Home - Mortgage Loans | Personal Loans | Bad Debt Loans | Foreclosure Loans
Apply for a Loan | Best Auto Loans | Best Bad Credit Auto Loans | Best Bad Credit Loans | Best Bill Consolidation Loans | Best Cash Advance Loans | Best Credit Cards | Best Credit Repair Tips | Best Debt Consolidation Loans | Best Free Credit Reporting Tips | Best Home Equity Loans | Best Mortgage Loans | Best Pay Day Loans | Best Personal Loans | Best Products on the Internet | Best Unsecured Loans
Great Financial Advice
Apply for a Loan
Latest Financial News
Rate Lock Advisory
Best Products
Join Our Mailing List
Contact Us
Loan Articles Index
Auto Loans
Bad Credit Auto Loans
Bad Credit Loans
Bill Consolidation Loans
Cash Advance Loans
Credit Cards
Credit Repair Tips
Debt Consolidation Loans
Debt Reduction Loans
Foreclosure Loans
Free Credit Reporting Tips
High Risk Loans
Home Equity Loans
Home Loans
Lawsuit Loans
Mortgage Loans
Pay Day Loans
Personal Loans
Products on the Internet
Real Estate Services
UK loans
Unsecured Loans
Loan Article Index
Loan Articles A-G
Loan Articles H-Q
Loan Articles R-Z
Mortgage Calculators
Mortgage Calculator
Mortgage Amortization Calculator
Rent vs. Buy Calculator
How Much Can I Afford Calculator
Auto Payment Calculator
Click here to Sign up for Email and Newsletter

 

redhotloantips fat loss


Receiving a Bad Rap: Payday Lenders Get All the Criticism While Bank Loans Get Off Scot-Free

Written by: Joseph Spalding

Receiving a Bad Rap: Payday Lenders Get All the Criticism While Bank Loans Get Off Scot-Free

Payday lenders loan money to individuals at interest rates determined by the amount and length of the loan. If a payment due date needs to be extended, then the borrower is charged additional fees. Traditional banking institutions and credit unions do the very same thing-not to mention, they selectively deny service to large segments of the population. So why are payday lenders the only ones getting so much bad press?

Payday Loans May Not Be That Expensive, After All

Across the United States, payday lenders average a $20 charge for every $100 loaned. While this may sound high at first, consider the alternatives offered by a bank. Nationally, the average insufficient check fee (when the bank clears a check even when there isn't enough money in the account, making the account balance negative)

Fees are tacked on to payday loans if they can't be paid back in time; typically, loans renew every two weeks. In contrast, if a bank account is negative for 30 days, most banks will close the account and send the account holder to a collections agency for the negative balance. Most people would welcome higher fees if the alternative was losing their checking account and having a collections charge placed on their credit report--a mark that could end up costing thousands later on in higher interest rates due to a lower credit score, compared with perhaps $100 in extra loan fees.

Many payday lenders offer additional services, like check cashing and money orders, similar to banks. Even on these counts, payday lenders can often be easier to deal with and more affordable.

Payday Lenders Serve a Larger Audience

If the explosion of payday lending services on the scene means anything, it's that they're filling a need that has long gone unrecognized (or been outright ignored) by banks. While lending money is a primary source of profits in the banking world, they usually are not interested in small or short-term loans; they prefer to focus on mortgages, auto loans, student loans, and the like. Additionally, banks are rarely willing to do business with people who don't have good credit.

Payday lenders, on the other hand, recognize that everyone hits upon hard times, and most only require some proof of employment--no credit checks--in order to provide an immediate loan. Yes, it's true that payday lenders largely serve a poorer segment of the population, but that's only because the banks have been turning those same people away.

The biggest indication that payday lenders may not be that bad are the significant number of people who continue to flock to their doors. Consumers now have more choices, and they have made it clear that the $200-billion-a-year payday lending industry is becoming an attractive alternative to many banking institutions for some needs.

About the author:

carcasherdotcom seocontest when you're looking for a car loan.


Other Related Articles:

No Income Verification Home Equity Loan
A no income verification home equity loan is a second mortgage loan that does not require you to provide income documentation to qualify for the loan. This type of loan is great for homeowners who need a home equity loan but have hard to...read more

Low Interest Payday Loan - How To Figure Out The Apr Of A Payday Loan
The annual percentage rate (APR) of a payday loan is a helpful tool to compare rates of lenders. According to the "Truth in Lending Act," passed by Congress, payday companies are to provide you with the APR. Some companies list this...read more

3 Important Things To Consider Before Taking Out A Personal Loan
Personal loans are a simple and easy way to borrow usually between 1000 and 25000 and can be a good way to finance the purchase of a car, holiday, home improvement or anything else that requires an up front lump sum payment. The main...read more


Return to Home

468x60

Best Auto Loans, Best Bad Credit Auto Loans, Best Bad Credit Loans, Best Bill Consolidation Loans, Best Cash Advance Loans, Best Credit Cards, Best Credit Repair Tips, Best Debt Consolidation Loans, Best Debt Reduction Loans, Best Foreclosure Loans, Best Free Credit Reporting Tips, Best High Risk Loans, Best Home Equity Loans, Best Home Loans, Best Lawsuit Loans, Best Mortgage Loans, Best Pay Day Loans, Best Personal Loans, Best Products on the Internet, Best Real Estate Services, Best UK loans, Best Unsecured Loans
Subscribe to Mailing List | Private Policy | Unsubscribe | Site Map