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By: Nasrullah Mardani

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Thursday, 24-Feb-2011 11:57 Email | Share | | Bookmark
Pay Day Loan - Easy and fast respectful transaction

Pay day loan are a valid id, proof of employment and a post dated check, and are typically extended for a period of between one to four weeks. Pay day loan companies require that the check be written out for the amount you want to borrow, plus a fee amount for processing the loan. If the loan is not repaid in full within that time frame, stiff penalties are usually imposed in the form of much higher than average interest rates. You borrow $100 with the understanding that you will repay the loan by your next pay day (in two weeks). The pay day loan company charges you $20 in interest upfront. When your pay day arrives, you find that you are still short on cash and cannot repay your loan in full. You request an extension on your loan, and are granted one, but are assessed an additional interest rate charge. At this point, you will have to repay a total of $140. When expressed as annual percentage rates over a two-week period:. With a $20 interest fee added is 520% apr. If an extension is requested and a late fee of $25 is applied on top of the loan and interest amount is 1170% apr. you must be employed (for at least a month. you must have a checking account that your loan can be directly deposited into. * you must be a us citizen or legal alien.

Pay day loan are on a fixed budget and are already living paycheck-to-paycheck and cannot afford to pay the entire loan back out of their next check. Pay day lenders expect this and usually offer the borrower a chance to roll the loan over for another two weeks until the next payday, for a fee of course. The cycle of rollovers can quickly build up, especially if individuals found borrowing from several different pay day lenders, and can lead to an endless cycle of debt. When someone is living from paycheck-to paycheck, a pay day loan may force them into. Or even require them to seek good. The fees and interest rates on pay day loan can be astronomical. It is common to see interest rates between 300% - 1500%. Compare this to typical interest rates on cash advances on a credit card, usually between 20% - 35%. Lenders are required to provide individuals with a full disclosure of the apr on the loan and must also offer a written loan agreement.


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