for help from a nonprofit organization like Exodus Lending, which offers no-fee payday loan refinance programs.

Credit unions are another source of alternative payday loans. Many CDFI credit unions offer a personal loan product called the Payday Alternative Loan (PAL), which can be used to avoid payday loans or repay existing ones. PALs are available to credit union members, and they usually come with more reasonable terms than payday loans and lower interest rates.

Alternatively, you can ask friends or family for money. While it may not be ideal, it’s better than falling into a debt trap and having to ask for even more money further down the road. And if you do have to ask for money, consider asking the creditor you owe to let you set up a payment plan.