7 things to look out for when searching for the best payday loans
Unexpected expenses can pop up when you least expect them. With no savings to help bridge the gap, you may be forced to turn to payday loans to tide yourself over the emergency. You may also need short-term loans to help supplement you cash flows until your paycheck arrives, and these loans could offer the much-needed relief.
Figuring out how to get the right lender is the first step towards getting the best payday loans that suits your needs. To get the best rates in the market, it’s important to know what to look for in a lender.
Rules that’ll help you get the best payday loans in your area
It’s easy to get confused and fall for scam lenders when looking for a loan. Below are some of the things to look out for in your search:
Is the payday lender authorized to operate in your state? In areas like Massachusetts and Florida, this mode of lending is illegal. Therefore, ensure that you are dealing with a licensed lender who adheres to the borrowing regulations of your state. In your search, you can check with the attorney general’s office or the Better Business Bureau to be sure that you are dealing with a legit company.
Do they have a physical office?
Most payday lenders operate online. This is no surety that all of them are legitimate. According to a survey by a private statistic firm in Houston Texas, around 30 – 40% of lending companies are either scammers or overcharge vulnerable borrowers.
If you suspect any shady dealings, check out their website and verify if they have offices in other states. If they operate strictly online, chances are high that you may be scammed. Just remember that not all online lenders are illegitimate, and it’s important to be cautious.
Take your time, and do thorough research
Don’t ever be in a hurry when looking for a loan. Some of the worst financial decisions are those made in a rush. When shopping for the best payday loans, it’s important to compare several lenders before deciding who to work with. Check out their customer reviews, interest rates, willingness to share all the loan details, and how supportive they are to help you gain your financial balance.
Weigh all the advantages and disadvantages of each lender and chooser a lending company with the most affordable and flexible terms.
When dealing with an online lender, you’ll share your details when filling out the loan application forms. Some scrupulous lenders will share or sell your information to third parties who will continually pester you with sales pitches.
Ensure that the lender you intend to use has secure data encryption to protect third-party invasion.
Although there are restrictions on how much lenders can charge as interest on payday loans, some predatory lenders still overcharge borrowers. Compare the different rates each lender in your list is offering and settle for the most affordable.
Remember that high interest will make your loan expensive in the long run. Payday loans have very short repayment periods and any interest above the norm will make it more expensive and difficult to pay back.
The terms and conditions
Terms and conditions vary from lender to lender. Apart from interest rates, there are terms on repayment schedules, penalties on late payments, and loan rollover charges to look out for.
Some lenders have flexible terms on late payments and could extend your loan term to suit your needs. Ensure that you choose a lender who offers the most flexible terms depending on your current financial status
Adherence to borrowing laws of your state
In trying to market their products and services, lenders will entice you into believing that they are the best in the market. This is usually to lead you on, and then once you take out their loans, they come up with ridiculous terms.
Every state has payday regulations in place to protect vulnerable borrowers from unscrupulous lenders. Check out from previous customers’ reviews and get insight on past dealings by the lender you intend to use. Don’t fall prey to predatory lenders who are after your money.
Benefits of using payday loans
For borrowers struggling with bad credit, getting a loan from banks can be a daunting task. Several payday lenders, however, don’t gauge your eligibility for funding based on your credit history. In most cases, they don’t carry out credit checks and don’t care about your credit scores.
They offer some of the best payday loans to bad credit borrowers, and make it easy for them to sort out their emergencies hassle free.
Below are some of the benefits of using a cash advance:
Quick and readily available
Some emergencies like medical bills, a car breakdown or a leaking roof can’t wait for your payday. A payday loan will tide you over such situations and give you the much-needed relief.
Most lenders have simplified their loan application and approval process, and it’s possible to receive your funds on the same business day. All you need is to show proof of a source of income, be at least 18 years old, and have an active bank account and contact details.
No credit checks
Lenders will not perform credit checks, or if they perform soft checks, they will not use your bad credit report to gauge your eligibility for a loan. A lender will use your income to base your capacity to pay back the loan and give you a loan amount they are sure you can comfortably pay back.
You don’t have to put up your property as security to get a loan. Your post-dated check if enough security that you will pay back. Be cautious of payday lenders who ask for security in exchange for higher loan amounts.
A savior during emergencies
Unexpected expenses can put you in a tight spot. With no savings to fall back to and no family or friends willing to lend you money, you can go insane.
Payday loans offer quick relief during such time, and help you get by until your paycheck arrives.
Alternatives to payday loans
Despite the promising benefits, the harsh reality is that payday loans are notoriously expensive. The high-interest rates and APRs are way above your normal loans.
Before applying for an instant cash advance, explore other means of funding. You will be surprised at how much you can save by using other short-term financial services.
Below are some options worth exploring:
- Installment loans – these are loan products that are paid back in small amounts over an extended period. Depending on your agreement with the borrower, the loan can be spread out over 18 months with equal installments that allow you the flexibility and freedom to pay back the loan without incurring more costs. Unlike a cash advance, you don’t need to pay a single lump sum to pay off your loan.
- Low-interest personal loans from traditional banks – this will require that you work on your credit score first before getting funding, but it’s worth it. Low-interest personal loans could save you from a debt trap.
Being a responsible borrower could save you from incurring more expenses that you could avoid if only you acted wisely.
Below are some of the things you need to do:
- No matter how difficult it is, have some savings set aside. It could help you avoid payday loans altogether.
- If you have to borrow, make sure you are able to pay back on time to avoid penalties that could make your loan more expensive.
- Ensure you read and understand the terms and conditions of the loan before signing any loan agreement form.
At Plaza investments, we ensure that we match you to experienced direct lenders who will not only lend you the best payday loans in the market; they’ll also work with you to get your financial balance. Apply today, and let us match you with the best payday lenders.