At times, accidents or injuries can increase your bills unexpectedly. You may not be able to pay these bills and have no other way to get money. However, payday loans are expensive and must be paid back on time. You must get all pertinent information before accepting an offer from a payday loan company.
If you find yourself stuck with a payday loan that you cannot pay off, call the loan company, and lodge a complaint. Most people have legitimate complaints, about the high fees charged to extend payday loans for another pay period. Most loan companies will give you a discount on your loan fees or interest, but you don’t get if you don’t ask — so be sure to ask!
Consider how much you honestly need the money that you are considering borrowing. If it is something that could wait until you have the money to buy, put it off. You will likely find that payday loans are not an affordable option to buy a big TV for a football game. Limit your borrowing through these lenders to emergency situations.
If you are in the military, you have some added protections not offered to regular borrowers. Federal law mandates that, the interest rate for payday loans cannot exceed 36% annually. This is still pretty steep, but it does cap the fees. You should check for other assistance first, though, if you are in the military. There are a number of military aid societies willing to offer assistance to military personnel.
Keep in mind that you have certain rights when you use a payday loan service. If you feel that you have been treated unfairly by the loan company in any way, you can file a complaint with your state agency. This is in order to force them to abide by any rules, or conditions they fail to live up to. Always read your contract carefully. So that you know what their responsibilities are, as well as your own.
Do not allow a lender to talk you into using a new loan to pay off the balance of your previous debt. You will get stuck paying the fees on not just the first loan, but the second as well. They can quickly talk you into doing this time and time again until you pay them more than five times what you had initially borrowed in just fees.
Don’t overlook the future costs of getting a payday loan. You can never assume that it is okay to skip a payment without severe penalties. The truth is much uglier, most borrowers who take out a payday loan usually pay the lender about 200% of what they took out. This is important to remember when budgeting.
Check the BBB standing of payday loan companies. There are some reputable companies out there, but there are some others that are less than reputable. By researching their standing with the Better Business Bureau, you are giving yourself confidence that you are dealing with one of the honourable ones out there.
Those looking to take out a payday loan would be wise to take advantage of the competitive market that exists between lenders. There are so many different lenders out there that some will try to give you better deals in order to attract more business. Make it a point to seek these offers out.
Payday loans usually carry very high interest rates, and should only be used for emergencies. Although the interest rates are high, these loans can be a lifesaver, if you find yourself in a bind. These loans are especially beneficial when a car breaks down, or an appliance tears up.
Be sure to step back and give yourself a “cooling off” period for at least ten minutes before you sign off on a payday loan. Sometimes you have no other options, and having to request payday loans is typically a reaction to an unplanned event. Make sure that the emotional shock of the unforeseen event has worn off before you make any financial decisions.
While you should not routinely accept payday loans, they do serve a valuable purpose during times of financial emergency. You should not have any issues if you are smart about it. Use everything you’ve learned here when considering a payday loan.