Cash Advance & Payday Loan Myths

Posted on Friday, August 20th, 2010 at 10:25 am in Helpful Payday Loan Info, Miscellaneous Cash Loan Info

Cash advances and payday loans online get customers fast cash when they need it most. With 100% online applications, no fax, and no credit check, cash advance payday loans are a convenient financial fix for short term and emergency cash needs. Because payday loans and cash advances don’t use credit checks for approval, their interest rates tend to be a little higher than other types of consumer credit and have attracted some negative attention as a result. Below are several myths critics spread about cash advance payday loans and the truth behind them.

Myth 1: Payday lenders are predatory and take advantage of destitute consumers.
Not true. Consumers use cash advances and payday loans for a variety of expenses, from monthly bills to large, one-time purchases. Cash advances are borrowed by consumers of all economic backgrounds, not just broke customers desperate for money. Sometimes an expense comes up that needs attention before payday. It doesn’t matter how much or how little you make in a month; if you don’t have extra cash on hand for sudden emergencies, you need to borrow it from somewhere. Cash advances are the fastest and most convenient way to borrow cash in 1-hour and all kinds of customers use them.

Myth 2: Payday loans and cash advances are too expensive with outrageous APRs.
The truth behind this myth depends on your lender. It’s true that cash advance payday loans are more expensive than cash loans with credit-based approval. No credit check cash advances pose a bigger risk to the lender, so service fees are higher to balance this risk. The typical service fee for cash advances and payday loans is $15. The APR on a $100 payday loan is generally over 300%, but such interest rates only apply if the cash advance is repaid in monthly installments over a full year. When compared to the APR on bank overdraft fees which can reach 900% or higher, cash advances are a cheaper credit option when you need cash right away.

Myth 3: Payday lenders are loan sharks only out for customers’ money.
This myth is false. States which authorize payday lending closely regulate payday lenders’ collection practices to protect consumers from harassment and abusive tactics. Reputable payday lenders will not harass or threaten customers who can’t pay. Most online lenders will extend alternate payment plan options if you need help affording your cash advance payday loan.

Cash advances and payday loans online are a safe, secure, and easy way to borrow money. Start your application today and bust the payday loan myths for yourself.

Related posts:

1. Common Payday Loan Myths
2. Instant Payday Loan Myths
3. Myths About Cash Advances
4. Pay Day Loan Myths vs. Reality
5. Cash Advance Fees & Interest Rates