Getting a payday loan is pretty cut and dry: apply online or in-store, give the lender information about your job, monthly income and bank account, get approved and have your money in the bank the next business day. In unique cases, it may take a little longer but over all, it’s the fastest and most convenient way to get cash in a hurry.
Payday loan rates and fees are determined by the lender. The state the borrower lives in determines the max amount a lender can loan as well as the how much interest can be charged; this is to protect the consumer from “predatory” lending. Rates typically stay the same regardless of changes in the economy or stock market.
Some lenders may offer a coupon for discounted fees or a promotion with an incentive to refer a friend but for the most part, payday loan lenders don’t carry special offers like so many credit card companies do. Why? Because they are in the business of short-term lending that is considered “high risk”. Meaning, they take risks loaning money to people who have bad, little or no credit at all while expecting it to be paid back right away with the borrower’s next paycheck. Without the option to make money with long-term annual interest rates (APR), a payday loan lender makes their money by charging fees and interest rates for lending on a short-term basis.
Credit cards, on the other hand, are well known for enticing consumers with special offers. Getting cash back or acquiring airline miles is always a plus when you are already paying money to spend money (unless of course you pay your bill off each month to avoid interest charges). Credit card companies can be a little sneaky, though, when trying to reel you in. Educating yourself on the wiles of these plastic money methods can help you make the best choice when it comes to choosing which offer is best for you and your pocket book. Consider the following when taking the credit card plunge:
* Pre-Approved – Getting a pre-approved offer for a credit card seems so easy, right? The easy part was getting the letter in mail.The difficult part may be actually getting the card. Credit card companies will tell say you are approved on the initial mailing but you will still need to go through the application process and have your credit history checked which will be the determining factor to whether or not you get approved.
* Unbelievable rates – Credit cards, auto dealerships, recreational vehicles and the like always advertise low rates. That’s how they get people to shop and apply for their products. Unfortunately, those rates are only for customers with ideal credit. If that’s not you, chances are you will be disappointed to find that you got a much higher rate than the one advertised.
* Special offers – What’s better than getting cash back, airline miles, or bonus points for taking out a credit card and using it to make purchases? Not much if you are planning a trip to the islands or want to use that rebate for a new TV. Sadly, many of the special offers given have stipulations that can only be found in the fine print. If you are looking for cash back, there may be a limit on how much you can earn. With airlines miles, you may be expected to spend a certain dollar amount within a specific time period or else you will not be eligible for your miles.
Payday loan lenders may not entice you with special offers but it’s always important, as with any credit card offers, that you read the fine print before you apply. Do some research on lender websites to make sure you understand the terms of the loan you are taking out and remember, if it seems to good to be true – it probably is!