Maybe you overheard that one of your colleagues has spent far too much money during his vacation and reached out to a lender because of the need to pay for his auto loan. Or a contextual advertisement on cheap payday loans online can pop up. This happens when you are looking for information about things related to the banking sector. And maybe you have distributed your income for this month in such a way that you are dead broke at the moment? There is no need to be ashamed of it. Our economy is rich in surprises in recent years1. Unforeseen troubles happen even to the best of us.
You probably already know that this type of loan is usually provided for a not so long period. The amount that you can get in such a way does not exceed a couple of hundred dollars. It becomes clear that a reasonable interest rate plays the lead when choosing a lender. It’s in the nature of things that no one wants to pay too much for being provided with a relatively small amount with not too many days to spare. Of course, everyone would be happy to pay back exactly the amount he had borrowed. But no financial company can exist if its services do not pay off. There is no getting around it. So let’s try to accept this factor and make this deal successful.
Scoring up benefits and drawbacks that can factor into your decision
The variety of types and conditions for this financial services industry is great. There are several characteristics that are typical for the process of obtaining a loan by any person. The list of what is required of each applicant is usually very short. It includes such things as his full real name. Contact details for communication. A bank account, operating by a bank located in the country and able to accept Internet transfers. It is often necessary to have citizenship or to reside in the country for a sufficient time and legally. The rest of the requirements depend on the specific case and lender. However, you can be sure that your financial past will not be assessed too strictly2. So take a little time to evaluate the different offers and the multiple options you can use.
This industry by itself is designed mainly for people who have become undesired clients for banks. Almost anyone can become a client of this type of credit institutions. Surely, it’s a significant advantage. The crucial factor is a stable income sufficient to cover the total amount of the loan. The short time, in which you will have to return the borrowed sum plus the additional payments, can be considered a negative factor. But since you get regular payment, the need to return the money in a couple of weeks should not be surprising to you.
Just do your best to avoid over-exceeding sums of money and troubles will pass you by.
Low interest payday loans – everybody’s tasty morsel
Because of the constantly rising demand, you can be sure that the first lender catching your eye is not the sharpest knife in the drawer. Even if you run low of money you can afford the luxury of a thoughtful choice. The circumstances can make you run at breakneck speed. However, we strongly advise you to devote at least a little time to a thoughtful study of the issue3. Despite the fact that the standard conditions seem identical at first glance it is not true. Cheap payday loans are not often so “cheap”.
The devil is in the details. You should not forget about how important the interest rate is for your deal. Let’s slow down a little and try to enumerate the main points of the matter:
- Your trustworthiness as a customer.
Keep in mind that even if the lender does not want to look behind the scenes of your credit history, he will still evaluate his risk of dealing with an unscrupulous payer. For those who have dozens of late payments and fines under his belt, the percentage will definitely be higher. Also, records indicated loss of the collateralized property or bankruptcy won’t do anything good.
- Any additional fee that increases the amount of the loan.
NB: don’t forget to pay back on time
Such things don’t usually find their place on a picturesque billboard. But even if you do not pay enough attention to them at the beginning no one will rid you of your obligation to pay them. Read the contract to the letter. Sometimes you have to pay extra even for the transfer of the sum to your card.
Even if you are completely sure to come off unscathed read the information about the late payment penalties4. Everyone would be happy to face only pleasant surprises. However, such things arise as thunder from a clear sky. Sadly, no one can predict them. For those who do a poor job of returning the money before the deadline, there is always the possibility of prolonging the loan. Unfortunately, the interest rate increases greatly.
- Give preference to online lenders
It will not take much effort to look for payday loans with low rates online. The reason why many businesses go online is that there’s no rent. Besides, that is possible to hire outsource workers to do a part-time job. By reducing their own spending lenders can afford to offer more profitable loan option thereby increasing their potential customer base. Take advantage of this modern business trend and do not miss an easy opportunity to save a little.
Bringing a cheap short term loan to a sharper focus
People who are eager to find cheap payday loans might dislike the high annual interest rate. No wonder. It can go up to 300-400%5. Of course, it always makes sense to look for an option with a lower APR, it’s black and white. But many lenders are not eager to point exact figures in their offers. Such a long term as a whole year does not apply to short-term loans at all. So it sounds more logical to simply subtract from the total amount for return the amount you are borrowing and estimate the overpayment. It is likely that this simple algebraic action will tell you much more about the profitability of your loan than the frightening huge amount of interest for the year.
Whatsoever, you should not expect the interest to be insignificant. The reason for that is simple. In this loan institution, the quick provision of loans to a wide public segment is always in connection with high risks and costs. Even if you haven’t read about it in newspaper articles you can try to imagine how many people are trying to get their hands on a financial fund with dishonest intentions. Nowadays active competition is present in the financial sector.
The desire to find cash loans with low interest is understandable. But if you consider this situation by any measure… Well, then you realize how unlikely it is that absolutely every client will repay the debt this rate. It will seem quite justified. It is better for someone who is seeking for payday loans with low interest for the first time not to have inflated expectations and be ready to pay for the financial help rendered.
What can we say about cheap payday loans if to put two and two together
It would be absolutely correct if on the basis of our article you conclude that you need to ponder about a lot before making an application. Even though you may have no hope at all… The lender can easily approve your request. But the hardships definitely do not end there. Regardless of whether you are having direct business with the lending organization or use the website aggregating various credit proposals the responsibility for making a decision lies with you.
Reasonable cheap payday loans vary for each individual. So, always look at things from your own point of view not to get into trouble. We would like to give a clear answer whether such loans are a universal way to get out of misfortune for everyone. But such is the world that a mature and clever person understands that any matter has its merits and demerits. Finding the balance is key to success. For this topic of discussion, it is crucial that you overview any smallest detail of your monthly money turnover. Honestly tell yourself whether you are able to cope with the additional credit burden. The success lies in your hands.
- “The global economy is slowing down. What can governments do about it?”. Theguardian.com. Accessed April 1, 2019 from https://www.theguardian.com/business/2019/feb/23/global-economy-slowing-down-what-can-governments-do
- “How To Get A Personal Loan”. Bankrate.com. Accessed April 2, 2019 from https://www.bankrate.com/loans/personal-loans/how-to-get-personal-loan/
- “3 Ways to Choose a Payday Loan Company”. Wikihow.com. Accessed April 4, 2019 from https://www.wikihow.com/Choose-a-Payday-Loan-Company
- “Past Due”. Investopedia.com. Accessed April 6, 2019 from https://www.investopedia.com/terms/p/past-due.asp
- “How to Calculate Annual Percentage Rate”. Thebalance.com. Accessed April 7, 2019 from https://www.thebalance.com/annual-percentage-rate-apr-315533