According to research by watchdog Consumer Focus, the number of people under a payday loan has quadrupled in the last 4 years.
The consumer group said 1.2 million people are now in the process a payday loan every year - more than 1 billion pounds borrowing.
Payday loans are becoming increasingly popular and are seen as attractive - especially for those who find it difficult to have to fund.
However, it is recommended that this type of loan is best reserved as a product of last resort, as loan interest rates may not be compared to high street competitive prices are offered.
If the money paid back immediately to the next payday, this type of loan can be cheaper than paying an unauthorized overdraft or a credit card.
However, if the loans are rolled over, the debt can rise quickly strong.
Loan fees for this type of loan, on average, between £ 13 and £ 18 for every 100 pounds of interest on loan, but they can rise or high as 30 pounds per 100 pounds sterling for some online vendors.
Some companies, however, the interest charges of more than 2,500% per year, and, as a result, the watchdog is pressing the industry to bring more protection to vulnerable borrowers.
Sarah Brooks, Head of Financial Services, Consumer Focus, said: "Payday loans are a valid form of loan and it is much better for people to take one to go instead to a loanshark.
"But we think it must take a limit to the number of loans people and how many loans they will be able to roll," she said.
Showing posts with label Payday Loan. Show all posts
Showing posts with label Payday Loan. Show all posts
Saturday, September 11, 2010
Thursday, September 2, 2010
Payday Loans As Last Options
Shared an article about payday loans on the internet and I read all of this article may be articles.and you can make in your comments.
US economy is improving and many experts claim that US is out of recession but they are mainly looking at numbers at the Wall Street not the Main Street. Cash flow remains to be a major issues with the Americans. Lack of jobs, or lack of good paying jobs has many them under financial constraints forcing them living paycheck to paycheck.
But even having a paycheck is not enough anymore. Due to the inflation, caused by poor economic recovery, paychecks are not keeping up with today's expenses and as the results Americans are looking to borrow money from their credits cards, and other alternative short term loans.
Among all these alternative loans, payday loans, seem to be the most popular type of loans. They are the fastest type of loans and they are the less risky of all loans. There are often no credit checks. As the name payday implies, customers jobs and their steady paychecks are enough to qualify for a loan.
The amount of the loan depends on a few factors such as borrower's income, bank balance, and their existing payment history for the lender. For example if borrower's first time from a lender, chances are that borrower will not be qualified for the full amount he or she applied for. For example if borrower applies for a $500 loan, he or she will probably qualify for half of asked amount, in this case is $250. The if he or she makes the payment on time, that will establish a good relationship with the lender so next time he or she can ask for a higher amount if needed.
Payday loans can be obtained either by going to a local paycheck advance store or by going on-line. There are many websites offering payday loans but the payday lenders that are trusted stand out by offering a full service including live support. They are the ones that educated their customers on how payday loans work, and help them with payment plans.
US economy is improving and many experts claim that US is out of recession but they are mainly looking at numbers at the Wall Street not the Main Street. Cash flow remains to be a major issues with the Americans. Lack of jobs, or lack of good paying jobs has many them under financial constraints forcing them living paycheck to paycheck.
But even having a paycheck is not enough anymore. Due to the inflation, caused by poor economic recovery, paychecks are not keeping up with today's expenses and as the results Americans are looking to borrow money from their credits cards, and other alternative short term loans.
Among all these alternative loans, payday loans, seem to be the most popular type of loans. They are the fastest type of loans and they are the less risky of all loans. There are often no credit checks. As the name payday implies, customers jobs and their steady paychecks are enough to qualify for a loan.
The amount of the loan depends on a few factors such as borrower's income, bank balance, and their existing payment history for the lender. For example if borrower's first time from a lender, chances are that borrower will not be qualified for the full amount he or she applied for. For example if borrower applies for a $500 loan, he or she will probably qualify for half of asked amount, in this case is $250. The if he or she makes the payment on time, that will establish a good relationship with the lender so next time he or she can ask for a higher amount if needed.
Payday loans can be obtained either by going to a local paycheck advance store or by going on-line. There are many websites offering payday loans but the payday lenders that are trusted stand out by offering a full service including live support. They are the ones that educated their customers on how payday loans work, and help them with payment plans.
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