Payday Loan Lowdown

Payday loan companies have mushroomed all over the place in a short span of time. Since the number of such companies has crossed the 10,000 business outlets mark in the U.S. and have started to become visible in other parts of world; identifying the right one for you has become a challenge. Your access has increased for payday loan agencies courtesy Internet. Now which is the right one for you?

These companies lend financial help to those in earnest requirements. Choose from where time doesn’t become a constraint for you i.e. the agency should be near to you. Thus in cases of discrepancy you can always spare some time to meet with officials personally to sort out the worry, since resorting to phone calls, most often, don’t help.

The most importantly see if they are open beyond banking hours. Location plays important role as they should be able to cash checks when banks are closed.

Online business is a real tricky one. If you know the trick, good but if you don’t then landing on troubled waters could be your fate. Pay day loan sites have increased like any other. So what’s the big deal….we do want options, don’t we? But the caution thrown in by the Consumer Federation of America (CFA) to consumers is something we need to heed. The federation has warned that accessing Internet payday loan sites, where loans due by the next payday can cost up to $30 per $100 borrowed and borrowers can typically face annual interest rates (APRs) of 650%.

Through these websites customers borrow money by transmitting personal financial information via Internet. The CFA survey states that about a hundred Internet payday loan sites for small loans involving electronic access to consumers’ checking accounts pose high risks to consumers.

The survey suggested that many lenders renew loans automatically, thereby withdrawing the finance charge from the consumer’s checking account every payday. This might be reason enough for many people to stay away from Payday loan for a long time to come.

I’ve written and written on how bad payday loans are and of how the lenders are usurious. If you’ve ever taken a payday loan, you’ll also know how the rates are unbelievably high. Most people who have taken a payday loan seem to be caught in a debt trap and there seems to be no way out of it. And it is really distressing when a person is forced to take another loan to repay the first one. That’s when you know that some drastic measures are required to correct the situation.

And the worst part is that the lender makes things worse by employing unfair means. Like for example, when you take a payday loan, some lenders require you to sign and submit a check, which they cash in case you fail to pay up on time. And if the check bounces, the lender may try to arm-twist you by threatening prosecution. AND, they knew that when you wrote the check, you had insufficient funds in your account! This is NOT allowed in certain states including Indiana.

Now there are many other such seemingly okay rules, which are not actually allowed by the law. In case you feel that your lender has violated the Truth in Lending Act, you can file a complaint with the Federal Trade Commission (FTC). Call their Consumer on toll free: 1-877-FTC-HELP (382-4357): TDD: 202-326-2502. You can also use the FTC’s online complaint form to register your complaint. But be warned, the Commission cannot resolve your individual problem, but it can definitely act against a company if there is a pattern of possible law violations. So, don’t hesitate to file your complaint