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The memoir of J.D. Vance “Hillbilly Elegy” was a huge success last year. It was one of the most acclaimed and talked-about of the summer. The story of Vance, his troubled childhood, days spent in abject poverty, and how he fought out of it, is very inspiring. All readers and even the critics praised how Vance was able to portray the hardships he faced so frankly. But his story is not the only one. Millions of Americans are fighting the odds to stay afloat and make their lives a little better.

Hillbilly Elegy has been recommended because it helps us understand the many facets of American culture and society. Robert Pondiscio from the U.S. News, Helen Andrews from National Review, Clarence Page from the Chicago Tribune and many others have said it is a must read. Clarence says, “Vance helps us to understand how shrinking opportunities for low-income whites helped to fuel the rise of Trump”.

There are other reasons as well why you must read this book, if you haven’t done so already. The book shows that too often, lawmakers and government officials come up with regulations and restrictions that are not in the best interest of the very people they are expected to help and support. There is a huge disconnect between what they perceive to be good, and the actual realities.

This is best understood from a passage in the book about payday lending.

Ohio’s Short-Term Lender Law

J.D. Vance had a troubled childhood and he came from an impoverished background. So at a point in his life, Vance used to do three jobs all at the same time so that he could pay for his studies while at The Ohio State University. One of these jobs was with Bob Schuler, a state senator. While he was working for Schuler, the senate considered the Sub.H.B. 545 bill “that would significantly curb payday-lending practices”.

According to the proposals, payday loans would be capped at a maximum of $500, the loan duration would be for a minimum of 31 days, and lenders wouldn’t be able to issue loans more than 25 percent of a borrower’s gross salary. These restrictions were against the fundamental principles of payday lending.

Only four state senators decided to vote against this bill, and Bob Schuler was one of them. The bill was passed and Governor Strickland made this law on June 2, 2008. It came to be known as the Short-Term Lender Law.

J.D. Vance came from an impoverished background and belonged to a community where people were living from one paycheck to another. Surely, he would have resented the senator for deciding to vote against the bill. Surely, Vance would have seen payday lenders as exploiters, as they were being described by almost everyone else.

J.D. Vance Was Against the Bill Too

But Vance did just the opposite. He thanked senator Bob Schuler and even applauded him for his stand. In his book, Vance says Schuler was one of the few people who understood the everyday practical realities of the lower-income citizens of the state. This is what he says in the book Hillbilly Elegy, “The senators and policy staff debating the bill had little appreciation for the role of payday lenders in the shadow economy that people like me occupied”.

Criticizing the senators who voted to pass the bill, Vance further says in the book, “To them, payday lenders were predatory sharks, charging high interest rates on loans and exorbitant fees for cashed checks. The sooner they were snuffed out, the better”!

The Experience of Vance Tells a Different Story

What the author had to go through himself and the experience he gathered gives him a perspective, which goes against the elite opinion, and so Vance says, “payday lenders could solve important financial problems”.

Why Payday Lending is Good for the Economy – Vance

Payday loans are often the only option for people without a credit card or those who cannot get a conventional loan. Many of them have taken bad financial decisions in their lives, in situations where often they had no control or decisions where they cannot be blamed. Vance clearly explains the situation in his memoir, “As a result, if I wanted to take a girl out to dinner or needed a book for school and didn’t have money in the bank, I didn’t have many options”. Only payday loans filled up this critical credit gap.

Vance then goes on to narrate an interesting story when he didn’t have enough money in the bank to even pay the rent to his landlord. Vance didn’t have the paycheck with him, and so there was no money in the bank to pay the rent. So he took a short-term payday loan, and was able to pay the rent check to his landlord with it.

That was an important lesson for him, which he hasn’t forgotten since then. “On that day, a three-day payday loan, with a few dollars of interest, enabled me to avoid a significant overdraft fee. The legislators debating the merits of payday lending didn’t mention situations like that. The lesson? Powerful people sometimes do things to help people like me without really understanding people like me”, he says.

What Happened in Ohio After the Short-Term Lender Law Was Passed

When Vance took his payday loan and paid the rent, the minimum loan duration in the state was 14 days. That was raised to 31 days after the bill was passed. So consumers could still take a loan if they wanted to, but ended up remaining in debt for a longer duration of time. As a result, they had to pay more money to the lender towards interest for the longer loan term.

This proves, a longer minimum duration is not in the best interest of consumers. They ended up losing out, all because the lawmakers and regulators wanted to protect them against the so-called exploits of payday lenders.

The passage from what Vance has said in his book is an important narrative. It is one of the many case studies, which shows how well-intentioned regulations can lead to unintended consequences and eventually be bad for the very people they are expected to protect.

We suggest, regulators and state legislators must read Hillbilly Elegy. People at the CFPB or the Consumer Financial Protection Bureau should also go through this book carefully before deciding. They need to have better understanding of the ground realities, and the real requirements of the common American. Enough has been done to cripple payday lending already. They should think twice before passing new regulations. A reality check is needed. Talk to the common man who is trying desperately to meet both ends, before deciding.

Nobody likes to stay in debt. It’s a bad feeling, and a financial state that is likely to affect the way you lead your lifestyle. For instance, if you have taken a home loan or a car loan, which are usually for the long-term, then most people will always want to pay back the month’s due before anything else. It’s a top priority. Everything else has to wait.

But what about short-term loans, like a payday cash advance, for example? These are small dollar loans where the loan is offered for a couple of weeks till the next pay day. The amount is also usually between $500 and $2000, and as such, a high majority of people can pay back their debt on time without a problem. It is not a problem usually. But sometimes, unforeseen things happen. That’s life. You may suddenly face a situation where you had to spend more than anticipated, and at the beginning of the next month, you simply don’t have the money to repay the creditor.

Harassment by Debt Collectors a Real Problem

If you are in debt, and can’t repay, many debt collectors will keep calling you, making embarrassing calls, sometimes several times in a day. Suddenly, you will see many of them turn aggressive, though there are many ethical and legal payday lenders who will give you a second chance to repay. But these are exceptions. Usually, you will be in a lot of trouble from these creditors. It is not uncommon to feel like running away.

Of course you cannot run away, because there is no running away from your commitment to pay back. All you probably need is some understanding, a bit more time perhaps, and a second chance. Almost everyone wants to pay back the debt and stay out of trouble. The intentions are almost always honest.

What Can You Do?

So how do you keep the debt collectors at bay? Is there a way? What can you do? let us find out what your options are.

According to a survey carried out by the Consumer Financial Protection Bureau, 40 percent of people in debt said they felt threatened by debt collectors. They reported callers calling them four times a week or more. And what is more serious is that, more than half of these calls were about debts that were incorrect. For instance, in some cases it wasn’t the right person or the amount due was wrong.

• So the first thing to do is to confirm that you are indeed the right person
• Second, check the amount to confirm that the amount is correct

Confirm the Collector Is Legally Authorized to Collect the Debt

You will be surprised how many times debt collectors without any legal authority will make embarrassing and harassing calls. You can put them off if you raise these issues.

Demand proof that the collector has the legal right for collecting the debt. Also, as mentioned above, confirm the amount. This is important because sometimes they will add their fees and also interest, which they cannot collect legally. If required, you may also seek legal help, and also lodge a complaint with the consumer bureau, the FTC You may also approach your state attorney general’s office.

How to Know Whether the Debt Collector Is Legal?

Ask these questions – Name of the original lender, and street address of the collecting agency. It is likely that scam callers will disconnect the line immediately as soon as you begin to ask for details.

Can You Stop These Calls Legally?

Thanks to the Fair Debt Collection Practices Act, debt collectors are bound to stop contacting you when you ask them do so in writing. There are templates in the Consumer Financial Protection Bureau website you can use. But remember, your unpaid debt won’t go away even if they aren’t able to contact you.

Also Do The Following

Get Everything Written on Paper – Debt collectors cannot pursue you legally unless you are given a written statement where your debt details are clearly mentioned. Also, you should receive this statement within five days of receiving the call. There is no need for you to say anything over the phone till you receive this letter. In fact, you may even sue the debt collector for harassment if you don’t receive the statement within five days.

Cease and Desist Letter – In-house collection agents of credit card companies and banks disclose their identities. However, there are many third-party collectors that will purchase your debt from the creditor, and they are not so forthcoming. They will always want to keep their identities secret, because they know that according to the provisions of the Fair Debt Collection Act, you can ask them to stop calling you in writing. You can force them to disclose the name and address. Then issue certified letters to stop them calling you. Always issue certified letters so they cannot deny receiving them!

Know Your Rights – Don’t believe anything debt collectors tell you. The FTC has slammed many collection agencies for deceiving people into believing they owe money, while there was actually nothing due. Know your rights in the state, which can vary depending on where you are staying.

Record Everything – Record the entire conversation you are having with a debt collector, and tell the person that he/she is being monitored and recorded. Get it in writing, if you make an agreement with the collection agency. File the letter. You will have a strong case if the agency crosses the line, and you can then take them to court.

Payday Lending and Debt – What Can You Do

Payday lending is a legal business where most the lenders follow ethical practices. Businesses that are members of the CFSA or the Community Financial Services Association of America cannot force you to repay the amount. They coerce you in any way. The lending company must give you time till the next four paydays to repay the amount due if you missed the due date. No extra fees can also be charged for this.

The Extended Payment Plan

Not many people know about this, but if you cannot repay your payday loan debt on time, then you may always ask for the Extended Payment Plan or the EPP. We also offer The Extended Payment Plan. Contact us when you are not able to pay the loan back in time.

Under the provisions of the EPP, you will have additional time to repay the debt, and the creditor cannot charge you for this delay.

But remember to inform the creditor before the business closes on the day your amount is due that you are unable to repay and need some extra time. Call up, or send an email early. Better still, don’t wait for the last moment. Inform earlier. Carry a print out of this page if you are visiting the creditor’s office. Send the link over email if you are emailing.

No payday lending agency can deny you the extra time you need

The creditor will then make you sign a new statement, which mentions the new payment schedule. There will be four equal payments in this, spread over the next four paydays. That’s four more months for you to repay the debt. The fees will be included. But there won’t be any new fees or interest. The lending agency cannot send a collection agency or hassle you to pay up forcefully.

Payday lending businesses across the country has been lambasted by a lot of critics in recent times for charging high interests. The general public has been made to believe that you should stay miles away from them because taking a short-term loan from them could land you in trouble, as you are likely to fall into a debt trap. Millions of people across the United States, though, continue to approach these businesses when they are a little short of cash, and need funding for the last few days of the month.

There have been voices of dissent also as some critics, accountants, former bankers, and lawmakers have pointed out that there is a real requirement in the market for payday loans. A large section of the population, particularly those who don’t have a perfect credit score have nowhere else to go. But these voices have been aberrations. Most critics still make us believe that payday loans are bad.

A few alternatives to payday loans have come up now and then, but none of them have worked. For all practical purposes, there is simply no alternative to payday lending anywhere in the United States at this time.

A New Study Reveals the Shocking Truth

Now, a new study shows how bank overdraft charges are way higher than payday loans. In fact, these charges could even be up to eight times higher according to the findings of this study. “Which?”, a consumer group that reviews products and services, says that consumers who borrow a loan for 30 days from banks for say an amount of $100, will often have to end up paying $180 because of the high overdraft fees. With payday loans on the other hand, it comes to $124 maximum.

Banks make us believe that their overdraft programs are a service offered to clients. It covers bounced checks and allows customers to overdraw their accounts. However, according to the findings of Which?, the service is definitely offering a bad deal for people. This is a serious cause for concern, which has not been adequately highlighted. Most people who are critical of payday loans won’t comment on these bank charges.

A large section of the population is being affected by these bank overdraft charges. In fact, as per the statistics with the CMA or the Competitions and Markets Authority, one in five bank account holders go for unarranged overdrafts, which means that 20 percent people with bank accounts have to live with these extremely steep bank charges.

Interest Rate in Overdraft Plans Can Be Really High

Unlike other credit lines, where the annual interest can go up to a maximum of 20 percent, in the overdraft plans where a flat fee is charged for processing the overdrafts, the interest rate when calculated over the entire year can be as high as 1000 percent. Also, unlike revolving credit where customers can repay their debt when they are able to, here, they have to make sure that their balances are back in the positive in just a few days. Most traditional credit lines are limited to thousands of dollars, but the overdraft plans are limited to between $100 and $300. The banks will begin to bounce the checks again once the overdraft is expended.

How Banks Are Not Serving the Public Interest

Firstly, most banks and other conventional lending agencies won’t usually offer small-dollar loans to their customers because they are interested in larger sums, even though most people are just a little short of cash and they have the regular income to pay it back after payday next month.

Secondly, these lenders are not keen about the short-term. A loan for a couple of weeks simply does not appeal to them. They are more interested in long-term big money loans such as mortgages, car loans, and such others.

Thirdly, the banks will almost always overlook individuals with poor and sometimes even those with an average credit rating. This means they are shutting out so many people without a perfect credit score, those who actually need financial help the most.

Banks and other conventional financial institutions only look at their own interest. The payday lenders are businesses too, and thus must see to their interest, but these companies are carrying out their social commitments, where the banks fail miserably.

What the New York Times is Saying

It is not just the consumer group Which?, even the New York Times is now saying that these overdraft charges have become one of the most beneficial profit-making schemes of the banks. The NYT is only citing what the consultants are saying, of course, and there is statistics prepared by government bank regulators to back up this claim.

Here is one data, for instance, which will surely shock most people. Washington Mutual, which is the seventh biggest financial institution, and also a big promoter of overdraft protection, last year made more than $1 billion from overdraft fees by charging their customers. And that too all in the name of offering a benefit to their customers!

Industry analysts are claiming that overdraft plans that include fees for each overdraft are actually high-interest loans for working-class customers.

In payday loans, there is just a regulated flat fee for the direct cash that consumers receive in their bank accounts. Bank overdraft programs, on the other hand, work automatically with debit cards and checks. To make matters worse, the consumers often do not even realize that they have overdrawn their savings and checking accounts till the time the bank notifies them.

Many banks, love such a situation because it lets them prosper at the cost of the consumer.

What the Consumer Federation of America Says

Jean Ann Fox, who is the director of consumer protection at the Consumer Federation of America recently said this while speaking on the matter, “Some banks are looking at the fact that some consumers barely make it from pay day to pay day and have a very low balance, and instead of offering them a beneficial service, they are charging their customers bounced-check fees to take advantage of the situation”.

Results of the Federal Reserve Study

According to the findings of a Federal Reserve study that was carried out recently, the problem is getting worse. That’s because, banks in the United States have hiked their overdraft fees by 24 percent from what they used to charge between 1997 and 2001.

Also, the banks are using all means to ensure they gain the most. For example, they use advanced software programs to process the largest debits and checks first, so if your account is going to be negative requiring an overdraft, the bank can charge overdraft fees on a higher number of smaller transactions.

When you add the $15 per of average merchant penalty for each returned check, five overdrafts for $200 can add up quickly to become $375 including charges. With payday loans, on the other hand, the fee would just be between $45 and $60 for a loan of $200.

It’s not us, the payday loan industry, which is saying these things. These findings have come up in the investigations carried out by the Federal Reserve, Consumer Federation of America, Which?, and other independent analysts. There is enough evidence to prove that the payday loan industry is looking after consumer interest better than the banking business. The tide is turning. Many critics too are beginning to believe this.

Lawmakers across many states in the US have passed a number of regulations over the last few years severely limiting or preventing payday loans. Sometimes also referred to as quick cash loans or installment loans, there has been serious repercussions as a result. Quite a few states have completely banned these loans, saying that this leads to debt trap, though many analysts and experts aren’t quite sure about this conclusion. In many places where severe limitations have been placed, the number of payday lenders has come down drastically.

However, in spite of all these measures, payday loans have remained popular for years, revealing a fundamental need for these cash advances for lower income group people, and their popularity among the masses. For instance, in Alabama, people took more than 2 million such loans in 2015, with the average loan in the state being $326. 246,824 borrowers in the state approached lending agencies for money. These loans remain popular all along the Mississippi Delta.

Also, research carried out by Future Finance has discovered that 31 percent students from all types of backgrounds depend on these sources for covering their university expenses. The study was carried out among 1,000 full-time students. Often it is said that only people from poor backgrounds, and the blacks, Hispanics and Asians take these loans. This study shows that it is just a myth. It is also said that those who need payday loans have poor financial management skills. But the study found that 63 percent of the students who asked for financial assistance have good knowledge of finance.

The Finding in Utah

A new study carried out in the US state of Utah further reveals that all these regulations and ordinances passed in recent times have had little effect on payday lending. This proves once again that a lot of people, cutting across virtually all sections of the society have a basic necessity for payday loans, when they face financial emergencies.

This particular study was carried out by the University of Utah. It shows there has been little effect on payday lending in spite of the many ordinances passed to regulate such loans. This is a remarkable finding, because some people are of the opinion that payday lending rates in the state are among the steepest in the United States.

Utah Cities Were Among the First to Adopt Ordinances

The cities in Utah were among the first ones to adopt ordinances that limited the number of these loans people could take. Utah was also among the first states that limited the number of payday loan stores by population, and required a minimum distance between them.

So the ordinances have been in place for some time. Those supporting them have tried their best to prevent payday lending. But these quick cash loans remain popular nevertheless. Isn’t this a complete rejection by the people of what the regulators think are good for them? Let the people have their say!

Nathalie Martin from the University of New Mexico, and Robert N. Mayer from the University of Utah, the researchers, agrees. In the study, they looked at the results of reigning in payday lending in Dallas, Salt Lake County, and the Silicon Valley of California. A case study was included on how 11 Salt Lake County communities came up with ordinances for limiting how many payday lenders can operate in the regions, and their proximity to one another.

Quoting activists who had earlier wanted these ordinances, the study concludes by saying that little has been achieved. That’s because, payday loans remain as popular as before. For instance, President of the Coalition of Religious Communities, Art Sutherland, says there hasn’t been much of a change in the number of stores offering payday loans, a clear indication that these loans remain popular.

“It may be a little hard to shop around because you are going to need a car instead of being able to walk from one store to another. But borrowers can still take a loan easily. Perhaps we misunderstood what the requirements of the people are”, he says.

Christopher Peterson, a law professor at the University of Utah, who has been at the forefront of criticizing payday lending, agrees. He says there has been little effect of all these local regulations overall. So perhaps it is time to take another look at whether we did the right thing, he added.

More Payday Lenders Than Burger King, McDonald’s

An indicator of how popular payday loans are in the state is best demonstrated by the fact that there are 553 stores offering them in Utah, even after so many ordinances. In fact, there are more such stores than the combined number of Burger King, Wendy’s, McDonald’s, and Subway restaurants in the state.

Wendy Gibson, who is a spokeswoman of the state’s payday loan businesses, the Consumer Lending Association, says lenders believe these ordinances have had almost a zero effect on people, because there is a real need in the society of getting financial help when in an emergency. In the absence of any other practical alternative, residents of the state will always approach the lending businesses.

Phillip Hill from Midvale has observed the number of payday lending businesses in his community come down from a dozen to about nine. However, according to him, this wasn’t because of the ordinances, but because, there were too many lenders in the first place. The one’s that closed lose out to the competition, he says. He cannot find any signs that the demand for payday loans have dropped, Phillip adds.

Improve the Economy Instead of Targeting Payday Lending

All over the United States, including the state of Utah, lawmakers have imposed a variety of restrictions to prevent or at least limit payday lending. This has been going on for many years now. But this has not helped. Payday lending has not contracted overall. Their demand has not gone down.

That’s because, people still need more cash when in an emergency. Their pay, earnings need to go up. A lot of Americans are still outside the banking system. The banks and conventional lending systems are still unwilling to offer short-term credit. Most Americans still don’t have adequate savings they can fall back on.

These are the real worries of the economy, and not the payday lending companies, which are legal businesses. If you don’t want payday lending, first focus on the economy. Improve it. Give people better jobs that pay well so that they can save money after spending on their basic requirements. That is the way to go.

If you need a loan you can apply with us.

A man from San Diego, Doug Farry, has been meeting human resource managers, chambers of commerce, and city councils relentlessly for almost two years now, explaining to them what he knows from his experience as a former banker – many workers are forced to live from one pay check to another, and often face acute financial troubles in between. Doug runs a start-up that offers payday loans to employees with a steady job and salary, but people who could do with some additional funding in times of need or when they face an emergency.

Doug Farry has worked in a bank at Minnesota for many years and explains how the conventional banking system falls short of offering a real and practical solution to people who are just a little bit short of cash. Banks and other conventional lending agencies are simply not good enough, he says.

They are not interested in issuing a $1000 loan for a couple of weeks. The earning is too less, and the processing costs are too high for the banks. There is a real demand in the market for these types of loans, but the conventional lenders don’t offer a solution.

Employers Know Their Workers Have a Cash Problem

Its common knowledge for Farry and many other bankers, and even the employers, that many of their workers will often face a crunch in the middle of the month. There is nothing the employers can do in most cases. Salaries cannot be raised just like that unless the business is able to make more money or the worker adds to his qualification. It is difficult to find another job that pays better as there simply aren’t that many jobs available in the economy.

Sometimes, an employer will offer a cash advance, to be deducted from salary on the pay day, but that cannot happen with every person. Most employers will never even consider this as an option, though.

There are others who won’t do this, because they don’t want to get into the financial lives of their employees. Fair point! It can work the other way as well. For instance, an employee may not want to approach the CEO asking for an advance. It is too embarrassing. A payday loan, on the other hand, works discreetly. You can apply online, and the money is deposited directly into your bank account. Nobody has to know that you are running a bit short of cash. There is no need to approach friends, relatives, neighbors, or your employer.

Many business leaders also have this misconception that a cash crunch situation is a problem only with the homeless, unemployed, or people who fail to manage their financial situation efficiently. They are simply living in the denial mode, or don’t realize how grave the condition can sometimes be for the millions of Americans.

Doug Farry argues, “If you’re a CEO, making a seven-figure salary, this concept may not register with you”. The fact is that, if there is a real emergency, if you are living from one pay check to another, and if you don’t have considerable savings, which most people don’t, then it can actually be very difficult to come up with the required funds all of a sudden.

Doug’s payday loan program issues short-term cash advances that are typically between $1000 and $3000 to employees with a steady salary and income. He has been offering these loans for the last four years now, and is working with many employers closely. So whenever an employee approaches one of these employers for an advance against the pay receivable, the business forwards the request to Doug.

What Makes the Doug Farry Story Is So Remarkable

There are many other agencies across the United States, of course, which are offering payday loans to people in real needs. And like Doug, they don’t consider the credit history of the applicants when processing the requests. These are all legal businesses offering a valuable service to people who don’t have anywhere else to turn to.

But the Doug Farry story is still a remarkable one, because here a former banker not only acknowledges the shortcomings of the banking system, but actually goes forward and issues payday loans to employees, and that too with businesses that sometimes employ hundreds, and even thousands of employees.

Payday Loan Restrictions – It’s the People Who Are Paying the Price

This is a validation of the position of payday loan companies, which have faced so much criticism in recent times. A lot of federal and state laws have been passed in the last few years to restrict the operations of these legal cash advance businesses, but the authorities haven’t been able to come up with any practical alternative yet.

Yes, many payday lenders have had to wind up operations as a result, but the real sufferers are the people, those in need of quick cash relief. Many of them had to file for bankruptcy, while others had to approach the grey market, where the illegal lenders ended up charging an insanely high interest and fees.

Some employers and payday loan companies have even come up with unique schemes where the debtor doesn’t have to pay the interest or fees. This is an employee benefit being offered to make their life just a little easier, and make the business and workplace more attractive. The debtor just has to repay the amount they originally borrowed.

12 Million Americans Take Payday Loans Every Year

There is a huge demand all over the country for small dollar loans as a lot of people from different backgrounds and demographics face financial emergencies in the middle of the month and have little savings they can fall back on. In fact, according to estimates, as many as 12 million people in the United States take payday loans. Together, they borrow billions of dollars every year.

People with all kinds of needs apply for these loans. There are those who are in a real emergency such as an urgent car repair without which they cannot go to work and thus face a potential earning loss. Then there are people who have to buy medicines or need to pay their utility bills.

But there are others whose requirements may not seem to be an emergency, apparently. In Doug Farry’s experience, there was a person who wanted to buy lumber for a new deck. There was another who wanted the money so he could visit his grandma who was very ill, perhaps for one last time.

Personal preferences, requirements, and priorities differ. So we can never judge what’s important to someone else, by comparing with our lives. Just a few dollars can make all the difference. It can make life so much easier, so much more fulfilling and satisfying. It would be cruel to deny them this money, especially when they are in a position to repay it in a couple of weeks. Remember, a high majority of people who take a payday loan are committed, and repay the money quickly.

There is absolutely no reason why the Consumer Financial Protection Bureau or the law makers should clamp this down.

The economy works on credit. In other words, you need good credit for virtually everything – a student loan for paying the college fees, mortgage loan for the house, a car loan for that new automobile. Good credit will be the make-or-break difference.

How the Credit Score Affects Our Lives

All of us have a credit score, which determines our “creditworthiness”. There are credit rating agencies that evaluate and come out with these scores. It is a three-digit score that is used to determine whether your loan applications are going to be approved or rejected. But creditworthiness can sometimes go even beyond that. For instance, the credit score is used to decide how much you pay towards insurance, whether you can rent that nice apartment, and even whether you will get that job or not. Yes, employers, landlords, and insurers can all access your credit score before deciding.

A good credit score can thus make a huge difference, even if you are not actively seeking a loan at this time. Bad credit will indicate that you are a risky bet. Good credit, on the other hand, is an indicator that your life is on the right track. It’s that important.

It would be worse if you actually need finance. As per financial theory, if you are deemed as an “increased risk”, then the creditor will charge a risk premium over the price at which the money is given to you. So either the lender will deny you the loan, or they will give you the money, but at a higher interest rate than someone who has a better score.

Here’s a Unique Way to Improve Your Credit Score

One good way of improving your score is by showing them that you are committed about meeting your financial obligations and can actually pay back the loaned amount. But that is easier said than done, because if the banks deny you the loan in the first place, how will you ever pay it back? Even if you get the money, it is in such a high interest rate, that it becomes very difficult to manage everything.

So with poor credit, there is hardly anything you can do to improve your score.

But wait! There is one way that works wonderfully well – payday loans.

A payday lender is the only creditor that will never deny you a loan even if you have a poor credit score. In fact, payday lenders don’t even consider traditional credit scores. They can afford to do this because payday loans are short-term cash advances where you have to make the repayment on the next payday. It’s for 2-3 weeks max. Plus, the loan amount is also rarely above $1500. Because of these two reasons, there is rarely any risk for the lending agency.

This means that you can get a payday loan very easily. There are just a few conditions – you need to be a citizen of the United States, you should have a bank account where the money can be transferred directly, and you should have a stable source of income. So you see, almost everyone qualifies for a payday loan.

Improve Your Credit Score With Payday Loans

If you meet the above criteria, you qualify for a payday loan, irrespective of your credit score. This gives you a chance to repay the money, show your financial commitment, and score a few cookie points with the credit rating agencies.

While we won’t claim that there is a direct relation between the two, and it is illegal to do so as well, but having said this, it is a fact the agencies do take note that you were able to repay within the due date. Nobody can deny this. No legal payday lender can claim to submit the information to the rating agencies. This is not required as well. The agencies will get the information on their own that you have repaid on time. This is bound to reflect on your credit score.

So if you take a payday loan a few times, and repay on time, every time, then for all practical purposes, you have an even better chance of improving your creditworthiness.

The Risk-Free Game

A payday loan is among the best credit instruments to play this game, as there is hardly any risk for you. The loan amount is small (it is usually between $500 and $1500), and will thus be extremely manageable. The term is only for a few weeks as well. So how can an $800-1000 loan for a couple of weeks harm you?

So go ahead and apply for a payday loan if you are denied any other credit, or if you have poor credit score. Repay the loan and take another one. You are likely to see an improvement in your creditworthiness in a short time.

Payday loans have received a lot of bad press in recent times. The federal government and many states have imposed a number of restrictions as well. But these are legal and good loans that provide people the money they need in an emergency. It is the only place people with bad credit can turn to, because every other lending agency will turn them away, leaving them to approach the gray market, where they will be clobbered.

In spite of the bad press, millions of Americans are still approaching payday companies. According to The Future Finance research, about a third of all students in UK depend on payday loans, credit cards, and overdrafts to fund their university education. If in UK students depend a lot on payday loans and credit cards, the story must be same in US as well. People in Alabama took more than 2 million payday loans in 2015. It’s often the only choice in the Mississippi Delta, and many other parts of the country.

What You Can Achieve With a Better Credit Score

Think of all those good things you can enjoy once you have improved your credit score by paying back the payday loan.

  • You will have more negotiating power – Negotiate to bring down the interest rate on your new loan or credit card. Tell them you are receiving great offers because of your healthy score.
  • You will get higher limits – Banks will agree to lend you more money if your score is good, particularly if it is ascending. They will have the confidence in you because you have the ability to pay back on time.
  • Better deal from auto insurers – Automobile insurance companies use bad credit score against people to charge higher rates. They say those with poor credit file more claims. Show off your improving score and bring down the insurance premium price. Pay less towards insurance.
  • Easier apartment and rental house approvals – More and more landlords are accessing credit scores for screening tenants. It will damage your chances if the bad score was caused because of an outstanding rental balance. Bury that incident by showing an improving score.
  • Cell phone on contract without security deposit – When you have a poor score, cell phone service providers might not give you a contract. You must select a pay-as-you-go plan that is more expensive. With a good score, you can receive a hundred-dollar discount on a new phone when you sign a contract. The security deposit can also be waived.
  • Don’t pay security deposit on utilities – They can be between $100 and $200, and can be very inconvenient if you are relocating. Why pay, if you can avoid doing so? You won’t have to pay these deposits if you have a high credit score.

Higher fees, rent, interests and so on can add up quickly to cause a severe dent in your pocket. You can avoid this by rectifying your credit score.

Payday loans offer a great opportunity to do this. These loans give you a second chance to prove that your financial position has improved, and you are now in a position to meet your financial obligations.

So you see, a payday loan is not just an instrument that helps people fight immediate financial emergencies. These cash-advances can help us in many other ways as well.

There are two clear viewpoints on payday loans. Many individuals are convinced that these short-term loans are the way to go because it helps them stay liquid when they are running a little short of cash. Plus, they can always turn to these cash-advances in an emergency such as the car breaking down, sudden house repairs, or medical bills. There are millions of such people across the United States who is approaching payday loan companies for these short-term cash advances.

Then there are the critics who believe payday loans are a debt trap as a large section of the population are not able to pay back on time. The statistics, though, tell a different story. These loans are not a problem for a large majority of people, as they always pay back on the due date. But having said this, there are always a few individuals who cannot repay the loan on payday, mainly because of financial mismanagement. But that happens with any type of loan, and not just payday.

However, we will still like to work with those who might face problems in repaying the loan in time. So here’s a guide that should help them.

Remember these tips before you apply for a payday loan. They are about more efficient money management and a few other points.

What You Must Remember Before Applying for a Payday Loan

1. Automate Your Debt Payment

There is very low rejection with payday loans because the lending agencies don’t look at the credit score. But the companies do want their money to be returned so that they can lend it again, and will thus look at your ability to repay. So you should have a stable income source. This means that, your application is going to be approved only if you are getting a salary every month, or can show another source that is giving you regular income. That is a basic necessity.

It will be much simpler if you just repay your debt with money received next month. Experts have always said that you should first save, and then spend with money you are left with. But there are some who would rather spend it first, and then look at repaying their financial dues. This will certainly cause trouble, if not today, then tomorrow.

Go to the bank and automate your debt repayment. This should be easy. Make sure that the money is deducted from your account and paid to a creditor on the due date once new funds are added to your account next month. All other payments can wait. Spend the balance money in your bank account after this.

Most payday lenders have the automate payments form with them. Ask for it, and fill it up. That way, you don’t even have to go to the bank to set up the automatic debit. Once done, cash will be debited from your account and paid to the lending agency automatically on the payday. This is the safest way to avoid missed payments. There are those who have cash, but forget to make the payment on time, like for instance, credit card payments. Automating payments will help them stay away from late fees.

2. Reduce Your Expenses

Try to stop making all unnecessary expenses when you are in debt. That is the last thing you should do. Make this a central objective of your life, at least for the time being, till you have repaid the debt entirely. This way, you will be able to manage money better. Cut down the expenses wherever possible.

You need a plan for this. Make a list of all your expenses for the month, and identify the ones you can avoid making. Remove the costly cable package or cell phone plan. Go for something simpler. Bring down the grocery budget for the month. Stop all those impulse purchases that we all do, and regret later. There will be always things you can do without. This approach will help you save money, so that you will have more in your bank account. Not just the short-term, this is a great strategy for the long-term as well. Perhaps you may not need a loan itself.

3. Increase Your Income

We all want to earn more money, but very few do what it takes to increase the income. We try to perform to the best of our abilities, in the hope that the pay will be hiked. But what if your employer doesn’t increase the pay?

Explore the possibilities of a second string of income. You can pay the debt off quickly with the extra money you make. There are many ways to earn money. It isn’t really as difficult as many people believe. For example, there will almost certainly be things you don’t need. Why not sell them on eBay or may be have a garage sale?

Take the payday loan for the immediate emergency, and once you have time, sell them off to make some extra cash so that you can pay off your debt. You can reduce the clutter at home as well, if you sell off things you don’t need.

Here are two more ways of making some extra bucks. Why not start a blog. Write about your hobby or a subject you know a lot about. Alternatively, you can take up a weekend job as well. That should add to your present income.

4. Make Small Payments

Payday loans are small-dollar cash advances. The amount you get is typically between $500 and $1500, which you need to pay back, plus interest, after receiving your salary or income on the next month. However, why not pay back a portion of the due amount even before that, if you have some extra cash? This way, the eventual burden will be reduced, and it will become much easier to repay the amount later.

Also, when you repay as soon as you have a little bit of cash, you won’t end up spending it on things you don’t need, or expenses that are not a priority at this time. Many payday lending businesses allow their debtors to make middle of the month small payments.

5. Prepayment Penalty

However, there are some payday loan companies, which will charge a penalty if you pay back before the amount is due. Always check this out before you take the loan.

There is hope even if you have taken the loan already with prepayment penalty. Calculate the penalty amount in money terms, and compare this to the interest amount you will save if you pay back earlier. It would make sense to pay back earlier if you find that it is working out well for you. Pay it back even if you are in the negative by a little amount, because of the lower burden on you later.

6. Bring Down the Rate of Interest

If possible negotiate with your payday lender and see whether you can bring down the interest rate. But make sure that the new lower interest rate is mentioned in the loan document. Sometimes, there are businesses that will agree because they want your account. They will agree when they find that you are serious about paying back the debt in time. It is always easier if you can pay back at a competitive rate of interest.

7. Renegotiate Loan Terms

Try to renegotiate the loan terms, if you find that you are still unable to repay the loan at the end of the month for whatever reason. Show your commitment to meet your obligation. Many lenders will be impressed and will do their best to help you. May be the interest or fees can be brought down. There is no harm in asking.

The payday loan companies too want to have the money back so that they can lend it again. Inform at least a week in advance that you want to pay it back, but need some time. Most agencies will try to find a way.

8. Borrow Against Life Insurance

With payday loans, you will get the funds really quickly, often within 2 business days, or less, which is what you need in an emergency. It is transferred directly to your bank. There is time, when the funds are arranged, so seek other options. For example, you can borrow money against life insurance. There are other policies and savings as well that you can use to get funds for paying off the debt.

You will get less money later. However, it’s still a good deal because you are leaking money at this time, and need to find a way to stop that. The interest of life insurance is less than the commercial rates. So you save money when you borrow against it.

9. Borrow From Your 401(K)

If you have the 401(k) retirement plan at work, then you will be able to borrow up to 50% against it. Find out the amount you have in your 401(k) account. Take out a portion from this for repaying your debt. You don’t need to take out a lot of money, as payday loans are typically small-dollar loans.

10. Get Tax Deductions You Are Eligible For

Do you get all the eligible tax deductions? A lot of people miss out, just because they are unaware of the details. Seek the help of a tax professional if needed. you will save money that can be used for paying off the debt.

Statistics of the present banking system in the United States will shock most people.

Twenty-seven percent of American homes, which come to one in four, don’t have access to the complete range of banking services. 7 percent of all people in the US are “un-banked”, which means that they do not have access to insured bank accounts, or any banking services. Plus, about 20 percent of homes in the United States, are “under-banked”, which means these people have an account at the bank, but don’t use banking systems for transactions or their credit needs.

Leading Presidential Candidates Raise Financial Inclusion Issues

The issue was raised briefly during the recent Presidential election, with both the leading candidates promising swift action to rectify the situation. But the situation is nothing new. Experts had pointed this out even after the economic turmoil of 2008 and asked the administration to prioritize financial inclusion.

But nothing much has changed, though almost a decade has passed since then. Payday loans or quick cash loans have remained the best bet for a large section of these un-banked or under-banked Americans who need credit. Yes, a few alternatives have been launched from time to time, but nothing has worked. For a large section of the population, payday loans remain the only viable and practical option.

What’s most worrying is the result of a recent survey carried out by the Federal Deposit Insurance Corporation. This survey confirms that formal financial services are highly skewed towards the well-educated and whites. The informal sector on the other hand is tilted towards the less-educated and minorities. In this FDIC survey, they looked at data from last year. But that is changing fast, as more and more people from all backgrounds are approaching payday lending agencies to meet their short-term fiscal gaps.

Download the Survey Here by FDICReport Economic Well Being US Households

Why Payday Loans Are Good for the US Economy

State of the economy improves when people have steady jobs, income, and can also access financial services and products they need. The overall economy grows when more and more people become a part of it. When people participate in the economy, there is a positive impact on the economics of those earning less, because, over time, they too have the opportunity to improve their financial conditions.

However, there cannot be economic stability, if consumers face financial uncertainty. It is absolutely essential that they have adequate liquid assets, or can borrow money easily when there is a financial emergency. Almost every home faces such situations sometimes, so it’s quite common. Consumers should be able to both save and borrow for the health of the financial system. Without this, people have to depend of friends and family, or worse, they will end up becoming a victim of unethical lenders who charge really steep fees and interests, thus causing a debt trap.

That is precisely what is happening now. A large section of Americans cannot borrow money from conventional banks as they are either un-banked or under-banked. These banks won’t give them the money they need also because these people don’t have a perfect credit score. Plus, the amount they require is often too less for the larger banks, so they are not interested.

Payday and quick cash loans remain their only hope. It would be a serious problem, if these loans are disallowed as well. Where will the millions of Americans turn to in a real emergency? They will be left with two choices – either declare themselves bankrupt, or approach the grey market and get exploited.

Most Developed Countries Are Doing Better Than the United States

The World Bank started measuring financial inclusion in 2013. The US lags behind many other developed countries significantly in providing access to banking services. For instance, in Germany, France, Britain, and even South Africa, every person has a basic bank account, and can access financial products that offer many services, including bill payment, money transmission, and cash. A basic bank account also promises them insurance, savings, and affordable credit.

It’s not the case with the United States. This is one reason why we see financial instability, and why so many people cannot save for emergencies.

So the next administration led by Donald Trump should focus on financial inclusion to make sure that more Americans are brought under banking. That should be the priority, and not the fight against payday lending companies that are actually part of the solution. These businesses with their services are helping to prevent the American economy from completely breaking apart. These services are allowing families to stay liquid and avert serious financial crisis, which may even cause social unrest according to some people.

Federal Reserve Survey Shows Alarming Situation

According to a survey carried out in May 2016 by the Federal Reserve, close to 50% Americans don’t have any savings. The situation is not at all comfortable. They don’t have anything to fall back on in an emergency, are often denied by the big banks, and would be in real trouble if payday loans and cash advances are not allowed as well.

Are Payday Loans Bad for the Poor?

The payday loan market has grown quickly since the 1990s. In fact, according to an estimate of the Federal Reserve, about 11 million people in the United States are taking these loans every year now.

But in recent times, there have been complaints of high fees and interests. Critics point out that the APR or Annual Percentage Rate of payday loans comes to 200%. However, the reality is that, the charges of bank overdraft fees, when amortized over the full period of one year is actually much more than what the payday loan companies charge.

The bank’s interest on overdrafts exceeds 1,000% annually, much higher than the 200% of payday companies. Also, it would be unfair to attach an unusual percentage rate for payday loans that are typically for 2 to 3 weeks.

Growing Support for Payday Lending

It is becoming increasingly evident with each passing day that payday lending is offering good value to a lot of people. There is also increasing evidence that there is no other credit instrument that works for the millions of poor and mid-income American homes.

Case 1 – A study carried out by Christine Dobridge of the Federal Reserve in 2016 finds that payday lending supports families when they face extreme misfortune, like a natural disaster, for example. The study paper comments, “Payday loans helps households keep food on the table and pay the mortgage”.

Case 2 – There is more. Gregory Elliehausen from the Federal Reserve and Chintal Desai from the Virginia Commonwealth University have carried out a detailed study to understand how consumers are affected by the payday loan ban in Georgia. According to their findings, the ban has negatively affected the ability of consumers to pay off other debts. Gregory and Chintal conclude by saying, “payday loans do not appear, on net, to exacerbate consumers’ debt problems”. They both have asked for an immediate halt on passing new regulations against payday lending.

Case 3 – Mehrsa Baradaran works as a professor of law at the University of Georgia. In June 2016, Mehrsa wrote in the Washington Post that payday lending fills a “void created by banks” that do not sell small loans to people who are not economically well off as these loans are not profitable to the banks. She suggests that the post offices should become public banks, but adds that won’t work too, unless there are subsidized interest rates.

Payday lending businesses don’t offer subsidies. They, like the big banks, need to make a profit as well so that others in need can have credit. These businesses offer a valuable service. They are the only hope for millions of Americans who need urgent credit. The fees and interest too isn’t as high as what the banks charge for overdrafts.

Many studies have revealed that America needs the payday loan industry. It could be complete chaos if it becomes impossible for these businesses to survive.

It is important to know the features and benefits of bank loans and payday loans to know the truth.

Payday lending has been receiving bad press over the last few months. Some people are claiming that these loans charge outrageously high interest rates. Further, it has been pointed out that the payday lenders follow predatory practices that can push their consumers back against the wall and send them spiraling down the debt tunnel from where it is difficult to escape. The entire industry of payday lending has faced a lot of criticism on these counts.

Is the industry really this bad? If it was, then why do the millions of Americans still prefer these loans over other credit sources?

Here’s the reality – stack up the costs of payday lending, and compare them with the fees of traditional banks, and you will find a different villain. It appears, the millions of Americans are not wrong, after all.

The Payday Loan Details

Most payday lending agencies offer short-term personal loans where the average cost is between $12 and $22 for each $100 you borrow. In other words, the interest rate is usually between 12% and 22%. The actual loan amount is rarely above $1500 or $2000 max. These are short-term loans where you have to pay it back within two or three weeks, after the next pay check arrives. The money is deducted automatically from the bank account that you have provided while applying, and the account where the lender had deposited the amount.

The Charge and the Real Question to Ask

Those who oppose payday loans say that when their percentage is amortized over the full period of one year, the APR or Annual Percentage Rate would come to a staggering 200%. Yes, truly the APR or 200% certainly seems outrageous, but the real question is, why are the opponents of payday loans attaching an unusual percentage rate for loans that are typically for 2 to 3 weeks?

Ask this question, and you will begin to see a self-serving purpose of the true villains.

The fact is that, most groups that vehemently oppose payday loans and other short-term personal loans are made up of big banks and traditional lenders. They claim to oppose such loans to protect the average American consumer. Take a deeper look at these so called “protectors” and their practices, and you will find a different story.

The Abusive Bank Overdraft Fees

Let us assume for a moment that a consumer with an average bank checking account is running short of cash and wants $200 till the next pay check arrives to pay for groceries and pay a few small bills.

In reality, it is almost impossible to get a loan of just $200 from a traditional lending agency in less than 24 hours, particularly if you have less than perfect credit. In the absence of a payday loan, the consumer will be left with no other option but to write checks for these bills, even though he knows very well that there is no money in the bank to cover for the checks. So the bank will charge him overdraft fees.

With most banks, these overdraft fees are about $35 for each bad check. The money is debited automatically from the account the consumer holds with the bank, as soon as fresh cash is deposited into it, and if the deposit comes in after the billing month ends, then the bank will also charge an additional late fee. This will further increase the money that has to be paid to the bank.

How Banks Charge 1,000% Annually, While Payday Lenders Charge 200%

Let’s say a consumer had to write 3 overdraft checks with a total sum of $100 for paying bills. With a $35 fee for each check, the total outstanding amount would now be $205, for an original debt of $100. The simple interest rate here is 105%. Reality check! Now if we amortize this amount into an annual percentage rate (like what the bankers do for payday lending), then the bank’s interest on overdrafts will exceed 1,000% annually, which is way higher than the 200% charged by the payday loan companies.

But wait, the late fees charged by the banks are yet to be added. Add them, and what the banks are currently charging the consumers will go way beyond 1000%. Point this out to the banks and other traditional lenders, and you won’t get a satisfactory reply from any one of them.

It Can Get Even Worse for the Consumer

The bad news for the consumer isn’t over yet.

In the above mentioned hypothetical situation, the three vendors that received the bad check are likely to charge the consumer between $20 and $45, which means that the cost of not taking a payday loan becomes even higher. Plus, you cannot write a bad check knowingly. It’s against the law. In most states, this is a jail offense.

In spite of what the large corporate banks, and the lobbyists want you to believe, if you take an objective look at the whole picture, you will begin to realize that the payday lending businesses are actually offering you a better deal. In fact, the payday lenders are often the only hope for the low-income and even the middle income consumers, who would otherwise have extremely limited credit options with conventional banks.

So consumers in the United States need payday lending. The truth is, these businesses would have been wiped off, considering the fact that so many restrictions have been imposed on payday lending in recent months, if there wasn’t such a great demand for these loans, and if consumers didn’t find the service useful.

Traditional banks and lending agencies aren’t flexible enough to meet the requirements of consumers who need quick cash in an emergency. They are not listening to the genuine needs of people who don’t have perfect credit history. Many of these banks are even not interested in small dollar loans. A loan of $1000 for 2 weeks is not a big deal to them – it doesn’t help them achieve their high ambitions. But that’s all an average consumer needs. It’s what the market needs.

Currently, there is no product in the market that matches the requirement of the average consumer better than a payday loan. There is no alternative to these quick cash loans, and that is the reality.

Also, don’t believe for a moment that the industry is charging you very high. Take the above hypothetical case as an example. It clearly shows how the traditional banks can charge over 1000% annually, while with the payday industry it is just 200%. The actual effect is way softer as the loan amount is smaller and the term is just for a few weeks.

So the payday loan companies are not the villains they are made out to be. If there is a villain, then that is your big bank president who sees the payday lender as someone who is encroaching upon their profit margins. Always remember, the big banks are hiding their steep overdrafts and late fees, while trying to “protect” the American customers.

So do not worry apply for your payday loan today.

There is a problem with our banking system and conventional lenders. Sure enough, there is a lot of money in the banks, and there are many individuals and businesses that want to borrow this money for business growth or personal requirements. It might be easier for businesses, but how many individuals, a little short of cash, will get the money they need in an emergency?

It’s like being bullied at school for low grades. You don’t feel good when you are snubbed because you lack something, especially low credit score. This is why so many people in the United States are still outside the banking network.

Many Traditional Lenders Deny Small-Dollar Loans

Most traditional lenders will reject applications for short-term installment or payday loans, irrespective of how many times you visit the bank, or what you say and do to convince them. It simply doesn’t work. Then there are banks that won’t even accept applications for a small-dollar quick-cash loan, because the amount in question is too small for them. They are simply not interested.

But you don’t need $20,000. All that’s required is $1,000 or less, and no one can force you to take a larger loan and get into a debt trap for 20 years.

It’s time to get wise and act rationally if this situation sounds familiar to you. You cannot fight a bug bully. You have to act wisely to overcome a difficult situation. Do fight back, but you need the right strategy. This is how you can get a short-term installment loan when you are short of cash and need to survive till the next payday.

What to Do If Your Application for Installment or Payday Loan Is Denied

1. Schedule an appointment with the loan officer and ask for the specific reason why your loan application was rejected. Ask for the reason in writing. But often, you will not get a written statement. Ask the officer for suggestions on what you can do to improve your chances the next time you apply. You are likely to be in a better position once the issues are addressed.

2. It is entirely possible that you have a good credit record, but your loan was still denied. Show your record to the loan officer. Also, if you have a mortgage, and if you have been making payments regularly, then disclose the details to the officer. Alternatively, show your rent receipts, if you are living in a rented property. Show that you have been paying the rent consistently every month. The loan officer might reconsider if you can prove that you have been responsible in the way you manage money. Full disclosure might work in your favor.

3. One reason why conventional banks deny short-term loans is because of a poor credit score. Perhaps you had missed a couple of payments some time back. This is sure to affect your credit score negatively. But it is entirely possible that your financial situation has improved in the meantime, perhaps because of a job change, bonus, or an increment. But your better position will still not be reflected in your score because the credit bureaus tend to hold negatives for a long time. You can approach them for an updated score and even submit an application for a review with all documents. Your score can improve after verification.

4. There is another option for you. Find someone with a good credit record to support the loan application you are making. The person can be a friend, a family member, and even your spouse. Ask the person to stand as a guarantor. But always be sincere with the person. Tell your situation clearly to him or her. Show gratitude for the help you are receiving.

Approach an Alternative Lending Agency Instead

You may have to seek other alternative lenders if these measures don’t work.

1. Find a lending business that offers bad credit installment loan. Many would lose their nerve when faced with an emergency, and may end up signing for a loan without carrying out detailed research first. This can be a costly mistake.

Don’t be hasty. You will have to plan it correctly. Try to find a non-traditional lending agency that offers short-term installment loans to those with bad credit. A payday loan is another option. In this, you will get the money you need, but have to return it after the next payday. Both are good options.

An installment loan is typically within $2,500, while payday loans are for amounts of around $1000. Both these types of loans are disbursed quickly. There is no credit check as well, so you will be approved even with bad credit. Choose the kind of loan that suits you the best.

2. Dependability ad affordability – Compare to decide. But above everything else, you should be able to depend on the lending agency. Ask if you can get an extension if you are unable to return the money when it is due. There are many agencies that will give you this extension. Ask to verify the interest rate.

Finally, decide how quickly you want to pay it back to get out of debt. Payday loan might be the better option here, for two reasons. First, your debt burden is less, and second, the loan term too is less. So you will be debt free by the start of the next month. But take the installment loan if you think you need a bit more cash.

Ensure that all state and federal laws are being complied with. Read all the terms and conditions carefully before signing anything.

Payday lenders and other alternative lending agencies are offering a valuable service to people in distress, those who need money in real emergencies. Millions of Americans from all corners of the country are approaching these companies, including whites, blacks, Hispanics, and Asians.

A payday loan or small-dollar installment loan is in fact, often the only option for these people, because traditional lenders will deny them the money. Many of these individuals have poor credit. It’s a real problem.

Avoid Loan Sharks At Any Cost

Experts have said that these people, if denied, can end up approaching loan sharks and getting funds from the black market where they are charged steep interests that are completely illegal. This can cause a spiraling debt crisis, where the only option left is to file for bankruptcy. Avoid loan sharks, stay miles away from them if you do not want to get into a debt trap.

Seek financial assistance the legal way. Protect the system and your interest. If the bank turns you back, approach a payday lender for a quick-cash loan or an installment loan. Millions of Americans are coming back to these companies whenever they need some extra cash. Just pay back in time and there won’t be a problem. Discuss an extension if you need one. Lenders are willing to listen and accommodate you.

You can apply for a installment loan or a payday loan with us. Do not worry we adhere to all state laws and will not trouble you in any illegal way. Apply your loan in our site with confidence. Just scroll top of this page and you will see a form there. Apply, rest we will take care.