Wednesday/February 27/2008

PAYDAY LOANS FAST BECOMING A MIDDLE-CLASS FINANCIAL TOOL

A story in the Norfolk Virginian-Pilot described how payday loans have become popular with a surprising new group: middle-class suburbanites. Payday loans have traditionally been seen as a crutch for low-income consumers, and lenders perceived as predators taking advantage of their needy situation. In fact, payday lenders are now targeting "good, hard-working, middle-class people" with median incomes of $30,000 or more.

One local resident, a pipefitter, routinely paid off one loan before taking out another to cover bills. In this manner he was able to avoid the high interest costs associated with borrowers who failed to meet their repayment obligations on time. It appears payday lending to the middle class is a trend that's here to stay.

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Friday/March 7/2008

CHRISTIAN BORROWERS SHOW FAITH IN PAYDAY LOANS

According to Forbes Magazine, areas with large concentrations of Christians are the "Promised Land" for payday lenders.

The magazine's website cited a study that portrayed such areas as the Southern Bible Belt as hotbeds of payday loan lending. The study claimed a "strong correlation between the number of payday lenders within a geographic area and the political power of conservative Christians within a state."

According to SmartMoney, industry analysts estimate that 19 million U.S. households used a payday loan in 2006. This number is sure to grow this year as more Americans look to such advances to address their immediate cash needs.
Another factor: the realization that "regular" bank lending may be restricted as a result of recent trouble in the credit markets.

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Thursday/March12/2008

SAVE A TREE WITH A NO-FAX PAYDAY LOAN

Gone are the days when applying for a loan meant filling out a stack of papers at the bank -- today's payday loans are processed and approved at the click of a mouse.

So-called "no-fax" payday loans allow the borrower to apply without having to fax documentation to the lending agent. This not only saves paper, but valuable time -- crucial for what short-term applicants are borrowing for, such as medical emergencies or car repairs.

As an article in the Los Angeles Chronicle explains: "With the no fax option, you can apply for these loans online and sit back and wait for your money to get deposited directly into your bank account... The loan gets approved within the next 24 hours and is deposited directly into the bank account."

Check your local payday lending site to see if your lender offers a no-fax application option.

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Thursday/March20/2008

WHEN APPLYING FOR CASH, BE SURE TO TAKE DUE DATE INTO ACCOUNT

There are a variety of factors to consider when applying for a payday advance, such as lending fees and APRs. However, don't make the mistake many borrowers do, and ignore the due date.

Most payday lenders offer a two-week repayment term; still, some borrowers are unable to repay the money within that time period. That's not good -- failure to repay by the stated repayment date results in additional service charges plus a higher interest rate going forward.

A lot of borrowers suffer the consequences because they're unaware they can contact the lender about extending the repayment period. If you feel you won't be able to pay back your advance within the two-week period, immediately talk to the lending agent: you may be able to buy another week or two without suffering severe penalties.

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