ALL YOU NEED TO KNOW ABOUT CASH ADVANCE PAYDAY LOANS
Cash advance payday loans are short term loans of a small amount that can be used to get out of tight financial situations. Even though sometimes payday loans may be the only alternative you have in hand, you should take the final decision after considering the risk and costs involved with cash advance payday loans. This guide is aimed at giving you an understanding about how payday loans work so that you can take an informed decision before taking one.
WHAT ARE CASH ADVANCE PAYDAY LOANS?
Payday loans Las Vegas (www.paydaylv.com) are loans that you seek as a temporary solution to handle financial requirements that you are not prepared to handle. These loans should be treated as a cash advance to the pay of your next month since ideally these loans are to be returned on your next payday. You either give the lender a postdated check of the due amount that the lender can cash in on the due date or provide the lender with the authority to trigger an electronic transfer for a specific amount on a specific date. In case you find yourself incapable of paying the loan back on the due date, you can ask the lender for a rollover. This gives you an extension on the loan period and the interest or additional fee accumulate for the extended period. Payday loans may also be marketed as No credit check loans, fast loans or cash advance loans.
COSTS INVOLVED WITH CASH ADVANCE PAYDAY LOANS
Generally, payday loans are expensive because of the conveniences they offer. Payday loans are disbursed almost immediately and there are no credit checks involved, because of which the risk involved with such a loan is higher for the lender and hence they charge higher interest rates and fee. Most lenders offer loans at an annual percentage rate of several hundreds, sometimes even as high as 350%. The state agencies put restrictions on the fee that lenders can charge from borrowers in order to prevent harassment of borrowers.
PITFALLS OF PAYDAY LOANS
The biggest disadvantage of payday loans is the cost involved. In many cases, due to the high fee being charged, they do not solve the real problem. It is true that cash advance payday loans can be used to help you get out of rough patches but in case you have a long pending poor financial situation, payday loans would make things only worse. You should only consider taking payday loans if you have a short term financial problem and you have full confidence that you would recover when your next paycheck arrives. If you are not able to pay the loan back on time and keep stretching the loan for a few months, you may end up paying more interest than the actual amount you borrowed.
ALTERNATIVES TO CASH ADVANCE PAYDAY LOANS
Payday loans can prove to be extremely costly and risky. Before you decide to take out a payday loan, you should consider other available options and keep the loan as your last resort. Like all loans, you should always act very responsibly while taking a payday loans as the costs involved can make things more difficult for you.
THERE ARE SEVERAL THINGS YOU CAN DO IN ORDER TO AVOID TAKING OUT A PAYDAY LOAN:
- As a practice, it is always suggested that you should have a month’s salary in your savings account to handle emergency expenses. You should always try to build this emergency fund by being proactive and saving even if you don’t see a trouble in near sight. Build a monthly budget in such a way that you can save some money every month.
- You should keep a credit card handy. If you are eligible for one, a credit card can be very helpful in dealing with emergency expenses. Credit cards can be better than payday loans for various reasons like there is always a no interest period, between you spending the money and the due date to make the payment. You most likely would get the next paycheck during this period and can avoid paying the interest charges. Additionally, you can spend whenever emergency strikes, you would not even have to wait for approvals to come in.
- In case you feel you are in a difficult financial spot, you should consider taking another part time job in order to get some breathing room.
- Try borrowing from friends or relatives