By: Tess Taylor
Are you considering a payday loan, but are afraid of some of the myths you’ve heard? If you are in need of a payroll cash advance and have encountered some of these myths, you can rest assured. There are a lot of misconceptions about the payday advance process, including how they work, the fees associated with them and what is required to get a payday loan. Here are some of the top payday loan myths and why they are false.
Myth: You need a good credit rating to get a payday loan.
The beauty of payday loans is that you do not need a perfect, good or even a fair credit rating to get a payday advance. In fact, your credit isn’t even checked during the application process. What you do need, however, is proper identification, a steady income, and a checking account. In addition, some payday lenders ask for copies of utility bills to determine if you pay your bills on time. Getting a payday loan is easy and takes just a few minutes and does not affect your credit rating at all.
Myth: There are huge fees charged with payday loans.
Payday loans charge generally a $15 fee for every $100 borrowed. This amount is dependent upon how much you decide to borrow and how quickly you pay it back. Many payday lenders offer a discount on this fee for early payback. If you are concerned with the fees associated with payday loans, consider what it would cost you to take a cash advance against your credit card with interest penalties? The fees charged by payday lenders are nominal as compared to the late fees charged by banks and credit card companies.
Myth: Payday loans trap consumers into a cycle of never ending debt.
When is comes to payday advance loans, many people think that it’s ok to take out additional loans to pay of earlier ones. This practice is frowned upon by payday lenders. Payday loans are designed to be a resource for consumers who have exhausted other options to take out small loans to manage unexpected emergencies or income shortages. They are not intended for regular long-term use. Consumers in serious debt should consider other methods of resolving this such as consolidation or consumer debt counseling.
Myth: Payday loans are targeted at households that have low incomes.
There is no real basis for this myth. Payday loans are available to all individuals regardless of income and are provided as a resource to help with life’s unexpected bills and responsibilities. There is no evidence to support the theory that payday lenders prey on low income residents or that they are more likely to take out these forms of loans. Payday lenders are not in the practice of predatory lending; rather they seek to help all consumers in times of need that not may not have other options available to them for short term financial assistance.
Myth: People get tricked into Payday loans and then can’t pay them off.
There is no “trickery” involved in the payday advance process. Potential customers are provided with written information and in-person support to assist them with the application process. Customer service representatives explain everything thoroughly and customers have the opportunity to ask any questions they may have in advance. If a customer experiences difficulties in paying back the loan, there are often additional options or time presented to them to pay the loan back in a reasonable amount of time.
Check out our Payday Loan News section for all your information on payday loans at Payday Cash Advance Loans.
