The Penalties for Not Paying Back a Payday Loan

Tuesday, December 18, 2012

Times are rough and you are not always smooth sailing all the way. We all know that and probably we all have experienced that. If you are one of the people who have experienced hard times then you would definitely agree that it is not easy most especially if it requires you to acquire a specific amount of money. It is very difficult to get by in these situations.

If this happened back in the days, we cannot imagine how people went through this mess. However, thank God that we live in modern times where problems like these usually have solutions that went along with it. Imagine yourself on an emergency and it requires you to accumulate a specific amount of money. You then checked your credits and realized that you are very short on finances and your next payday is not due until next week. What would you do?

Being in a situation like these sucks so bad because one, you cannot always trust your neighbors, family or friends to spare some cash for you to borrow. If these were difficult times, then they would probably need the money too. It is not always a feasible option. The best option you have in times like these are payday loans.

However, you should be aware of the consequences of not paying the loan that you took. Let us explain further.

Payday loans are what we could call "unsecured loan" given to people with matching high interest rates in exchange for less hassle, less requirements and lack of collateral. Not paying the loan on the date, which you are required to pay it, will give you a lot of problems. These problems are:

Higher interest. More debts. Humiliation Ignominy in the society. Harassment from the agency. Emotional damage due to threatening calls and collections. Damage to your credit record. Legal problems.

Payday loans or cash advance loans (they are the same) are loans that you can get if you need money for emergency purposes these types of loans are the best option that you have. These loans are also easy to acquire. Today we will explain it briefly so that you would understand it well. The requirements are quite simple. All you need is a working checking account and employment. When you have these things, you are good to go. You can find this type of loan on various lending investors or lending places. Companies also offer it to their employees.

However, you should always remember that when you applied for this loan, and you were approved. You should also remember to pay it. There are consequences in not paying it on time. Although you might not consider it as something severe, it will cause you more problems in the future.

There are penalties in not paying the loan. They might charge an extra fee for it, which also increases the longer the time that you do not pay it. It varies from lender to lender. Before you go and apply for this loan, you should understand these following things first:

- You can use payday loans to prevent bouncing checks. Bouncing checks are expensive to deal with; it is a lot more expensive than taking a payday loan. You should use it to pay something that you need to pay for immediately. Do not use it to pay monthly dues because it would only worsen your situation.

- Not paying your payday loans on the due date is allowable but for a penalty. If you were not able to pay the loan, some lenders allow people to roll over the loan and extend the time that you would pay for it. However, that comes with a price or interest. So you had better make sure, if you can keep your responsibilities of paying it on time. This could be more of a headache than a solution to your problem if you do not pay on time.

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