Payday Loans 101

Created: 2019-05-08 09:00:00

There are a couple of things you need to know before you dive right in to the world of payday loans, some basics and tips and tricks that will better help you navigate this nontraditional form of lending.

For starters, it’s important to understand that payday loans look like a short-term financial fix but in reality almost always anything but. These loans on average stretch out over six months (according to industry research), and with an average APR that can sit above 300% you need to know EXACTLY what you’re getting into before you sign on the dotted line.

Secondly, you absolutely must be sure that you’re moving forward with a 100% legitimate and trusted company. There are a lot of predatory operations in this nontraditional lending business. While they might not outright cross the line into unethical business practices, they are definitely going to stack the deck in their favor and have you pay a lot more in interest – and in fees – then you would have expected at first.

Move forward with legitimate operations only and you will have nothing to worry about.

Finally – and maybe most critically – it’s essential that you always take advantage of payday loan solutions with the best intentions in mind and never asked for any extra money than what you absolutely need. According to industry research, 70% of those that take out payday loans use the money on nonessential purchases rather than financial emergencies and find out later that day are on the hook for more money paid back in interest than what they borrowed in the first place.

Stick to the inside info we shared above and you have nothing to worry about when you proceed with payday loans. Deviate from the details we broke down and you might find yourself in a bit of a pickle.

Warning: Late repayments can cause you serious money problems. For help, go to moneyadviceservice.org.uk