Checklist for Payday Loan Borrowers

When times get tough, most consumers think about getting a payday loan to get through. In many US States, payday loans are legal so you can find legitimate lending companies that offer quick cash advances for those in need. But before you do, here are some questions you should seriously consider:

Do you have other options? Is it possible for you to borrow money from a friend or a relative instead of getting a payday loan? Does the situation really require you to take out an immediate cash advance? Is it really an emergency?

Never take out more than one payday loan at a time. Payday loans are fast and easy to acquire but they carry very steep interest rates (100% – 300%). Taking out cash advances from different payday loan lenders could mean trouble later on when you find yourself struggling to catch up with repayment.

Know all the fees before signing up.The Federal Law mandates all lenders to disclose the interest rate, fees and possible penalties associated with the payday loan. Borrowers have every right to know their payment obligations.

Check with the Better Business Bureau (BBB). Make sure that the loan company is registered with the BBB and that there are no unresolved complaints filed by past and present borrowers.

Prepare your pay check.Be prepared to pay the full amount you borrowed by your next payday to avoid hefty fees.

Use the money wisely. If you really need a payday loan to survive a financial crisis, make sure that every cent will be wisely spent. Furthermore, borrow only the amount you need and don’t try to take more than what the situation calls for.

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