The Internet has so many opportunities to offer to everyone. If you are jobless or a businessman looking for sources of income, the right place to find one is on the Web. Even when you are financially down and in need of cash immediately, internet loans are within your mouse’ reach. You don’t have to take the long line just to fill out a cash advance loan application form with your traditional neighborhood lender. There are now several lenders of payday loans operating online which you can deal with through your internet connected personal computer. It’s easy and convenient to apply online. Just go to Google search and look for internet loan lenders. You will find sites, such as badcreditloan247.com/ or www.loans200.com. And with a click of your mouse, there you are on your screen choosing the best lenders of instant loans online. However, you should exercise extreme caution before making a final decision to borrow funds from internet loans. Study carefully the interest and other loan provision. Be sure that you will not add sorrow to your present financial predicament. There is a debt trap that you should look out for in order to avoid it. Before you sign up for that payday loan offered online, try some other options to source the much needed fund.
Things to do
If you have decided to pursue internet loans, the best thing to do is plan. There’s no other way to excel in doing any kind of activity except when it is planned. Since this type of loan is quite costly in terms of interest expenses, it is then presumed that you are finally convinced to borrow money from it after you failed to raise the funds through other means. If that is the situation, then there’s no option left to you aside from internet loans that could address your money problems immediately. Here are some of the things that you should do in order to handle the internet loans properly.
- Prepare a budget-the lack of budgeting whether in your personal or business affairs is always the cause of overspending. When there’s no budget to follow, you can’t check the limits of your purchases so that you’re always incurring deficit. You can never stabilize your cash position if don’t have a cash budget. It is vital to prepare a budget to follow in order to monitor and manage your cash properly. This is very important even on your personal finance especially if you will negotiate internet payday loans. If you don’t have a budget to follow, chances are you’ll get chained forever to its debt trap cycle. You’ll have to resort to keep on borrowing payday loans just to tie you over to the next payroll.
- Find ways to augment your income-remember that an internet payday loan is deducted on the next payday check. The cash that was taken out will have to be sourced somewhere to meet your current expenses. You should find ways to produce that cash or else your basic necessities would be affected. You could perhaps do other jobs or engage in trade to augment your present income so that you can pay the internet loan without feeling the pressure of finding the funds paid for it.
- Search other alternative creditors-don’t wait before your internet loan matures. Find other sources of funds through other creditors in your community who are willing to lend you some cash at low interest than what payday lenders are charging you. You might have an outstanding credit line with another creditor that you can negotiate for re-availment. Check your credit cards that allow cash advance with longer terms and lower interest. If they are more beneficial to use, borrow funds from them and pay your internet payday loans.
- Dispose other properties-another way to meet your internet loans before it matures is by selling other properties that you don’t have use of. An old car or appliances in your garage could raise the cash that you need to retire your costly payday loan. In selling these assets, make it sure that you don’t sell at bargain prices. You might be incurring more losses than renewing your payday loans at their present high interest rate. Do your homework before taking such move.
- Find the best internet loan lender-shop around before negotiating with the lender of internet loan. Compare their interest rates, the terms of the loan and amount that you can borrow. Negotiate only with direct lenders of internet loans so that you can have the best rates. Do not entrust your data to indirect online lenders and check your lenders accreditation with the BBB in your community. Watch out in dealing with internet payday lenders. There are scammers on the Web and beware of getting victimized.
- Negotiate the best terms-don’t settle on the first offer that is offered to you. Study every term that go with the payday loan proposal. Try to find the best terms before negotiating your internet loans. You can only do this by studying closely how internet loan operates.
Why Avoid It
If you have done your homework in studying the pros and cons of internet loan, you’ll be guided how to avoid it. Below are some of the reasons why you should distance yourself from this loan.
- High interest rates-are you willing to pay seven hundred times the amount you borrowed in one year? Perhaps you’ll be surprised if this is the first time you’ll hear about payday loans. Yes, that’s correct. The interest rate of payday loan could go as high as 780% in APR. It’s really incomparable to the average 8% interest rate for car loans. This is one factor that you should remember before you borrow money from internet loans. They could wipe out your cash position with the expensive interest rates that they are charging.
- Small loan amount-consider the loan amount involved when you apply for internet payday loan. Look for the lender that could meet your cash needs before you make up your mind about the lender. Bear in mind that the loan amount is comparatively small when compared to regular loans. Of course, the reason behind this is that it is clean and your collateral is the amount of your paycheck.
- Short payment date-the payment date normally timed with your payroll period. The internet payday loan usually falls due after 14 days. With this short period of time, many borrowers will find it difficult to raise the cash needed to cover the amount deducted from their paycheck in payment of the loan. So, the borrower has no option but to resort to renewal of the loan to get back the cash he paid for the previous loan. The cycle repeats itself so that the borrower it tied to it.
- Risky security with postdated check-verify first with your preferred internet payday loan lender if a postdated check is required. In some States, this is a requirement before you can avail of a payday loan. When the check matures, the borrower is required to redeem it. In some cases, the creditor deposits the check at its date. When the check bounced, some lenders use it as a leverage to collect the account. Others use the unpaid or unredeemed check in filing a case in court to harass the borrower. It is risky to issue a postdated check to secure a payday loan.
- There’s a debt trap-the debt trap cycle is the term referring to the situation when the borrower keeps on renewing the loan or resort to roll-overs. He will secure a new payday loan to pay the other old loan. Or the loan is automatically renewed by the creditor if it is not paid on time. Attached to it is the high interest rate which normally goes of the same rate of the initial loan. This cycle stops only when the borrower pays the account in full.
- It does not really help-some who are not in favor of payday loans contend that this credit tool does not actually helps the consumers. But, on the contrary, the lenders of internet payday loans are making a killing to make money. It is the other way around. The fact remains that lenders are thriving at the expense of the consumers’ financial woes.
While internet loans are reliable when it comes to emergency situations as they are processed faster than any other loan, it should be noted that caution must be exercised in using them. Every borrower must understand that their costs of services are very high. You can’t just ignore this fact since you are bound to pay them whatever situation you might be once you signed up. It would be difficult to pay the internet payday loan if you are not prepared. The above guides are important to both forewarn you and keep you alerted about the things that you should remember when dealing with internet loans. Always bear in mind that planning is very important in dealing with this lending tool. And that includes a good budget preparation.