Two Times When It's Smart To Get A Payday Loan

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Two Times When It's Smart To Get A Payday Loan

25 February 2022
 Categories: , Blog

There are many ways to get cash fast when you're short on funds. Some options are better than others, though, depending on the situation. Here are two times when getting a payday loan may be your best one, particularly if you're racing against the clock.

The Consequence of Non-Payment is Greater than the Loan Fee

It's no secret interest rates for payday loans are high. The average company charges anywhere from $10 to $30 per $100 borrowed, which comes out to about 400 percent interest. However, considering other fees you may be charged for missing a payment or dipping into your overdraft line, getting a payday loan is often the cheaper option.

For instance, credit card companies charge up to $39 when you pay late. On top of that, the company will ding your credit, and that negative mark can stay on your report for years, hurting your score and costing you more money in the form of higher interest rates in the long run. Taking out a payday loan to meet your financial obligation to the card company can save you money and grief.

It's good to look at all angles when considering what to do with your financial situation. Don't just think about the money. Be sure to consider both the short and long-term consequences you're likely to face. As demonstrated, getting a payday loan now can prevent a disaster down the road.

You Can Pay It Off Quickly

The nice thing about payday loans is that you can renew them at the end of the term. Typically, lenders will extend your due date by another one to two weeks as long as you pay the fee for the prior loan. Some do have rules where you must pay it off in full every so often, but the lenders usually let you take out another one right away.

However, while loan extensions are great when you run into trouble repaying the money, they do increase your costs. Thus, if you want to spend as little as possible, it's best to only get the advance when you can pay off the money with your next paycheck.

Don't be afraid get the money even if it may take you a few paydays to clear your balance, though, especially if you're in dire straits. Making sure you and your family are okay is worth the few extra fees you may have to pay to fix the situation.

For more information about instant payday loans or to get cash quick, contact a local lender.