In the perfect circumstances, here is how a payday cash loan would be described. You walk into a high street financial agency that offers payday cash loans. You would then request for a specific amount of money (generally the amount that is on your next paycheck or less). The agency then gives you the money, no questions asked (regardless of your credit history), as long as you agree to their terms. Free money! Right?
Not exactly friend!
While the payday cash loan can be a glorious thing to those who are in over-their-heads in debt and have nowhere else to turn, there are certain things for sure to keep in mind before you apply for a loan to get rid of financial exigency from these payday loan or cash advance loan agencies.
First off, you should never borrow more than what will be on your next paycheck. The point of these loans is to help you through debt. If you borrow more than you can quickly pay off, you will just be adding one more type of weekly debt to the pile, so it is best to play it smart. Therefore, do not borrow anything over what you will be making or earning in the following days. Actually, it is probably the best to borrow even less than what is on your next paycheck, because. . .
the interest rates on payday loans are just crazy! It is not uncommon to have to agree to over 20% worth of an interest in order to borrow the money, no questions asked. So what? So to keep the payday cash loans advantageous, manipulate the percentages to ensure that the amount borrowed and interest do not exceed your next paycheck. For example, instead of borrowing the full $200 on your next paycheck, if the interest is say, 25%, borrow rather $160 and not $200. This way, you can pay off the full $200 within the week you borrowed it, rather than beginning the unenviable task of recovering from even more debt.
There are other things to consider, but sticking by these rules will help you to wisely borrow money.
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