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  What is a payday loan?
How does a payday loan work?
Are payday loans bad?
Who regulates payday loan
lending?
What is internet payday
lending?
How much will
payday loan settlement help?
What is a payday loan?
A payday loan, also
called a paycheck advance or cash advance is a short-term loan that
is intended to help a borrower with his/her expenses until their
next paycheck. According to the Consumer Federation of America, typical payday loans vary between $100 and $1000 and
average between two and four weeks. The average annual interest
(APR) is estimated at 470%. Very often, the shorter the loan term
the higher the interest.
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How does a payday loan work?
Payday borrowers
write a personal check or electronic access to their bank account
for automatic withdrawal for the amount being borrowed including a
finance charge. Lenders loan the borrow the amount in cash and hold
the check until the borrowers next paycheck. At that time, borrowers
can pay the loan off by paying the principle and finance charge, or
simply the finance charge and roll the loan over to another month.
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Are payday loans bad?
Although payday
lending has come under controversial scrutiny in the last couple
years, the truth is that there are situations when a payday loan is
very helpful. However, just as with any other loan, but perhaps even
more prevalent with payday loans, borrowers must practice
responsible lending.
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Who regulates payday lending?
Although payday
lending is largely regulated at the state level, in 2006, Congress
passed a regulatory law, namely The John Warner National Defense
Authorization Act, capping the lending to military personnel at
36%. The Defense Department labeled the payday lending institution
"predatory". Some states, including DC and New Mexico have passed
similar regulatory laws with maximum interest rates and Georgia
banned payday lending entirely.
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What is internet payday
lending?
Internet payday
lending is when a consumer or potential borrower fills out a form or
online application and faxes it to the lender with the requisite
information including bank account numbers and social security
number, a copy of a personal check and/or bank statement. The payday
loan is thereafter, directly deposited into the consumer's account
and on the due date the finance charge is automatically withdrawn by
the borrower.
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How much will
payday loan settlement help?
While there is no
way to estimate your savings, because each payday lender has unique
circumstances with literally hundreds of contributing factors,
payday loan settlement may
reduce your monthly payments and ultimately eliminating your
payday loan debt. You have nothing to lose besides 10 minutes of
your time. So fill in the form and find out if we can help you get
our of the cycle.
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