Tuesday 15 May 2012

Need Advice About Payday Loans? Keep Reading

By Lorraine R. Haralson


Do you think you will need some extra cash before you get paid? Have you thought about getting a payday loan, but don't know where to start? This article can help give you the information you need to figure out if a payday loan is the right choice for you.

Pay the loan off in full by its due date. Extending the loan will only result in a "snowball effect", compounding the interest fees and making it harder to pay back on the next due date.

You must be sure to have the money in your account on the day that your payday loan comes due. Most lenders require that your loan payment is drafted from your bank account. If you don't have the money in your account on time, you can be faced with high interest charges that put you further into debt.

Watch out for companies that automatically roll over the finance charge to the following pay period. The problem is that borrowers tend to just continue paying such charges and the loan never gets fully repaid. Payday loans have often to cost people 500% the amount of the original amount borrowed.

Before you settle on a payday loan, explore any and all other options available to you. Find out if you can get money from the your local bank, family or friends. If you can borrow elsewhere, a payday loan is not in your best interest. You should only get a payday loan if you have no other choice.

You should always look into other ways of getting funds. To avoid high interest rates, try to borrow only the amount needed or borrow from a friend or family member to save yourself interest. The fees associated with these choices are usually a lot less than using a payday loan.

If you plan to rely on payday loans in order to get by, you need to consider taking a debt counseling class in order to manage your money better. These loans are for emergencies only and extremely expensive, so you are not managing your money properly if you get them regularly.

Learn everything you can about all fees and interest rates before you agree to a payday loan. Read the contract! Most everyone knows there are high interest rates associated with payday loans. Avoid getting hit with late charges by making sure you only borrow the amount you can pay back within the time limit. Usually, these fees are hard to find in an agreement.

Always closely guard your financial information when applying for loans. You will be required to give the lender personal information during the application process. Always be sure that the company you use is legitimate and well-known.

Now you are ready to decide if a payday loan will help you out of this situation. Make sure you spend enough time to determine if a payday loan should be taken out. Just remember to use what you gained from this article so you can make the right decisions, and so that you are not left clueless in the future.




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