Cash Advance Loans Payday Loans
Below is a MRR and PLR article in category Finance -> subcategory Loans.
Understanding Cash Advance and Payday Loans
Quick Cash Until Payday
"GET CASH UNTIL PAYDAY! $100 OR MORE, FAST." You might have heard these ads on the radio, seen them on TV, or come across them online. They all promote cash advance or payday loans?"options that can be costly.
What Are These Loans?
Cash advance loans, also known as payday loans, are short-term, high-interest loans offered by check cashers, finance companies, and other lenders. These loans go by various names, such as check advance loans, post-dated check loans, or deferred deposit check loans.
Typically, you write a personal check to the lender for the amount you want to borrow, plus a fee. The lender then gives you cash for the amount of the check minus the fee. These fees are usually a percentage of the loan or a flat fee per amount borrowed, often charged for every $50 or $100 loaned. If you choose to extend or "roll-over" the loan, additional fees will apply for each extension.
Disclosure Requirements
Under the Truth in Lending Act, payday loans must disclose costs in a clear manner. You should receive written information about the finance charge (the cost in dollars) and the annual percentage rate (APR), which reflects the yearly cost of the credit.
For instance, if you write a check for $115 to borrow $100 for up to 14 days, the lender holds the check until your next payday. At that time, you either allow the lender to deposit the check, pay $115 in cash to redeem it, or pay a fee to roll over the loan for another two weeks.
Cost Example
In the example above, the initial loan costs a $15 finance charge with an APR of 391%. Rolling over the loan three times would increase the finance charge to $60 for a $100 loan.
What to Do If You Have Complaints
If you believe your lender has violated the law, consider contacting them directly to address your concerns.
You can find the original non-AI version of this article here: Cash Advance Loans Payday Loans.
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