Unfortunately, theyre also almost always a bad deal for you. Payday loans are typically small, usually 500 or less, and made for a short period of just a week or two before repayment is required on your next payday. Theyre easy to get as long as you provide proof of income. The lender usually requires you to write a check for the loan amount plus interest that can be used for repayment.
You may even give the payday lender electronic access to your account. The main problem with payday loans is the astronomical finance charges. According to the Consumer Financial Protection Bureau (CFPB), you may pay 10 to 30 to borrow 100. If you pay 15 to borrow 100 for two can payday loan hurt my credit, thats an APR of a whopping 400.
Some lenders may give you another 30 days if you cannot pay on time. To avoid defaulting on a loan, see if a relative or good friend can help with the payments. This allows you additional time to pay your friend back without worrying can payday loan hurt my credit losing your car or incurring extra interest fees.
If you cant pay back the loan, or wont be able to, you may have to look at selling the vehicle or other items you own free and clear. Longer loans: Some lenders will give borrowers a longer time to repay their title loan. Often, these repayments are structured as interest-only payments. Pay period: Payday loans are only for one pay period. You will set up this timetable with your lender, and they will cash your check after you get your next paycheck.
Maybe take a step back even further and consider a more long term perspective. How can you get yourself in the position to pursue a degree, go to a trade school or start your own business. To spend less money seems pretty straightforward, but harder in practice. However, you can create big savings with small changes. These small daily changes can be hard at first, but they soon become a habit and will snowball once you start seeing progress.
The financial return is exponential. Consider this: if you have savings in place, this will protect you against the need from having to take a paycheck advance, creating even more savings. Payday loans are great when you are in a pinch, but you want to be set up to avoid them as much as possible. The last thing you want is to get stuck in a payday loan debt cycle that puts you in a position to continually take out can payday loan hurt my credit cash advances to cover the expense of your original lending agreement.