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Welcome to needPaydayLoans.com!
With so many payday site out there, it's tought
to find a payday loan site that suite YOUR NEEDS.
We review tops payday loan site and only recommended top sites!
A payday loan site must be responsive and easy to use. Most companies will offer
a one-time application process for multiple loans. Apply once and request a
loan anytime.
Getting quick cash has never been easier than with needpaydayloans.com. Fast
cash is only a few clicks away; eligibility application is a one time process
and the first step toward getting your cash before payday.
A pay day loan is a short term personal loan that is repaid with a
pre-authorized electronic withdrawal for your checking account on your next
payday.
The Loan Process
Step-by-step process to apply for a loan.
Exploiting Financial Hardship For Profit
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Popular Loan Search Terms
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Critics blame payday lenders for exploiting people's financial hardship for profit. .
Aggressive Collection Practices
A payday lender can only legally use collection industry standard collection practices
What if I have poor credit?
Most payday site will accept applicants who have had past credit problems. The
best way to find out if you are eligible for a pay day loan is to apply.
How long will application approvals take?
For most sites, you can be pre-approved within minutes. Final approvals can
take up to 24 hours. You will be notified by phone or e-mail of your applcation
status.
If approved, how will I receive the money?
To save cost and expediate the loan process, payday loan companies will make a
direct deposit into your bank account.
The Loan Process
Borrowers visit a payday lending store and secure a small cash loan, usually in the range of $100 to $500 with payment in full due at the borrower's next paycheck (usually a two week term). Finance charges on payday loans are typically in the range of $15 to $30 per $100 borrowed, which translates to rates ranging from 390 percent to 780 percent when expressed as an annual percentage rate. The borrower writes a post-dated check to the lender in the full amount of the loan plus interest and fees. On the maturity date, the borrower is expected to return to the store to repay the loan in person. If the borrower doesn't repay the loan in person, the lender may process the check traditionally or through electronic withdrawal from the borrower's checking account.
If the account is short on funds to cover the check, the borrower may now face a bounced check fee from their bank in addition to the costs of the loan, and the loan may incur additional fees and/or an increased interest rate as a result of the failure to pay.
Payday lenders generally do little due diligence to assess a borrower's ability to repay a loan, but many do require the borrower to bring one or more recent pay stubs to prove that they have a steady source of income.
Most payday borrowers are not able to repay their loans loan in full at their first paycheck, and will renew (or "flip") the loan, which is the practice of renewing a loan at maturity by paying additional fees without any principal reduction.
Payday lenders typically operate small stores or franchises, but large financial service providers also offer variations on the payday advance. See below: "Variations on Payday Lending".
Example
For example, a borrower seeking a payday loan may write a post-dated personal check for $460 to borrow $400 for up to 14 days. The payday lender agrees to hold the check until the borrower's next payday. At that time, the borrower has the option to redeem the check by paying $460 in cash, or renew the loan (a.k.a. "flip the loan") by paying off the $460 and then immediately taking an additional loan of $400, in effect extending the loan for another two weeks. If the borrower does not refinance the loan, the lender may deposit the check. In this example, the cost of the initial loan is a $60 finance charge, or 390% percent APR. If the borrower chooses to renew the loan three times, the finance charge would climb to $240 to borrow $400.
Exploiting Financial Hardship For Profit
Critics blame payday lenders for exploiting people's financial hardship for profit. Lenders target the young and the poor, particularly those near military bases and in low-income communities. Borrowers may not understand that the high interest rates are likely to trap them in a "debt-cycle", where they have to repeatedly renew the loan and pay associated fees every two weeks until they can finally save enough to pay off the principal and get out of debt. Critics point out that payday lending unfairly disadvantages the poor, compared to the middle class who pay at most 25% or so on their credit cards.
However, supports argue that some individuals that require the use of payday loans have already exhausted or ruined any other alternatives. They may not be able to obtain a credit card, or rely on secondary sources (such as loans from friends and family members).
Aggressive Collection Practices
A payday lender can only legally use collection industry standard collection practices. These do not include threatening criminal prosecution for writing a bad check. Payday lenders have been known to call a debtors neighbors, or talk with their coworkers regarding overdue loans
Industry Claims Inflate Loan Costs
Defenders of the higher interest rates note that processing costs for payday loans do not differ much from their higher-principal, longer-term counterparts such as home mortgages. They argue that conventional interest rates at these lower dollar amounts and shorter terms would not be profitable. For example, a $100 one-week loan, at a 20% APR (compounded weekly) would generate only 38 cents of interest, which would fail to match loan processing costs.
Critics counter that payday lenders' processing costs are significantly lower than costs for mortgages and other traditional loans. Payday lenders usually look at recent pay-stubs, whereas larger-loan lenders do full credit checks and other due diligence when making a determination about the borrower's ability to pay back the loan.
Lenders Overstate the Industry's Risks
A study by the FDIC Center for Financial Research found that “operating costs lie in the range of advance fees” collected and that, after subtracting fixed operating costs and “unusually high rate of default losses,” payday loans “may not necessarily yield extraordinary profits.” Based on the annual reports of publicly traded payday loan companies, loan losses can average 15% or more of loan revenue. Underwriters of payday loans must also deal with people presenting fraudulent checks as security or making stop payments.
Critics concede that some borrowers may default on the loans, but point to the industry's pace of growth as an indication of its profitability. Consumer advocates condemn the practice as a whole, regardless of its profitability, because it "takes advantage of consumers who are already hard-pressed to pay their debts".
Alternatives to Payday Loans
Many believe that payday loans are the only option for consumers with bad credit, but other options do exist and most financial counselors would direct people to explore the alternatives. Other options are available to most payday loan customers.
Other options include:
- Credit unions - Credit unions in several U.S. states are testing lower-interest loans with more stringent terms.
- Credit payment plans
- Paycheck cash advances from employers
- Overdraft protection
- Cash advances on credit cards
- Emergency community assistance plans
- Small consumer loans
- Direct loans from family or friends
Ignoring the options above, payday lenders make the argument that the interest on a payday loan is less than the costs associated with bounced checks or late credit card payments. For example, bouncing a $100 check may incur an NSF fee from the bank of $28 and a returned check fee of $25 from the merchant. Critics counter that these other kinds of fees are exceptions, whereas the fees on a payday loan are a regular and repeating cost.
Payday lenders present their product's terms alongside a very different list of alternatives and associated fees (costs expressed here as APRs for two-week terms):
- $100 payday advance with $15 fee= 391% APR;
- $100 bounced check with $48 NSF/merchant fees = 1,251% APR;
- $100 credit card balance with $26 late fee = 678% APR;
- $100 utility bill with $50 late/reconnect fees = 1,304% APR.
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