You wouldn't consider
buying a new pair of shoes, a bicycle helmet, or an extra pair of jeans without
trying them on first to make certain they fit. After all, a pair of shoes that
is two sizes too small will never fit and they amount to money wasted. Shopping
for anything - products or services - is pretty much the same. The smart
consumer does some research, tries a few on for size and makes sure that the
purchase ultimately meets his or her needs in a variety of ways.
Finding the right
payday loan to fit your needs is essential. You don't want to end up paying $50
in loan fees for something you could have gotten for $20 from another lender.
And, just as shoes come in all sizes, shapes and colors, there are numerous
variables associated with payday loans - items like the amount of time you have
to pay back the full amount, the loan fees that are involved, and whether or
not the lender will allow you to roll the loan over if you can't pay it back on
time and how much that will cost.
Repayment Times - When
you are searching for a payday loan, you need to examine how long the lender
allows for the loan to be repaid. Time is a major factor to consider. For
example, you just had a major car breakdown and it will cost $500 to fix it.
You just got paid last week and don't get paid again for another 25 days. You
have already paid all of your regular bills and have just enough money left to
feed your family for the rest of the month until payday rolls around again. You
know that you could pay to have the car fixed on your next payday, because you
have fewer standing obligations to meet with that check, but in the meantime,
you have to get the car repaired immediately so you can get back and forth to
work. There are dozens of payday lenders to choose from, but about half of them
only loan money for 14 days maximum. That doesn't do you much good, since your
payday is 25 days away. Therefore, you need to consider only those payday
lenders who can make loan arrangements extending out 30 days. That gives you
time to get your paycheck and pay back the loan on or before the due date.
Loan Cost - A survey
of Internet payday loan websites reveals that the average loan cost is $25 per
$100 borrowed. At this rate, an individual borrowing $500 would actually pay
the lender $625 (the amount loaned, plus loan costs) at the end of the loan
period. There are a few sites that advertise loan costs as low as $10 per $100
borrowed, in which case the total cost for borrowing $500 would be $550.
However, some lenders disguise their actual fees by quoting a rate per $100 and
tacking on an additional fee as well. For example, a fee of $25 per hundred,
with a $10 additional fee, actually amounts to $35 per $100 borrowed, for a
total cost of $675 for a $500 loan. Borrowers should carefully examine the
stated loan costs and any fine print that identifies additional fees carefully
before entering into a loan agreement with a lender. Be aware that, if your
bank account does not contain sufficient funds when the lender attempts to
withdraw the amount you agreed to pay, the lender can also charge bounced check
fees, which range from $15 to $30. The good news is that increasing numbers of
lenders doing business on the web has resulted in some very competitive payday
loan terms being available. But, remember to shop around and find a good fit.
Borrowed Amount - The
amount that you can borrow from an individual lender is also a factor that
needs to come into play in your decision regarding which loan to take. Some
lenders loan up to $1,000, $1,200, or even $1,500, depending on the size of
your monthly income. Others may only lend up to $500 and, in fact, the average
size loan made from Internet payday lenders is $500. How much you apply for
should relate directly to how much you absolutely need and how much you can
afford to pay back without having to roll the loan over and incur additional
loan fees.
No comments:
Post a Comment