REASON BEHIND THE DECREASE OF NORMAL PAYDAY LOAN STORES
March 23, 2008
There has been a rapid decrease of payday lending stores through out the United States while a rapid increase of payday lending in other countries such as Australia, United Kingdom, Sri Lanka, India, South Africa and many others which also include the South American Countries. The reason why payday loans are doing so poorly that is in normal small business owned franchise stores is because people have turned to other sources to get payday loans. With banks all over the country now offering a form of payday loans small payday loans stores have suffered tremendously. Some have also suffered due to the fact of greed with many of them having hidden fees making it hard for the customer to payback the loan and probably ending up in a debt cycle which has seen many of this customers complaining to the governor who in turn has gotten the stores closed down and some even kicked out of the city for good. States like New York have pretty much shut down all stores and states such as North Carolina have closed down the practicing of payday lending and most lenders were told to stop making new loans and collect only the principal amount of the existing loan without any interest and under these same terms where told to pay seven hundred thousand dollars to a non profit organization for relief.
CONTROVERSY IN PAYDAY LOANS
March 22, 2008
A lot of controversy has been spread about payday loans like how you can only find a payday store in poor neighborhoods as well as at military bases. Critics have also claimed that payday lenders only target the young and can be found in low-income communities only who they say do not know how to manage their money properly or may not understand the value of time and money. Some even go further and claim that payday lenders are the new form of loan sharks because of the high interest fees as well as the additional hidden fees that some payday lenders put upon the payday loan. However those that defend payday loans claim that payday loans are not different from their higher-principal, longer-term counterparts such as home mortgages. It is also argued that the high interest rates on payday loans are used unfairly on the poor who pay higher than the middleclass who apparently pay twenty five percent on their credit cards. What makes things worse for payday loans is that they claim not to check bad credit or checks however many lenders have been known to pursue people on this bad checks as well as bad credit even though they knew that the check was going to bounce at the time. All in all payday loans is currently seeing a drop in some areas but a high in others due to the fact that the middleclass are now getting into payday loans as well as banks are now offering their own form of payday loans.
WHY PAYDAY LOANS ARE A NECESSITY
March 21, 2008
Most critics of payday loans will tell you that payday is not a essential product in the market and that payday lenders are out to get the poor and people who cannot afford to pay it back. Infact most critics claim that payday lenders are just a new form of loan sharks who are legal and instead of breaking your legs or you getting a beat down they now have the law on their side. However if you look at most people borrowing payday loans you will find that most have jobs and most are even in the middleclass. Payday loans have become a necessity because banks were not offering small loans or short term loans and most people whose paychecks where taking to long to come through had no other options if all else failed. You will even find that banks are now offering a form of payday loans. Why? You might ask yourself because they have seen that it is necessary to have short term loans. This however does not mean that payday loans do not have its drawbacks especially when it comes to the debt cycle or debt trap as it is now also called. I say that it is essential to have payday loans but one must learn to use his or her money wisely as well as learn how to budget and management.
WHERE ARE PAYDAY LENDERS SITUATED?
March 20, 2008
You can find them in anywhere nowadays, but most payday lenders can be found in small stores or franchises and some can also be found in large financial service providers who also offer there own form of payday loans. You can also find payday loans in some mainstream banks nowadays because of the need of the commodity many banks have chosen to come up with their own form of payday advance schemes which seem to be working out because many people prefer to get their loans from banks and now many people are. Many of these banks offer their clients the chance to get a small advance in cash before the check has cleared, especially those whose paycheck is delivered into the bank through electronic transfer and when the check does clear or when the client deposits the next paycheck directly into his account he or she will be charged the money that was loaned out as well as an interest which is usually the same as most payday lenders. Many people have decided to become payday lenders and you can find that even grocery stores offer payday loans and off course you can now find many online stores on the internet.
THE PAYDAY LOAN PROCESS
March 19, 2008
When applying for a payday loan you must have all your necessities with you. You must carry your identity card with you; this is so the lender can know that you are an American citizen and that you are capable of taking out a payday loan by being over the age of eighteen. You will probably have to leave contact details for work as well as your own. You have to have proof that you work and have worked there in some case for more than a month in other cases for more than three months the longer the better. Most lenders usually ask for a postdated check which has covered the loan and fees as well as the interest that would have been gained from you take out that loan. Payday lenders interest usually varies but most as for ten percent to twenty percent of what you have taken out which is quite high but the loan is small and I guess that is how they make their profits.
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