In tough economic times, an instant cash advance loan is a practical resource albeit an expensive one. Families or individuals in need of cash to pay bills or to literally survive until the next paycheck are more & more leaning towards this type of assistance. An instant cash advance loan, or payday loan, are now substantially more popular than ever.
Borrowers, however, are all too frequently so intent on getting the money they need, they don’t always check or fully understand the terms and conditions of accepting this type of loan.
Never, ever walk out with a check unless you completely understand your obligation!
First time borrowers are sometimes shocked when they fully realize what they are getting themselves into, but they feel they have no choice. For example, if you want to borrow $400 from your next check you could figure that all you need to do is simply go back the following week with the $400 and maybe a few bucks in interest.
… Wrong!
Some online lenders seem proud when they talk about their normally low rates as they advertise that new clients applying for an instant cash advance loan automatically qualify for a 50% discount. The more often you go back for loans, the better your discounts are (on the interest you must repay).
Of course, a 50% discount looks mighty attractive to someone who is worried about interest payments, but you need to really find the small print to see that the 50% discount still amounts to hefty payments. With some, a $300 loan works out at 912% interest per annum.
Yep… 912%!!!
And that’s only if you are able to repay the entire amount within their 14 day period. If you’re late – forget it.
Move to Siberia.
A 14 day $300 loan at these rates will cost you $52. 50 in interest! So, in 14 days you need to come up with $352. 50. A new customer would get his 50% discount off the interest and “only” pay $21.25.
Still outrageous for a short term loan.
Remember that these are unsecured loans. No, they are not secured by your paycheck as one might think. They are personal loans, and any lender who loans pure cash for any reason with no collateral is going to hit you where it hurts, just in case you default. They can’t touch your paychecks but you certainly pay for the privilege of being able to borrow money.
Before deciding on an instant cash advance loan, make certain this is indeed your only option…. and don’t fall behind on payments whatever you do. Getting behind on these can bring you to absolute financial ruin.