Archive for the ‘Loan’ Category

postheadericon What are payday loans?

A payday loan is a sort of short-term borrowing in which a lender extends high-interest credit depending on your ability to pay back the loan quickly. You will normally get a portion of your next paycheck as principal. Payday loans, which provide short-term, urgent credit, are charged exorbitant interest rates. Cash advance loans and check advance loans are other names for these loans. To know more, visit https://financeguider.com/payday-loans.

Payday Loans: What You Should Know

Payday loans offer high rates of interest and do not require any form of security, making them a type of unsecured personal loan, according to the Federal Reserve. These loans may be called predatory lending since they carry exceptionally high-interest interest rates, do not take into account a borrower’s ability to repay, and contain hidden provisions that charge borrowers added fees.

As a result, they have the potential to trap consumers in a debt cycle. If you’re thinking about taking out a payday loan, you might want to examine other, more secure personal loan options first.

Are payday loans fixed or variable?

Payday loans are often intended to be repaid in a single lump-sum payment when you receive your next paycheck. It is as a result of this that the interest rate on these loans is guaranteed. Even in the absence of an interest rate, many payday lenders impose a fixed flat fee that can range anywhere from $10 to $30 per $100 borrowed, rather than charging an interest rate.

Is it possible to get a payday loan with no collateral?

The vast majority of payday loans are unsecured. This means that, unlike in a pawn shop, you will not be required to provide collateral or borrow against a valued object in order to obtain credit. Instead, the lender will most likely ask for your permission to electronically withdraw funds from your bank, credit union, or prepaid card account, which you would often grant. Alternatively, the lender may ask you to write a check in the amount of the loan repayment, which the lender will cash when the loan payback is due. According to federal law, lenders cannot refuse to make a payday loan unless they first receive the consumer’s authorization for “pre authorized” (recurring) electronic financial transfers before making the loan.

 Conclusion

The vast majority of payday loans are unsecured and do not require any form of security. These loans may be called predatory lending since they carry exceptionally high-interest interest rates, do not take into account a borrower’s ability to repay, and contain hidden provisions that charge added fees.

postheadericon Ways personal loans can save you money

While it is a good financial habit to set aside an emergency fund to cover unforeseen expenses, it is not always sufficient to cover all of your needs. It is possible that you will incur huge expenses for which you will not be able to pay from your bank account at any time. When dealing with these types of unforeseen bills, taking out a personal loan is generally a better option than utilising high-interest credit cards. SKM Credit, which is good at money lending in Toa Payoh Singapore, can get you personal loans at reasonable rates.  Here are five ways that a personal loan might enable you to save money:

Enhanced Credit score

Missing loan payments has a negative influence on your credit score and makes you appear as a high-risk borrower. The good news is that by making timely payments of your personal loan EMIs, you will ultimately enhance your credit score, making it easier for you to obtain loan approvals at lower interest rates in the future.The higher your credit score, the more likely it is that you will save money on interest rates in the future when you take out further loans.

Lower interest rates

Interest rates on personal loans are lower than those levied on the majority of credit cards, as previously mentioned in this article. Because of this, personal loans can be utilised to make purchases instead of credit cards in order to save money.

Consolidation of debts.

It is possible to obtain a substantial, low-interest personal loan to pay off your other high-interest loans with a single application. It is possible to save money on your high-interest student loan or credit card bill, for example, by repaying them more quickly or all at once with a personal loan,

Intelligent repayment strategies

You should utilise the most appropriate repayment plan based on your present and projected financial situation in order to increase your savings before taking out a personal loan. The step-up repayment option is available to those who anticipate their financial circumstances improving in the near future.

Conclusion

Because of the development in internet lending, the good news is that you may apply for and receive cash from a personal loan in as little as a couple of days. It is not acceptable to use a personal loan as an excuse to incur additional debt. An alternative is that a personal loan can be a useful instrument for a clever borrower who has a plan in place to get out of debt and start down the road to financial independence.

postheadericon What to do if you can’t pay back your payday loan

You quit your part-time job but still need to pay the rent. Your car breaks down suddenly and you need a little extra help. Sometimes, you need a little cash to get by. So you get a Payday Plus $300 loan and make good on your bills. But what happens when you can’t repay a payday loan? Here’s what to do if cannot pay back your payday loan on time:

1. Check your liabilities

Go over all your liabilities, from your payday loan to overdue bills. Focus on the ones that have the highest interest rates. With high rates, the longer you take to clear the debt, the more money you’ll end up paying.

2. Extend your repayment plan

Ask your lender for an extended payment plan. You have to ask for an extension before the last day your loan is due, though. You’ll also sign an amendment to your loan agreement. Read it over and make sure you understand the new terms and interest rates you’re agreeing to. You might be able to get a few extra weeks to repay your loan.

3. Consider a personal loan

Don’t be afraid of big banks, at least not when it comes to personal loans.

Taking out a personal loan can help you pay off your debt. These loans have much lower interest rates and longer repayment terms than payday loans. If you have poor credit, you’ll be happy to learn that you can even find personal loans for credit scores under 550.

4. Try a credit union

Credit unions and payday loan lenders have a lot in common. You usually can find one near you offering small installment loans that can help you make important payments.

While you have to be a credit union member for at least a month, you can get anywhere from $200 to $1,000 with terms from one to six months. The interest rate on a PAL is much less than the interest rate on a payday loan, up to 28%.

5. Get help

When you’re in a tough situation, it’s always a good idea to get help, whether it’s credit counseling or a cosigner for a loan. Asking for assistance is a big step in getting on the right track.

Conclusion

You might consider a payday loan, but you don’t need it. When you can’t repay a payday loan, there are plenty of alternatives for you to consider. If you’ve already gotten one, take caution and know your rights. Explore ways to pay it back as soon as possible so you’re not trapped in debt.