How do cash advance companies work?
Mary asked:
I need a little extra cash quickly. How do these companies work? Are there extreme interest rates or something? Any information from people who have used these companies would really be appreciated. Thanks!!
excuse me. i do have a job, but unfortunately i am a 19 year old whose family does not help her out and i need to pay for everything myself, and i need a little extra help before i get paid.
thanks every one else
try going to get job
Wherever you go, read the fine print BEFORE you sign anything.
In Canada here, there are laws against how much interest they can charge you, but the insta-loan people found a way around that. I've seen them requiring you to write them a dated cheque to repay them on a certain date at the time you get the loan. While the interest they charge is relatively low (on the short term) there is a hefty "fee" for accepting the cheque that they require you to write.
Anyway, in that instance, I read the fine print of my friend's payday loan. It said if the loan was repaid before the due date, the repayment cheque would be returned, avoiding the fees associated with it. Thing is, who really reads these contracts? That's how they make their money! Anyway, the debt was repaid in person a couple days early, the cheque was returned, and instead of nearly $50 I think the final tab was less than $10.
Oh yes, you need to have a job and verifiable income. They give advances on your next paycheck, not money for those who can't repay it.
For the period of time you have the money, the interest rate is going to be higher than a cash advance on a credit card (since you would be more of an unknown risk). From what I hear it could be equivalent to a 3 figure APR, and those figures are to the left of any decimal point. So you really have to be desperate (or foolish).
You would need to have employment and a recent paycheck stub. You may also need to bring a utility bill or something else that has your name on it. They also require a state ID or drivers license as well as a bank statement and check book. You cannot just bring in a check to write out for the payday loan.
Yes, they charge upwards of 600% interest. Most payday loans are for 30 days max, but most want you to pay the loan back on your next payday. So, if you get paid every 2 weeks, they would want their money in 2 weeks unless you can convince them to let you go the 30 days.
The problem with a payday loan is it becomes a vicious cycle for some that is hard to escape, as you can never pay off the loan itself plus the huge interest they charge. Most people just renew the loan or keep rewriting the loan over and over. Some get in so far over their head that they have to go to another payday lender to borrow in order to pay the first lender off! LOL As you can see, this is a slippery slope and if you are on the verge of being destitute, you want to do everything in your power to avoid this type of loan.
hi
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Well first of all you have to know how much is coming in and how much you would have to pay back after the loan, including the interest of course.
Most cash advances are are not a good idea because the people getting them are really dumb sometimes and cannot pay the money back which leads to worst things. SO if you have the money they yea go ahead and get the cash advance if you are in dire need of it.