Cash Advance Loans Payday Loans

Cash Advance Loans & Payday Loans
$100 OR MORE .​
The ads are on​ the​ radio,​ television,​ the​ Internet,​ even in​ the​ mail .​
They refer to​ cash advance loans or​ a​ payday loan - which come at​ a​ very high price .​
Check cashers,​ finance companies and others are making small,​ short-term,​ high-rate loans that go by a​ variety of​ names: payday loans,​ cash advance loans,​ check advance loans,​ post-dated check loans or​ deferred deposit check loans .​
Usually,​ a​ borrower writes a​ personal check payable to​ the​ lender for the​ amount he or​ she wishes to​ borrow plus a​ fee .​
The company gives the​ borrower the​ amount of​ the​ check minus the​ fee .​
Fees charged for cash advance loans or​ a​ payday loan are usually a​ percentage of​ the​ face value of​ the​ check or​ a​ fee charged per amount borrowed - say,​ for every $50 or​ $100 loaned .​
If you​ extend or​ roll-over the​ loan - say for another two weeks - you​ will pay the​ fees for each extension .​
Under the​ Truth in​ Lending Act,​ the​ cost of​ payday loans - like other types of​ credit - must be disclosed .​
Among other information,​ you​ must receive,​ in​ writing,​ the​ finance charge (a dollar amount) and the​ annual percentage rate or​ APR (the cost of​ credit on​ a​ yearly basis) .​
Loans secured by a​ personal check - such as​ a​ payday loan - is​ very expensive credit .​
Let's say you​ write a​ personal check for $115 to​ borrow $100 for up to​ 14 days .​
The check casher or​ payday lender agrees to​ hold the​ check until your next payday .​
At that time,​ depending on​ the​ particular plan,​ the​ lender deposits the​ check,​ you​ redeem the​ check by paying the​ $115 in​ cash,​ or​ you​ roll-over the​ check by paying a​ fee to​ extend the​ loan for another two weeks .​
In this example,​ the​ cost of​ the​ initial loan is​ a​ $15 finance charge and 391 percent APR .​
If you​ roll-over the​ loan three times,​ the​ finance charge would climb to​ $60 to​ borrow $100.Where to​ Complain If you​ think your lender has violated the​ law,​ you​ may wish to​ contact the​ lender or​ loan servicer to​ register your concerns.

You Might Also Like:

Powered by Blogger.